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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Radian Group Inc | NYSE:RDN | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.46 | 1.48% | 31.64 | 31.685 | 31.23 | 31.23 | 569,773 | 00:31:39 |
— Fourth quarter net income of $143 million, or $0.91 per diluted share, and full year net income of $603 million, or $3.77 per diluted share —
— Full year return on equity of 14.5% —
— Book value per share growth of 15% year-over-year to $28.71 —
— Full year total revenue growth of 4% year-over-year to $1.2 billion —
— Primary mortgage insurance in force increased year-over-year to all-time high $270 billion —
— Returned $279 million of capital to shareholders during the year via dividends and share repurchases —
Radian Group Inc. (NYSE: RDN) today reported net income for the quarter ended December 31, 2023, of $143 million, or $0.91 per diluted share. This compares with net income for the quarter ended December 31, 2022, of $162 million, or $1.01 per diluted share.
Net income for the full year 2023 was $603 million, or $3.77 per diluted share. This compares with net income for the full year 2022 of $743 million, or $4.35 per diluted share.
Key Financial Highlights
Quarter ended
Year ended
($ in millions, except per-share amounts)
December 31, 2023
September 30, 2023
December 31, 2022
December 31, 2023
December 31, 2022
Total revenues
$329
$313
$315
$1,241
$1,191
Net income
$143
$157
$162
$603
$743
Diluted net income per share
$0.91
$0.98
$1.01
$3.77
$4.35
Consolidated pretax income
$180
$201
$203
$767
$953
Adjusted pretax operating income (1)
$192
$210
$213
$786
$1,053
Adjusted diluted net operating income per share (1)(2)
$0.96
$1.04
$1.05
$3.88
$4.87
Return on equity (3)
13.4%
15.0%
17.0%
14.5%
18.2%
Adjusted net operating return on equity (1)(2)
14.2%
16.0%
17.6%
14.9%
20.3%
New Insurance Written (NIW) - mortgage insurance
$10,629
$13,922
$12,859
$52,670
$67,954
Net premiums earned - mortgage insurance
$230
$237
$230
$909
$957
New defaults
12,452
11,156
10,735
44,007
37,738
Provision for losses - mortgage insurance
$5
($8)
($44)
($42)
($339)
As of
($ in millions, except per-share amounts)
December 31, 2023
September 30, 2023
December 31, 2022
Book value per share
$28.71
$26.69
$24.95
Accumulated other comprehensive income (loss) value per share (4)
($2.16)
($3.35)
($2.91)
PMIERs Available Assets (5)
$5,890
$5,758
$5,553
PMIERs excess Available Assets (6)
$2,260
$1,670
$1,727
Total Holding Company Liquidity (7)
$1,267
$1,279
$1,178
Total investments
$6,086
$5,886
$5,693
Primary mortgage insurance in force
$269,979
$269,511
$260,994
Percentage of primary loans in default (8)
2.2%
2.0%
2.2%
Mortgage insurance loss reserves
$365
$362
$421
(1)
Adjusted results, including adjusted pretax operating income, adjusted diluted net operating income per share and adjusted net operating return on equity, are non-GAAP financial measures. For definitions and reconciliations of these measures to the comparable GAAP measures, see Exhibits F and G.
(2)
Calculated using the company’s statutory tax rate of 21%.
(3)
Calculated by dividing annualized net income by average stockholders’ equity, based on the average of the beginning and ending balances for each period presented.
(4)
Included in book value per share for each period presented.
(5)
Represents Radian Guaranty’s Available Assets, calculated in accordance with the Private Mortgage Insurer Eligibility Requirements (PMIERs) financial requirements in effect for each date shown.
(6)
Represents Radian Guaranty’s excess or “cushion” of Available Assets over its Minimum Required Assets, calculated in accordance with the PMIERs financial requirements in effect for each date shown.
(7)
Represents Radian Group’s total liquidity, including available capacity under its $275 million unsecured revolving credit facility.
(8)
Represents the number of primary loans in default as a percentage of the total number of insured primary loans.
Adjusted pretax operating income for the quarter ended December 31, 2023, was $192 million, or $0.96 per diluted share. This compares with adjusted pretax operating income for the quarter ended December 31, 2022, of $213 million, or $1.05 per diluted share.
Adjusted pretax operating income for the full year 2023 was $786 million, or $3.88 per diluted share. This compares with adjusted pretax operating income for the full year 2022, of $1.1 billion, or $4.87 per diluted share.
Book value per share at December 31, 2023, was $28.71, compared to $26.69 at September 30, 2023, and $24.95 at December 31, 2022. This represents a 15% growth in book value per share at December 31, 2023, as compared to December 31, 2022, and includes accumulated other comprehensive income (loss) of $(2.16) per share as of December 31, 2023, and $(2.91) per share as of December 31, 2022. Changes in accumulated other comprehensive income (loss) are primarily from net unrealized gains or losses on investments as a result of decreases or increases, respectively, in market interest rates.
“We reported another successful year for Radian in 2023, increasing book value per share by 15% year-over-year, generating net income of $603 million and delivering a return on equity of approximately 15%. Despite a challenging macroeconomic environment, total revenues grew to $1.2 billion and our primary mortgage insurance in force, which is the main driver of future earnings for our company, reached an all-time high of $270 billion,” said Radian’s Chief Executive Officer Rick Thornberry. “We continue to strategically manage capital, and in 2023 paid $400 million of ordinary dividends from Radian Guaranty to Radian Group and returned $279 million of capital to stockholders through dividends and share repurchases. We accomplished all of this working together as a “One Radian” team and look forward to the opportunities ahead in 2024.”
FOURTH QUARTER AND FULL YEAR HIGHLIGHTS
CAPITAL AND LIQUIDITY UPDATE
Radian Group
Radian Guaranty
RECENT EVENTS
CONFERENCE CALL
Radian will discuss fourth quarter 2023 financial results in a conference call tomorrow, Thursday, February 8, 2024, at 12:00 p.m. Eastern time. The conference call will be webcast live on the company’s website at https://radian.com/who-we-are/for-investors/webcasts or at www.radian.com. The webcast is listen-only. Those interested in participating in the question-and-answer session should follow the conference call dial-in instructions below.
The call may be accessed via telephone by registering for the call here to receive the dial-in numbers and unique PIN. It is recommended that you join 10 minutes prior to the event start (although you may register and dial in at any time during the call).
A digital replay of the webcast will be available on Radian’s website approximately two hours after the live broadcast ends for a period of one year at https://radian.com/who-we-are/for-investors/webcasts.
In addition to the information provided in the company’s earnings news release, other statistical and financial information, which is expected to be referred to during the conference call, will be available on Radian’s website at www.radian.com, under Investors.
