Moody’s Investor Service has put the financial strength ratings of Genworth Australia on review for a possible downgrade after the lenders’ mortgage insurer warned of a first-quarter loss and postponed its partial float.

Genworth’s US parent announced last week that the plan for a $US80 million ($77 million) initial public offering (IPO) of 40% of the local company will not proceed in the second quarter. But it aims to revive the offer in early 2013.

Genworth Australia expects a “modest” loss and says the number of claims and their severity rose in the quarter, particularly in Queensland coastal areas that have been affected by natural catastrophes and regional economic slowdowns.

Moody’s says it has placed the insurance financial strength ratings of Genworth Australia, rated A1, and Genworth Financial Mortgage Indemnity, rated A2, “on review” for possible downgrading.

Senior Credit Officer Ilya Serov says the ratings agency is concerned about the higher-than-anticipated losses.

“The company’s performance during this period was adversely affected by developments in the coastal Queensland housing markets, underlining the vulnerabilities of its business model to a downturn in a regional area or in the broader Australian housing market,” he said.

Mr Serov says the rating review will focus on whether the increase in claims is likely to be prolonged and if this could reduce the company’s capitalisation over time.

Moody’s will also evaluate the adequacy of Genworth’s risk management.

It will consider the impact of postponing the float on Genworth’s financial flexibility and whether there will be “continued heightened reliance on its US parent” for capital market access.

Genworth US says the local company’s liquidity and risk buffer plans are not dependent on the IPO, with the holding company having $US1.4 billion ($1.35 billion) in cash and highly liquid securities at March 31.