Skip to main content

Radian Announces Fourth Quarter and Full Year 2023 Financial Results

— 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

  • NIW was $10.6 billion in the fourth quarter of 2023, compared to $13.9 billion in the third quarter of 2023, and $12.9 billion in the fourth quarter of 2022. NIW was $52.7 billion for the full year 2023, compared to $68.0 billion for the prior year.
    • Purchase NIW decreased 24% in the fourth quarter of 2023 compared to the third quarter of 2023 and decreased 17% compared to the fourth quarter of 2022.
    • Refinances accounted for 1% of total NIW in the fourth quarter of 2023, compared to 1% in the third quarter of 2023, and 2% in the fourth quarter of 2022.
  • Total primary mortgage insurance in force of $270.0 billion as of December 31, 2023, increased slightly as compared to $269.5 billion as of September 30, 2023, and increased 3% compared to $261.0 billion as of December 31, 2022.
    • The year-over-year change reflects a 6% increase in monthly premium policy insurance in force and a 10% decline in single premium policy insurance in force.
    • Persistency, which is the percentage of mortgage insurance that remains in force after a twelve-month period, was 84% for the twelve months ended December 31, 2023, compared to 84% for the twelve months ended September 30, 2023, and 80% for the twelve months ended December 31, 2022.
    • Annualized persistency for the three months ended December 31, 2023, was 86%, compared to 84% for the three months ended September 30, 2023, and 84% for the three months ended December 31, 2022.
  • Net mortgage insurance premiums earned were $230 million for the fourth quarter of 2023, compared to $237 million for the third quarter of 2023, and $230 million for the fourth quarter of 2022.
    • Mortgage insurance in force portfolio premium yield was 38.1 basis points in the fourth quarter of 2023. This compares to 38.0 basis points in the third quarter of 2023, and 38.1 basis points in the fourth quarter of 2022.
    • The impact of single premium policy cancellations before consideration of reinsurance represented 0.3 basis points of direct premium yield in the fourth quarter of 2023, 0.5 basis points in the third quarter of 2023, and 0.9 basis points in the fourth quarter of 2022.
    • Total net mortgage insurance premium yield, which includes the impact of ceded premiums earned and accrued profit commission, was 34.2 basis points in the fourth quarter of 2023. This compares to 35.3 basis points in the third quarter of 2023, and 35.4 basis points in the fourth quarter of 2022.
    • Details regarding premiums earned may be found in Exhibit D.
  • The mortgage insurance provision for losses was $5 million in the fourth quarter of 2023, compared to benefits of $8 million and $44 million in the third quarter of 2023 and fourth quarter of 2022, respectively.
    • Favorable reserve development on prior period defaults was $49 million in the fourth quarter of 2023, compared to $55 million in the third quarter of 2023 and $90 million in the fourth quarter of 2022.
    • The number of primary delinquent loans was 22,021 as of December 31, 2023, compared to 20,406 as of September 30, 2023, and 21,913 as of December 31, 2022.
    • The loss ratio in the fourth quarter of 2023 was 2.0%, compared to (3.5)% in the third quarter of 2023, and (18.9)% in the fourth quarter of 2022.
    • Total mortgage insurance claims paid were $3 million in the fourth quarter of 2023, compared to $5 million in the third quarter of 2023, and $8 million in the fourth quarter of 2022. For the full year 2023, total net claims paid, which includes the impact of settlements and commutations, were $14 million, compared to $21 million for the full year 2022.
  • Radian’s homegenius segment offers an array of title, real estate and real estate technology products and services to consumers, mortgage lenders, mortgage and real estate investors, GSEs, real estate brokers and agents and corporations for their employees.
    • Total homegenius segment revenues for the fourth quarter of 2023 were $15 million, compared to $15 million for the third quarter of 2023, and $19 million for the fourth quarter of 2022. Total homegenius segment revenues for the full year of 2023 were $58 million, compared to $110 million for the full year of 2022.
    • Adjusted pretax operating loss, our primary segment measure of profitability for the homegenius segment, was $18 million for the fourth quarter of 2023, compared to $21 million for the third quarter of 2023, and $31 million for the fourth quarter of 2022. Adjusted pretax operating loss for the full year 2023 was $86 million, compared to $88 million for the full year 2022.
  • Other operating expenses were $95 million in the fourth quarter of 2023, compared to $79 million in the third quarter of 2023, and $110 million in the fourth quarter of 2022. Other operating expenses were $348 million for the full year 2023, compared to $381 million for the full year 2022.
    • Other operating expenses increased in the fourth quarter of 2023 as compared to the third quarter of 2023, primarily due to $14 million of impairments of long-lived assets and other non-operating items recognized in the fourth quarter of 2023, related to our lease-related assets and internal-use software.
    • Additional details regarding other operating expenses may be found in Exhibit D.

CAPITAL AND LIQUIDITY UPDATE

Radian Group

  • As of December 31, 2023, Radian Group maintained $992 million of available liquidity. Total holding company liquidity, including the company’s $275 million unsecured revolving credit facility, was $1.3 billion as of December 31, 2023.
  • Radian Group paid a dividend on its common stock in the amount of $0.225 per share, totaling $34 million on December 12, 2023. For the full year 2023, the company paid total dividends of $146 million.
  • During the fourth quarter of 2023, the company repurchased 2.4 million shares of Radian Group common stock at a total cost of $63 million, including commissions. For the full year 2023, the company repurchased 5.3 million shares of Radian Group common stock at a total cost of $133 million, including commissions. As of December 31, 2023, purchase authority of up to $167 million remained available under the existing program.

Radian Guaranty

  • In the fourth quarter of 2023, Radian Guaranty paid an ordinary dividend to Radian Group of $100 million, bringing the total ordinary dividends paid from Radian Guaranty to Radian Group during the year to $400 million.
  • At December 31, 2023, Radian Guaranty’s Available Assets under PMIERs totaled approximately $5.9 billion, resulting in PMIERs excess Available Assets of $2.3 billion, compared to $1.7 billion as of September 30, 2023.
  • As previously announced, in October 2023, Radian Guaranty improved its capital position and enhanced its risk distribution program with the closing of two risk distribution transactions.
    • A fully collateralized mortgage insurance-linked-note reinsurance transaction, in which the company obtained $353 million of aggregate excess-of-loss reinsurance coverage from Eagle Re 2023-1 Ltd. on mortgage insurance losses on an existing portfolio of eligible policies with RIF of $8.8 billion that were issued between April 1, 2022, and December 31, 2022.
    • A traditional excess-of-loss reinsurance agreement, in which the company obtained $246 million of aggregate excess-of-loss reinsurance coverage from a panel of third-party reinsurers on mortgage insurance losses on an existing portfolio of eligible policies with RIF of $8.0 billion that were issued between October 1, 2021, and March 31, 2022.

RECENT EVENTS

  • On January 8, 2024, S&P Global Ratings (“S&P”) upgraded the insurance financial strength (IFS) rating of Radian Guaranty to A- from BBB+. In the same rating action, S&P also upgraded the senior unsecured debt rating of Radian Group Inc. to BBB- from BB+. The outlook for the ratings is stable.

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:

  • the health of the U.S. housing market generally and changes in economic conditions that