NON-GAAP FINANCIAL MEASURES
Radian believes that adjusted pretax operating income (loss), adjusted diluted net operating income (loss) per share and adjusted net operating return on equity (non-GAAP measures) facilitate evaluation of the company’s fundamental financial performance and provide relevant and meaningful information to investors about the ongoing operating results of the company. On a consolidated basis, these measures are not recognized in accordance with accounting principles generally accepted in the United States of America (GAAP) and should not be considered in isolation or viewed as substitutes for GAAP measures of performance. The measures described below have been established in order to increase transparency for the purpose of evaluating the company’s operating trends and enabling more meaningful comparisons with Radian’s competitors.
Adjusted pretax operating income (loss) is defined as GAAP consolidated pretax income (loss) excluding the effects of: (i) net gains (losses) on investments and other financial instruments, except for certain investments and other financial instruments attributable to our reportable segments and All Other activities; (ii) amortization and impairment of goodwill and other acquired intangible assets; and (iii) impairment of other long-lived assets and other non-operating items, if any, such as gains (losses) from the sale of lines of business, acquisition-related income and expenses and gains (losses) on extinguishment of debt. Adjusted diluted net operating income (loss) per share is calculated by dividing adjusted pretax operating income (loss) attributable to common stockholders, net of taxes computed using the company’s statutory tax rate, by the sum of the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. Adjusted net operating return on equity is calculated by dividing annualized adjusted pretax operating income (loss), net of taxes computed using the company’s statutory tax rate, by average stockholders’ equity, based on the average of the beginning and ending balances for each period presented.
See Exhibit F or Radian’s website for a description of these items, as well as Exhibit G for reconciliations to the most comparable consolidated GAAP measures.
ABOUT RADIAN
Radian Group Inc. (NYSE: RDN) is ensuring the American dream of homeownership responsibly and sustainably through products and services that include industry-leading mortgage insurance and a comprehensive suite of mortgage, risk, title, valuation, asset management and other real estate services. We are powered by technology, informed by data and driven to deliver new and better ways to transact and manage risk. Visit www.radian.com and homegenius.com to learn more about how Radian and its pioneering homegenius platform are building a smarter future for mortgage and real estate services.
FINANCIAL RESULTS AND SUPPLEMENTAL INFORMATION CONTENTS (Unaudited)
Exhibit A:
Condensed Consolidated Statements of Operations
Exhibit B:
Net Income Per Share
Exhibit C:
Condensed Consolidated Balance Sheets
Exhibit D:
Net Premiums Earned and Other Operating Expenses
Exhibit E:
Segment Information
Exhibit F:
Definition of Consolidated Non-GAAP Financial Measures
Exhibit G:
Consolidated Non-GAAP Financial Measure Reconciliations
Exhibit H:
Mortgage Insurance Supplemental Information - New Insurance Written
Exhibit I:
Mortgage Insurance Supplemental Information - Primary Insurance in Force and Risk in Force
Radian Group Inc. and Subsidiaries Condensed Consolidated Statements of Operations Exhibit A (page 1 of 2)
2023
2022
(In thousands, except per-share amounts)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Revenues
Net premiums earned
$
232,649
$
240,262
$
213,429
$
233,238
$
232,827
Services revenue
12,419
10,892
11,797
10,984
15,441
Net investment income (1)
68,824
67,805
63,348
58,453
59,091
Net gains (losses) on investments and other financial instruments
13,447
(8,555
)
(236
)
5,585
6,845
Other income
1,305
2,109
1,241
1,592
520
Total revenues
328,644
312,513
289,579
309,852
314,724
Expenses
Provision for losses
4,170
(8,135
)
(21,632
)
(16,929
)
(43,599
)
Policy acquisition costs
6,147
6,920
5,218
6,293
5,931
Cost of services
8,950
8,886
10,257
10,398
16,128
Other operating expenses
95,218
79,206
89,885
83,269
109,785
Interest expense (1)
23,169
23,282
21,805
21,439
21,594
Impairment of goodwill
9,802
—
—
—
—
Amortization of other acquired intangible assets
1,371
1,371
1,370
1,371
1,587
Total expenses
148,827
111,530
106,903
105,841
111,426
Pretax income
179,817
200,983
182,676
204,011
203,298
Income tax provision
37,124
44,401
36,589
46,254
40,968
Net income
$
142,693
$
156,582
$
146,087
$
157,757
$
162,330
Diluted net income per share
$
0.91
$
0.98
$
0.91
$
0.98
$
1.01
(1)
Effective in the fourth quarter of 2023, expenses associated with securities lending transactions that had previously been reported as a component of interest expense are now included in net investment income, along with the applicable income. Net investment income and interest expense, including allocated interest expense, for prior periods in 2023 have been restated to reflect this reclassification, which totaled $2.6 million for the first three quarters of 2023.
Radian Group Inc. and Subsidiaries Condensed Consolidated Statements of Operations Exhibit A (page 2 of 2)
Years Ended December 31,
(In thousands, except per-share amounts)
2023
2022
Revenues:
Net premiums earned
$
919,578
$
981,131
Services revenue
46,092
92,216
Net investment income
258,430
195,658
Net gains (losses) on investments and other financial instruments
10,241
(80,733
)
Other income
6,247
2,454
Total revenues
1,240,588
1,190,726
Expenses:
Provision for losses
(42,526
)
(338,239
)
Policy acquisition costs
24,578
23,918
Cost of services
38,491
82,358
Other operating expenses
347,578
381,148
Interest expense
89,695
84,454
Impairment of goodwill
9,802
—
Amortization of other acquired intangible assets
5,483
4,308
Total expenses
473,101
237,947
Pretax income
767,487
952,779
Income tax provision
164,368
209,845
Net income
$
603,119
$
742,934
Diluted net income per share
$
3.77
$
4.35
Radian Group Inc. and Subsidiaries Net Income Per Share Exhibit B
The calculation of basic and diluted net income per share is as follows.
2023
2022
(In thousands, except per-share amounts)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Net income—basic and diluted
$
142,693
$
156,582
$
146,087
$
157,757
$
162,330
Average common shares outstanding—basic
155,318
158,461
159,010
158,304
158,357
Dilutive effect of share-based compensation arrangements (1)
1,909
1,686
1,734
3,045
2,450
Adjusted average common shares outstanding—diluted
157,227
160,147
160,744
161,349
160,807
Basic net income per share
$
0.92
$
0.99
$
0.92
$
1.00
$
1.03
Diluted net income per share
$
0.91
$
0.98
$
0.91
$
0.98
$
1.01
(1)The following number of shares of our common stock equivalents issued under our share-based compensation arrangements are not included in the calculation of diluted net income per share because their effect would be anti-dilutive.
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Shares of common stock equivalents
—
—
112
25
—
Years Ended December 31,
(In thousands, except per-share amounts)
2023
2022
Net income - basic and diluted
$
603,119
$
742,934
Average common shares outstanding—basic
158,140
167,930
Dilutive effect of stock-based compensation arrangements (1)
1,993
2,734
Adjusted average common shares outstanding—diluted
160,133
170,664
Basic net income per share
$
3.81
$
4.42
Diluted net income per share
$
3.77
$
4.35
(1)
The following number of shares of our common stock equivalents issued under our share-based compensation arrangements were not included in the calculation of diluted net income per share because they would be anti-dilutive:
Years Ended December 31,
(In thousands)
2023
2022
Shares of common stock equivalents
14
—
Radian Group Inc. and Subsidiaries Condensed Consolidated Balance Sheets Exhibit C
December 31,
September 30,
June 30,
March 31,
December 31,
(In thousands, except per-share amounts)
2023
2023
2023
2023
2022
Assets
Investments
$
6,085,654
$
5,885,652
$
5,895,871
$
5,837,892
$
5,693,491
Cash
18,999
55,489
61,142
50,167
56,183
Restricted cash
1,066
1,305
1,317
577
377
Accrued investment income
45,783
45,623
42,650
42,567
40,093
Accounts and notes receivable
123,857
144,614
138,432
129,565
119,834
Reinsurance recoverable
25,909
24,148
22,979
24,396
25,633
Deferred policy acquisition costs
18,718
18,817
19,272
18,236
18,460
Property and equipment, net
63,822
74,558
73,885
72,111
70,981
Goodwill and other acquired intangible assets, net
—
11,173
12,543
13,914
15,285
Prepaid federal income taxes
750,320
696,820
663,320
596,368
596,368
Other assets
459,805
420,483
375,132
418,609
427,024
Total assets
$
7,593,933
$
7,378,682
$
7,306,543
$
7,204,402
$
7,063,729
Liabilities and stockholders’ equity
Unearned premiums
$
225,396
$
236,400
$
246,666
$
257,735
$
271,479
Reserve for losses and loss adjustment expense
370,148
367,568
379,434
405,651
426,843
Senior notes
1,417,781
1,416,687
1,415,610
1,414,549
1,413,504
Secured borrowings
119,476
241,753
178,762
121,642
155,822
Reinsurance funds withheld
130,564
156,114
154,354
153,099
152,067
Net deferred tax liability
589,564
497,560
479,754
455,517
391,083
Other liabilities
343,199
309,701
281,127
289,731
333,604
Total liabilities
3,196,128
3,225,783
3,135,707
3,097,924
3,144,402
Common stock
173
175
177
176
176
Treasury stock
(945,870
)
(945,504
)
(945,032
)
(931,313
)
(930,643
)
Additional paid-in capital
1,430,594
1,482,712
1,522,895
1,515,852
1,519,641
Retained earnings
4,243,759
4,136,598
4,016,482
3,908,396
3,786,952
Accumulated other comprehensive income (loss)
(330,851
)
(521,082
)
(423,686
)
(386,633
)
(456,799
)
Total stockholders’ equity
4,397,805
4,152,899
4,170,836
4,106,478
3,919,327
Total liabilities and stockholders’ equity
$
7,593,933
$
7,378,682
$
7,306,543
$
7,204,402
$
7,063,729
Shares outstanding
153,179
155,582
157,350
156,547
157,056
Book value per share
$
28.71
$
26.69
$
26.51
$
26.23
$
24.95
Holding company debt-to-capital ratio (1)
24.4
%
25.4
%
25.3
%
25.6
%
26.5
%
(1)
Calculated as carrying value of senior notes, which were issued and are owed by our holding company, divided by carrying value of senior notes and stockholders’ equity. This holding company ratio does not include the effects of amounts owed by our subsidiaries related to secured borrowings.
Radian Group Inc. and Subsidiaries Net Premiums Earned and Other Operating Expenses Exhibit D (page 1 of 2)
Net Premiums Earned
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Premiums earned
Direct - Mortgage Insurance
Premiums earned, excluding revenue from cancellations
$
256,632
$
254,903
$
252,537
$
251,166
$
247,880
Single Premium Policy cancellations
2,058
3,304
3,980
5,361
5,756
Total direct - Mortgage Insurance
258,690
258,207
256,517
256,527
253,636
Assumed - Mortgage Insurance
—
—
—
—
(56
)
Ceded - Mortgage Insurance
Premiums earned, excluding revenue from cancellations (1)
(40,065
)
(32,363
)
(57,916
)
(35,526
)
(35,773
)
Single Premium Policy cancellations (2)
(444
)
(873
)
(1,114
)
(1,472
)
(1,676
)
Profit commission - other (3)
12,199
11,830
13,245
11,921
13,802
Total ceded premiums - Mortgage Insurance
(28,310
)
(21,406
)
(45,785
)
(25,077
)
(23,647
)
Net premiums earned - Mortgage Insurance
230,380
236,801
210,732
231,450
229,933
Net premiums earned - homegenius
2,269
3,461
2,697
1,788
2,894
Net premiums earned
$
232,649
$
240,262
$
213,429
$
233,238
$
232,827
(1)
The second quarter of 2023 includes the result of the tender offers by Eagle Re 2019-1 Ltd. and Eagle Re 2020-1 Ltd. to purchase the mortgage insurance-linked notes that supported their reinsurance agreements with Radian Guaranty. As a result, Radian Guaranty incurred additional ceded premiums earned during the second quarter of 2023 of $21 million, consisting of $16 million related to the cost of tender premiums and associated expenses and $5 million related to the acceleration of deferred costs from the original executions of these transactions.
(2)
Includes the impact of related profit commissions.
(3)
The amounts represent the profit commission under our QSR Program, excluding the impact of Single Premium Policy cancellations.
Other Operating Expenses
Total
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Other operating expenses by type
Salaries and other base employee expenses
$
34,182
$
33,272
$
39,032
$
35,064
$
47,995
Variable and share-based incentive
20,262
19,546
18,908
18,273
15,321
Other general operating expenses
45,186
(1)
29,812
35,655
33,863
50,488
Ceding commissions
(5,327
)
(5,153
)
(4,824
)
(4,628
)
(5,098
)
Title agent commissions
915
1,729
1,114
697
1,079
Total
$
95,218
$
79,206
$
89,885
$
83,269
$
109,785
(2)
(1)
Includes $14 million of impairment of long-lived assets, primarily from impairments to our lease-related assets and internal-use software.
(2)
Includes $12 million of severance and related expenses, primarily in salaries and other base employee expenses, and $15 million of impairment of long-lived assets, primarily in other general operating expenses.
Radian Group Inc. and Subsidiaries Net Premiums Earned Exhibit D (page 2 of 2)
Net Premiums Earned
Years Ended December 31,
(In thousands)
2023
2022
Premiums earned
Direct - Mortgage Insurance
Premiums earned, excluding revenue from cancellations
$
1,015,238
$
991,556
Single Premium Policy cancellations
14,703
34,051
Total direct - Mortgage Insurance
1,029,941
1,025,607
Assumed - Mortgage Insurance (1)
—
4,025
Ceded - Mortgage Insurance
Premiums earned, excluding revenue from cancellations
(165,870
)
(130,556
)
Single Premium Policy cancellations (2)
(3,903
)
(9,677
)
Profit commission - other (3)
49,195
67,814
Total ceded premiums - Mortgage Insurance
(120,578
)
(72,419
)
Net premiums earned - Mortgage Insurance
909,363
957,213
Net premiums earned - homegenius
10,215
23,918
Net premiums earned
$
919,578
$
981,131
(1)
Represents premiums from our participation in certain credit risk transfer programs. We discontinued our participation in these programs in December 2022 by novating these insurance policies to an unrelated third-party reinsurer.
(2)
Includes the impact of related profit commissions.
(3)
The amounts represent the profit commission under our QSR Program, excluding the impact of Single Premium Policy cancellations.
Other Operating Expenses
Years Ended December 31,
(In thousands)
2023
2022
Other operating expenses by type
Salaries and other base employee expenses
$
141,550
$
159,690
Variable and share-based incentive compensation
76,989
70,868
Other general operating expenses
144,516
(1)
160,927
Ceding commissions
(19,932
)
(16,164
)
Title agent commissions
4,455
5,827
Total
$
347,578
$
381,148
(2)
(1)
Includes $14 million of impairment of long-lived assets, primarily from impairments to our lease-related assets and internal-use software.
(2)
Includes $12 million of severance and related expenses, primarily in salaries and other base employee expenses, and $15 million of impairment of long-lived assets, primarily in other general operating expenses.
Radian Group Inc. and Subsidiaries Segment Information Exhibit E (page 1 of 5)
Summarized financial information concerning our operating segments as of and for the periods indicated is as follows. For a definition of adjusted pretax operating income (loss), along with a reconciliation to its consolidated GAAP measure, see Exhibits F and G.
Three Months Ended December 31, 2023
(In thousands)
Mortgage Insurance
homegenius
All Other (1)
Inter-segment (2)
Total
Net premiums written (3)
$
225,112
$
2,269
$
—
$
—
$
227,381
(Increase) decrease in unearned premiums
5,268
—
—
—
5,268
Net premiums earned
230,380
2,269
—
—
232,649
Services revenue
202
12,311
—
(94
)
12,419
Net investment income
51,061
586
17,177
—
68,824
Net gains (losses) on investments and other financial instruments
—
—
356
—
356
Other income
1,302
—
14
(11
)
1,305
Total
282,945
15,166
17,547
(105
)
315,553
Provision for losses
4,608
(438
)
—
—
4,170
Policy acquisition costs
6,147
—
—
—
6,147
Cost of services
157
8,793
—
—
8,950
Other operating expenses before allocated corporate operating expenses (4)
15,559
19,757
3,903
(105
)
39,114
Interest expense
21,748
—
1,421
—
23,169
Total
48,219
28,112
5,324
(105
)
81,550
Adjusted pretax operating income (loss) before allocated corporate operating expenses
234,726
(12,946
)
12,223
—
234,003
Allocation of corporate operating expenses
36,929
4,930
410
—
42,269
Adjusted pretax operating income (loss)
$
197,797
$
(17,876
)
$
11,813
$
—
$
191,734
Radian Group Inc. and Subsidiaries Segment Information Exhibit E (page 2 of 5)
Three Months Ended December 31, 2022
(In thousands)
Mortgage Insurance
homegenius
All Other (1)
Inter-segment (2)
Total
Net premiums written (3)
$
227,791
$
2,894
$
—
$
—
$
230,685
(Increase) decrease in unearned premiums
2,142
—
—
—
2,142
Net premiums earned
229,933
2,894
—
—
232,827
Services revenue
328
15,207
—
(94
)
15,441
Net investment income
52,165
366
6,560
—
59,091
Net gains (losses) on investments and other financial instruments
—
—
47
—
47
Other income
512
170
8
(170
)
520
Total
282,938
18,637
6,615
(264
)
307,926
Provision for losses
(43,509
)
(90
)
—
—
(43,599
)
Policy acquisition costs
5,931
—
—
—
5,931
Cost of services
235
15,893
—
—
16,128
Other operating expenses before allocated corporate operating expenses (4)
20,131
27,998
3,606
(264
)
51,471
Interest expense
21,580
—
14
—
21,594
Total
4,368
43,801
3,620
(264
)
51,525
Adjusted pretax operating income (loss) before allocated corporate operating expenses
278,570
(25,164
)
2,995
—
256,401
Allocation of corporate operating expenses
36,663
6,302
420
—
43,385
Adjusted pretax operating income (loss)
$
241,907
$
(31,466
)
$
2,575
$
—
$
213,016
Year Ended December 31, 2023
(In thousands)
Mortgage Insurance
homegenius
All Other (1)
Inter-segment (2)
Total
Net premiums written (3)
$
904,240
$
10,215
$
—
$
—
$
914,455
Decrease in unearned premiums
5,123
—
—
—
5,123
Net premiums earned
909,363
10,215
—
—
919,578
Services revenue
1,088
45,394
—
(390
)
46,092
Net investment income
195,077
2,031
61,322
—
258,430
Net gains (losses) on investments and other financial instruments
—
—
814
—
814
Other income
5,372
—
27
(20
)
5,379
Total
1,110,900
57,640
62,163
(410
)
1,230,293
Provision for losses
(42,136
)
(390
)
—
—
(42,526
)
Policy acquisition costs
24,578
—
—
—
24,578
Cost of services
713
37,778
—
—
38,491
Other operating expenses before allocated corporate operating expenses (4)
71,150
87,739
11,291
(5)
(410
)
169,770
Interest expense
86,188
—
3,507
—
89,695
Total
140,493
125,127
14,798
(410
)
280,008
Adjusted pretax operating income (loss) before allocated corporate operating expenses
970,407
(67,487
)
47,365
(5)
—
950,285
Allocation of corporate operating expenses
140,583
18,783
4,492
—
163,858
Adjusted pretax operating income (loss)
$
829,824
$
(86,270
)
$
42,873
$
—
$
786,427
Radian Group Inc. and Subsidiaries Segment Information Exhibit E (page 3 of 5)
Year Ended December 31, 2022
(In thousands)
Mortgage Insurance
homegenius
All Other (1)
Inter-segment (2)
Total
Net premiums written (3)
$
959,872
$
23,918
$
—
$
—
$
983,790
Decrease in unearned premiums
(2,659
)
—
—
—
(2,659
)
Net premiums earned
957,213
23,918
—
—
981,131
Services revenue
7,390
85,158
—
(332
)
92,216
Net investment income
171,221
729
23,708
—
195,658
Net gains (losses) on investments and other financial instruments
—
—
47
—
47
Other income
2,376
170
78
(170
)
2,454
Total
1,138,200
109,975
23,833
(502
)
1,271,506
Provision for losses
(339,374
)
1,135
—
—
(338,239
)
Policy acquisition costs
23,918
—
—
—
23,918
Cost of services
5,951
76,407
—
—
82,358
Other operating expenses before allocated corporate operating expenses (4)
92,756
97,775
13,269
(502
)
203,298
Interest expense
84,440
—
14
—
84,454
Total
(132,309
)
175,317
13,283
(502
)
55,789
Adjusted pretax operating income (loss) before allocated corporate operating expenses
1,270,509
(65,342
)
10,550
—
1,215,717
Allocation of corporate operating expenses
138,566
22,856
1,578
—
163,000
Adjusted pretax operating income (loss)
$
1,131,943
$
(88,198
)
$
8,972
$
—
$
1,052,717
(1)
All Other activities include: (i) income (losses) from assets held by our holding company; (ii) related general corporate operating expenses not attributable or allocated to our reportable segments; and (iii) certain investments in new business opportunities, including activities and investments associated with Radian Mortgage Capital, and other immaterial activities.
(2)
Includes immaterial inter-segment revenue for our homegenius segment and immaterial inter-segment expenses for our Mortgage Insurance segment and All Other activities.
(3)
Net of ceded premiums written under our quota share and excess-of-loss reinsurance agreements.
(4)
Does not include impairment of long-lived assets and other non-operating items, which are not considered components of adjusted pretax operating income (loss).
(5)
In the first quarter of 2023, as a one-time adjustment, we reclassified $2.9 million in cumulative expenses previously reflected in the All Other results as direct other operating expenses to allocated corporate operating expenses.
Radian Group Inc. and Subsidiaries Segment Information Exhibit E (page 4 of 5)
Mortgage Insurance
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Net premiums written (1)
$
225,112
$
235,169
$
214,540
$
229,419
$
227,791
(Increase) decrease in unearned premiums
5,268
1,632
(3,808
)
2,031
2,142
Net premiums earned
230,380
236,801
210,732
231,450
229,933
Services revenue
202
266
284
336
328
Net investment income (2)
51,061
49,953
48,070
45,993
52,165
Other income
1,302
1,237
1,246
1,587
512
Total
282,945
288,257
260,332
279,366
282,938
Provision for losses
4,608
(8,257
)
(21,623
)
(16,864
)
(43,509
)
Policy acquisition costs
6,147
6,920
5,218
6,293
5,931
Cost of services
157
172
143
241
235
Other operating expenses before allocated corporate operating expenses (3) (4)
15,559
16,776
20,009
18,806
20,131
Interest expense (2)
21,748
21,673
21,405
21,362
21,580
Total
48,219
37,284
25,152
29,838
4,368
Adjusted pretax operating income before allocated corporate operating expenses
234,726
250,973
235,180
249,528
278,570
Allocation of corporate operating expenses
36,929
31,744
37,081
34,829
36,663
Adjusted pretax operating income
$
197,797
$
219,229
$
198,099
$
214,699
$
241,907
homegenius
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Net premiums earned
$
2,269
$
3,461
$
2,697
$
1,788
$
2,894
Services revenue (3)
12,311
10,723
11,617
10,743
15,207
Net investment income
586
523
492
430
366
Other income (3)
—
—
—
—
170
Total
15,166
14,707
14,806
12,961
18,637
Provision for losses
(438
)
122
(9
)
(65
)
(90
)
Cost of services
8,793
8,714
10,114
10,157
15,893
Other operating expenses before allocated corporate operating expenses (4)
19,757
22,562
24,168
21,252
27,998
Total
28,112
31,398
34,273
31,344
43,801
Adjusted pretax operating income (loss) before allocated corporate operating expenses
(12,946
)
(16,691
)
(19,467
)
(18,383
)
(25,164
)
Allocation of corporate operating expenses
4,930
4,241
4,954
4,658
6,302
Adjusted pretax operating income (loss)
$
(17,876
)
$
(20,932
)
$
(24,421
)
$
(23,041
)
$
(31,466
)
Radian Group Inc. and Subsidiaries Segment Information Exhibit E (page 5 of 5)
All Other (5)
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Net investment income (2)
$
17,177
$
17,329
$
14,786
$
12,030
$
6,560
Net gains (losses) on investments and other financial instruments
356
283
95
80
47
Other income
14
9
(1
)
5
8
Total
17,547
17,621
14,880
12,115
6,615
Other operating expenses before allocated corporate operating expenses (3) (4)
3,903
3,500
3,370
518
(6)
3,606
Interest expense
1,421
1,609
400
77
14
Total (3)
5,324
5,109
3,770
595
3,620
Adjusted pretax operating income before allocated corporate operating expenses
12,223
12,512
11,110
11,520
2,995
Allocation of corporate operating expenses
410
354
413
3,315
(6)
420
Adjusted pretax operating income (loss)
$
11,813
$
12,158
$
10,697
$
8,205
$
2,575
(1)
Net of ceded premiums written under our quota share and excess-of-loss reinsurance agreements.
(2)
Effective in the fourth quarter of 2023, expenses associated with securities lending transactions that had previously been reported as a component of interest expense are now included in net investment income, along with the applicable income. Net investment income and interest expense, including allocated interest expense, for prior periods in 2023 have been restated to reflect this reclassification.
(3)
Includes immaterial inter-segment revenue for our homegenius segment and immaterial inter-segment expenses for our Mortgage Insurance segment and All Other activities.
(4)
Does not include impairment of long-lived assets and other non-operating items, which are not considered components of adjusted pretax operating income (loss).
(5)
All Other activities include: (i) income (losses) from assets held by our holding company; (ii) related general corporate operating expenses not attributable or allocated to our reportable segments; and (iii) certain investments in new business opportunities, including activities and investments associated with Radian Mortgage Capital, and other immaterial activities.
(6)
In the first quarter of 2023, as a one-time adjustment, we reclassified $2.9 million in cumulative expenses previously reflected in the All Other results as direct other operating expenses to allocated corporate operating expenses.
Selected Mortgage Insurance Key Ratios
2023
2022
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Loss ratio (1)
2.0
%
(3.5
)%
(10.3
)%
(7.3
)%
(18.9
)%
Expense ratio (2)
25.5
%
23.4
%
29.6
%
25.9
%
27.3
%
Years Ended December 31,
2023
2022
Loss ratio (1)
(4.6
)%
(35.5
)%
Expense ratio (2)
26.0
%
26.7
%
(1)
For our Mortgage Insurance segment, calculated as provision for losses expressed as a percentage of net premiums earned.
(2)
For our Mortgage Insurance segment, calculated as operating expenses, (which consist of policy acquisition costs and other operating expenses, as well as allocated corporate operating expenses), expressed as a percentage of net premiums earned.
Radian Group Inc. and Subsidiaries Definition of Consolidated Non-GAAP Financial Measures Exhibit F (page 1 of 2)
Use of Non-GAAP Financial Measures
In addition to the traditional GAAP financial measures, we have presented “adjusted pretax operating income (loss),” “adjusted diluted net operating income (loss) per share” and “adjusted net operating return on equity,” which are non-GAAP financial measures for the consolidated company, among our key performance indicators to evaluate our fundamental financial performance. These non-GAAP financial measures align with the way our business performance is evaluated by both management and by our board of directors. These measures have been established in order to increase transparency for the purposes of evaluating our operating trends and enabling more meaningful comparisons with our peers. Although on a consolidated basis adjusted pretax operating income (loss), adjusted diluted net operating income (loss) per share and adjusted net operating return on equity are non-GAAP financial measures, we believe these measures aid in understanding the underlying performance of our operations. Our senior management, including our Chief Executive Officer (Radian’s chief operating decision maker), uses adjusted pretax operating income (loss) as our primary measure to evaluate the fundamental financial performance of our business segments and to allocate resources to the segments.
Adjusted pretax operating income (loss) is defined as GAAP consolidated pretax income (loss) excluding the effects of: (i) net gains (losses) on investments and other financial instruments, except for certain investments and other financial instruments attributable to our reportable segments and All Other activities; (ii) amortization and impairment of goodwill and other acquired intangible assets; and (iii) impairment of other long-lived assets and other non-operating items, if any, such as gains (losses) from the sale of lines of business, acquisition-related income and expenses and gains (losses) on extinguishment of debt. Adjusted diluted net operating income (loss) per share is calculated by dividing adjusted pretax operating income (loss) attributable to common stockholders, net of taxes computed using the company’s statutory tax rate, by the sum of the weighted average number of common shares outstanding and all dilutive potential common shares outstanding. Adjusted net operating return on equity is calculated by dividing annualized adjusted pretax operating income (loss), net of taxes computed using the company’s statutory tax rate, by average stockholders’ equity, based on the average of the beginning and ending balances for each period presented.
Although adjusted pretax operating income (loss) excludes certain items that have occurred in the past and are expected to occur in the future, the excluded items represent those that are: (i) not viewed as part of the operating performance of our primary activities or (ii) not expected to result in an economic impact equal to the amount reflected in pretax income (loss). These adjustments, along with the reasons for their treatment, are described below.
(1)
Net gains (losses) on investments and other financial instruments. The recognition of realized investment gains or losses can vary significantly across periods as the activity is highly discretionary based on the timing of individual securities sales due to such factors as market opportunities, our tax and capital profile and overall market cycles. Unrealized gains and losses arise primarily from changes in the market value of our investments that are classified as trading or equity securities. These valuation adjustments may not necessarily result in realized economic gains or losses.
Trends in the profitability of our fundamental operating activities can be more clearly identified without the fluctuations of these realized and unrealized gains or losses and changes in fair value of other financial instruments. Except for certain investments and other financial instruments attributable to our reportable segments and All Other activities, we do not view them to be indicative of our fundamental operating activities.
(2)
Amortization and impairment of goodwill and other acquired intangible assets. Amortization of acquired intangible assets represents the periodic expense required to amortize the cost of acquired intangible assets over their estimated useful lives. Acquired intangible assets are also periodically reviewed for potential impairment, and impairment adjustments are made whenever appropriate. We do not view these charges as part of the operating performance of our primary activities.
(3)
Impairment of other long-lived assets and other non-operating items, if any. Impairment of other long-lived assets and other non-operating items includes activities that we do not view to be indicative of our fundamental operating activities, such as: (i) impairment of internal-use software and other long-lived assets; (ii) gains (losses) from the sale of lines of business; (iii) acquisition-related income and expenses; and (iv) gains (losses) on extinguishment of debt.
Radian Group Inc. and Subsidiaries Definition of Consolidated Non-GAAP Financial Measures Exhibit F (page 2 of 2)
See Exhibit G for the reconciliations of the most comparable GAAP measures, consolidated pretax income (loss), diluted net income (loss) per share and return on equity to our non-GAAP financial measures for the consolidated company, adjusted pretax operating income (loss), adjusted diluted net operating income (loss) per share and adjusted net operating return on equity, respectively.
Total adjusted pretax operating income (loss), adjusted diluted net operating income (loss) per share and adjusted net operating return on equity should not be considered in isolation or viewed as substitutes for GAAP pretax income (loss), diluted net income (loss) per share, return on equity or net income (loss). Our definitions of adjusted pretax operating income (loss) and adjusted diluted net operating income (loss) per share may not be comparable to similarly-named measures reported by other companies.
Radian Group Inc. and Subsidiaries Consolidated Non-GAAP Financial Measure Reconciliations Exhibit G (page 1 of 4)
Reconciliation of Consolidated Pretax Income to Adjusted Pretax Operating Income
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Consolidated pretax income
$
179,817
$
200,983
$
182,676
$
204,011
$
203,298
Less reconciling income (expense) items
Net gains (losses) on investments and other financial instruments (1)
13,091
(8,838
)
(331
)
5,505
6,798
Impairment of goodwill
(9,802
)
—
—
—
—
Amortization of other acquired intangible assets
(1,371
)
(1,371
)
(1,370
)
(1,371
)
(1,587
)
Impairment of other long-lived assets and other non-operating items
(13,835
)
(2)
737
2
14
(14,929
)
(2)
Total adjusted pretax operating income (3)
$
191,734
$
210,455
$
184,375
$
199,863
$
213,016
(1)
Excludes certain net gains (losses), if any, on investments and other financial instruments that are attributable to specific operating segments and therefore included in adjusted pretax operating income (loss).
(2)
These amounts are included in other operating expenses on the Condensed Consolidated Statement of Operations in Exhibit A and primarily relate to impairment of other long-lived assets.
(3)
Total adjusted pretax operating income consists of adjusted pretax operating income (loss) for each reportable segment and All Other activities as follows.
2023
2022
(In thousands)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Adjusted pretax operating income (loss)
Mortgage Insurance segment
$
197,797
$
218,601
$
197,750
$
214,435
$
241,907
homegenius segment
(17,876
)
(20,932
)
(24,421
)
(23,041
)
(31,466
)
All Other activities
11,813
12,786
11,046
8,469
2,575
Total adjusted pretax operating income
$
191,734
$
210,455
$
184,375
$
199,863
$
213,016
Radian Group Inc. and Subsidiaries Consolidated Non-GAAP Financial Measure Reconciliations Exhibit G (page 2 of 4)
Reconciliation of Diluted Net Income Per Share to Adjusted Diluted Net Operating Income Per Share
2023
2022
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Diluted net income per share
$
0.91
$
0.98
$
0.91
$
0.98
$
1.01
Less per-share impact of reconciling income (expense) items
Net gains (losses) on investments and other financial instruments
0.08
(0.06
)
—
0.03
0.04
Impairment of goodwill
(0.06
)
—
—
—
—
Amortization of other acquired intangible assets
(0.01
)
(0.01
)
(0.01
)
(0.01
)
(0.01
)
Impairment of other long-lived assets and other non-operating items
(0.09
)
0.01
—
—
(0.09
)
Income tax (provision) benefit on reconciling income (expense) items (1)
0.02
0.01
—
(0.01
)
0.01
Difference between statutory and effective tax rates
0.01
(0.01
)
0.01
(0.01
)
0.01
Per-share impact of reconciling income (expense) items
(0.05
)
(0.06
)
—
—
(0.04
)
Adjusted diluted net operating income per share (1)
$
0.96
$
1.04
$
0.91
$
0.98
$
1.05
(1)
Calculated using the company’s federal statutory tax rate of 21%. Any permanent tax adjustments and state income taxes on these items have been deemed immaterial and are not included.
Reconciliation of Return on Equity to Adjusted Net Operating Return on Equity (1)
2023
2022
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
Return on equity (1)
13.4
%
15.0
%
14.1
%
15.7
%
17.0
%
Less impact of reconciling income (expense) items (2)
Net gains (losses) on investments and other financial instruments
1.2
(0.9
)
—
0.5
0.7
Impairment of goodwill
(0.9
)
—
—
—
—
Amortization of other acquired intangible assets
(0.1
)
(0.2
)
(0.1
)
(0.1
)
(0.2
)
Impairment of other long-lived assets and other non-operating items
(1.3
)
0.1
—
—
(1.6
)
Income tax (provision) benefit on reconciling income (expense) items (3)
0.2
0.2
(0.1
)
(0.1
)
0.2
Difference between statutory and effective tax rates
0.1
(0.2
)
0.2
(0.3
)
0.3
Impact of reconciling income (expense) items
(0.8
)
(1.0
)
—
—
(0.6
)
Adjusted net operating return on equity (3)
14.2
%
16.0
%
14.1
%
15.7
%
17.6
%
(1)
Calculated by dividing annualized net income by average stockholders’ equity, based on the average of the beginning and ending balances for each period presented.
(2)
Annualized, as a percentage of average stockholders’ equity.
(3)
Calculated using the company’s federal statutory tax rate of 21%. Any permanent tax adjustments and state income taxes on these items have been deemed immaterial and are not included.
Radian Group Inc. and Subsidiaries Consolidated Non-GAAP Financial Measure Reconciliations Exhibit G (page 3 of 4)
Reconciliation of Consolidated Pretax Income to Adjusted Pretax Operating Income
Years Ended December 31,
(In thousands)
2023
2022
Consolidated pretax income
$
767,487
$
952,779
Less reconciling income (expense) items:
Net gains (losses) on investments and other financial instruments (1)
9,427
(80,780
)
Impairment of goodwill
(9,802
)
—
Amortization of other acquired intangible assets
(5,483
)
(4,308
)
Impairment of other long-lived assets and other non-operating items (2)
(13,082
)
(14,850
)
Total adjusted pretax operating income (3)
$
786,427
$
1,052,717
(1)
Excludes certain net gains (losses), if any, on investments and other financial instruments that are attributable to specific operating segments and therefore included in adjusted pretax operating income (loss).
(2)
The amounts primarily relate to impairments of other long-lived assets that are included in other operating expenses on the Condensed Consolidated Statement of Operations in Exhibit A.
(3)
Total adjusted pretax operating income consists of adjusted pretax operating income (loss) for each reportable segment and All Other activities as follows:
Years Ended December 31,
(In thousands)
2023
2022
Adjusted pretax operating income (loss):
Mortgage Insurance segment
$
829,824
$
1,131,943
homegenius segment
(86,270
)
(88,198
)
All Other activities
42,873
8,972
Total adjusted pretax operating income
$
786,427
$
1,052,717
Reconciliation of Diluted Net Income Per Share to Adjusted Diluted Net Operating Income Per Share
Years Ended December 31,
2023
2022
Diluted net income per share
$
3.77
$
4.35
Less per-share impact of reconciling income (expense) items:
Net gains (losses) on investments and other financial instruments
0.06
(0.47
)
Impairment of goodwill
(0.06
)
—
Amortization of other acquired intangible assets
(0.03
)
(0.03
)
Impairment of other long-lived assets and other non-operating items
(0.08
)
(0.09
)
Income tax (provision) benefit on reconciling income (expense) items (1)
0.02
0.12
Difference between statutory and effective tax rates
(0.02
)
(0.05
)
Per-share impact of reconciling income (expense) items
(0.11
)
(0.52
)
Adjusted diluted net operating income per share (1)
$
3.88
$
4.87
(1)
Calculated using the company’s federal statutory tax rate of 21%. Any permanent tax adjustments and state income taxes on these items have been deemed immaterial and are not included.
Radian Group Inc. and Subsidiaries Consolidated Non-GAAP Financial Measure Reconciliations Exhibit G (page 4 of 4)
Reconciliation of Return on Equity to Adjusted Net Operating Return on Equity (1)
Years Ended December 31,
2023
2022
Return on equity (1)
14.5
%
18.2
%
Less impact of reconciling income (expense) items: (2)
Net gains (losses) on investments and other financial instruments
0.2
(2.0
)
Impairment of goodwill
(0.2
)
—
Amortization of other acquired intangible assets
(0.1
)
(0.1
)
Impairment of other long-lived assets and other non-operating items
(0.3
)
(0.4
)
Income tax (provision) benefit on reconciling income (expense) items (3)
0.1
0.5
Difference between statutory and effective tax rates
(0.1
)
(0.1
)
Impact of reconciling income (expense) items
(0.4
)
(2.1
)
Adjusted net operating return on equity (3)
14.9
%
20.3
%
(1)
Calculated by dividing net income by average stockholders’ equity.
(2)
As a percentage of average stockholders’ equity.
(3)
Calculated using the company’s federal statutory tax rate of 21%. Any permanent tax adjustments and state income taxes on these items have been deemed immaterial and are not included.
On a consolidated basis, “adjusted pretax operating income (loss),” “adjusted diluted net operating income (loss) per share” and “adjusted net operating return on equity” are measures not determined in accordance with GAAP. These measures should not be considered in isolation or viewed as substitutes for GAAP pretax income (loss), diluted net income (loss) per share, return on equity or net income (loss).
Our definitions of adjusted pretax operating income (loss), adjusted diluted net operating income (loss) per share and adjusted net operating return on equity may not be comparable to similarly-named measures reported by other companies. See Exhibit F for additional information on our consolidated non-GAAP financial measures.
Radian Group Inc. and Subsidiaries Mortgage Insurance Supplemental Information - New Insurance Written Exhibit H
2023
2022
($ in millions)
Qtr 4
Qtr 3
Qtr 2
Qtr 1
Qtr 4
NIW
$
10,629
$
13,922
$
16,946
$
11,261
$
12,859
NIW by premium type
Direct monthly and other recurring premiums
96.4
%
96.0
%
96.5
%
94.9
%
94.8
%
Direct single premiums
3.6
%
4.0
%
3.5
%
5.1
%
5.2
%
NIW for purchases
98.8
%
98.7
%
98.6
%
97.6
%
98.3
%
NIW for refinances
1.2
%
1.3
%
1.4
%
2.4
%
1.7
%
NIW by FICO score (1)
>=740
66.5
%
67.3
%
66.1
%
60.7
%
59.4
%
680-739
27.9
27.4
28.4
32.8
33.1
620-679
5.6
5.3
5.5
6.5
7.5
<=619
—
—
—
—
—
Total NIW
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
NIW by LTV
95.01% and above
15.4
%
16.5
%
17.9
%
17.7
%
15.5
%
90.01% to 95.00%
40.0
38.6
39.1
40.2
40.8
85.01% to 90.00%
31.3
30.2
29.5
28.7
29.7
85.00% and below
13.3
14.7
13.5
13.4
14.0
Total NIW
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
(1)
For loans with multiple borrowers, the percentage of NIW by FICO score represents the lowest of the borrowers’ FICO scores.
Radian Group Inc. and Subsidiaries Mortgage Insurance Supplemental Information - Primary Insurance in Force and Risk in Force Exhibit I
December 31,
September 30,
June 30,
March 31,
December 31,
($ in millions)
2023
2023
2023
2023
2022
Primary insurance in force
$
269,979
$
269,511
$
266,859
$
261,450
$
260,994
Primary risk in force (“RIF”)
$
69,710
$
69,298
$
68,323
$
66,580
$
66,094
Primary RIF by premium type
Direct monthly and other recurring premiums
88.9
%
88.6
%
88.2
%
87.6
%
87.1
%
Direct single premiums
11.1
%
11.4
%
11.8
%
12.4
%
12.9
%
Primary RIF by FICO score (1)
>=740
58.5
%
58.2
%
57.8
%
57.4
%
57.4
%
680-739
33.9
34.0
34.3
34.6
34.6
620-679
7.3
7.4
7.5
7.6
7.6
<=619
0.3
0.4
0.4
0.4
0.4
Total
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
Primary RIF by LTV
95.01% and above
18.6
%
18.4
%
18.0
%
17.5
%
17.1
%
90.01% to 95.00%
48.2
48.2
48.4
48.5
48.4
85.01% to 90.00%
27.1
27.0
26.9
27.0
27.2
85.00% and below
6.1
6.4
6.7
7.0
7.3
Total
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
Primary RIF by policy year
2008 and prior
2.8
%
2.9
%
3.1
%
3.3
%
3.5
%
2009 - 2017
6.9
7.5
8.2
9.1
10.0
2018
2.8
2.9
3.1
3.3
3.5
2019
5.4
5.6
5.9
6.4
6.7
2020
16.6
17.5
18.7
20.3
21.6
2021
24.5
25.6
26.9
28.6
29.5
2022
22.4
22.8
23.6
24.7
25.2
2023
18.6
15.2
10.5
4.3
—
Total
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
Persistency Rate (12 months ended)
84.0
%
83.6
%
82.8
%
81.6
%
79.6
%
Persistency Rate (quarterly, annualized) (2)
85.8
%
84.2
%
83.5
%
84.4
%
84.1
%
(1)
For loans with multiple borrowers, the percentage of primary RIF by FICO score represents the lowest of the borrowers’ FICO scores.
(2)
The Persistency Rate on a quarterly, annualized basis is calculated based on loan-level detail for the quarter ending as of the date shown. It may be impacted by seasonality or other factors, including the level of refinance activity during the applicable periods and may not be indicative of full-year trends.
FORWARD-LOOKING STATEMENTS
All statements in this press release that address events, developments or results that we expect or anticipate may occur in the future are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the U.S. Private Securities Litigation Reform Act of 1995. In most cases, forward-looking statements may be identified by words such as “anticipate,” “may,” “will,” “could,” “should,” “would,” “expect,” “intend,” “plan,” “goal,” “contemplate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “seek,” “strategy,” “future,” “likely” or the negative or other variations on these words and other similar expressions. These statements, which may include, without limitation, projections regarding our future performance and financial condition, are made on the basis of management’s current views and assumptions with respect to future events. These statements speak only as of the date they were made, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. We operate in a changing environment where new risks emerge from time to time and it is not possible for us to predict all risks that may affect us. The forward-looking statements are not guarantees of future performance, and the forward-looking statements, as well as our prospects as a whole, are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in the forward-looking statements. These risks and uncertainties include, without limitation:
For more information regarding these risks and uncertainties as well as certain additional risks that we face, you should refer to “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022, and to subsequent reports and registration statements filed from time to time with the U.S. Securities and Exchange Commission. We caution you not to place undue reliance on these forward-looking statements, which are current only as of the date on which we issued this press release. We do not intend to, and we disclaim any duty or obligation to, update or revise any forward-looking statements to reflect new information or future events or for any other reason.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240202390040/en/
For Investors John Damian - Phone: 215.231.1383 email: john.damian@radian.com
For Media Rashi Iyer - Phone: 215.231.1167 email: rashi.iyer@radian.com
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