Radian Group Inc., a US-based company primarily known for mortgage insurance, has received all regulatory approvals required for its pending acquisition of Inigo Limited, a specialty insurance group underwriting through Lloyd’s of London.The transaction is expected to close in February 2026, subject to the satisfaction of customary closing conditions.This deal will mark an important step for Radiant as it expands beyond mortgage insurance into a broader, multi-line specialty insurance business.The acquisiti ...

All statements in this press release that address events, developments or results that Radian expects or anticipates 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 ...

Key Takeaways Radian Group plans to buy Inigo for $1.7B to expand into global multi-line specialty insurance. New business, higher persistency and a strong mortgage insurance portfolio support growth. Declining claims and a strengthened capital base back RDN's dividend hikes and buybacks. Shares of Radian Group Inc. (RDN) closed at $35.66 on Dec. 1, near its 52-week high of $38.84. This proximity underscores investor confidence. It has the ingredients for further price appreciation. The stock is trading abo ...

Group 1 - Radian Group Inc.'s subsidiary, Radian Guaranty, has agreed to a $373 million excess of loss reinsurance arrangement with highly rated third-party providers [1][2] - The reinsurance agreement is part of Radian's broader risk distribution strategy to manage capital and mitigate risk, covering policies written from 2016 to 2021 [2] - The agreement is expected to close in December 2025, with an effective date of December 1st, 2025 [2] Group 2 - In September 2025, Radian Group acquired Inigo Limited, a Lloyd's specialty insurer, in a transaction valued at $1.7 billion, primarily in cash [3] - The acquisition was funded using Radian's available liquidity and capital from its subsidiaries, leading to a 'BBB-' rating on Radian and an 'A-' rating on Radian Guaranty being placed on CreditWatch with a developing outlook by S&P Global Ratings [3] - The rationale behind the acquisition was to enhance business diversification and create growth opportunities beyond its US mortgage insurance operations [4]

Core Viewpoint - Radian Group Inc. has announced a new excess of loss (XOL) reinsurance arrangement through its subsidiary, Radian Guaranty Inc., with a panel of highly rated third-party reinsurance providers, aimed at enhancing risk management and capital distribution strategies [1] Group 1: Reinsurance Arrangement - The agreement is focused on principal terms for an excess of loss reinsurance arrangement [1] - This arrangement is part of the company's broader strategy to manage capital effectively and mitigate risks proactively [1] - The agreement is still subject to final documentation, indicating that it is not yet fully finalized [1]

Financial Performance - The company reported a net income of $150 million for the quarter, representing a 20% increase year-over-year[10]. - The projected earnings guidance for the next quarter is set at $160 million, reflecting a 7% growth[10]. - Net income for Q3 2025 was $141,443,000, compared to $151,892,000 in Q3 2024, resulting in a diluted net income per share of $1.03, up from $0.99 in the previous year[21]. - Comprehensive income for Q3 2025 was $187,966,000, down from $296,103,000 in Q3 2024, reflecting a decrease in other comprehensive income[22]. - Net income from continuing operations for the three months ended September 30, 2025, was $152,802 thousand, compared to $166,555 thousand for the same period in 2024, reflecting a decrease of about 8%[62]. - Radian Guaranty reported statutory net income of $550,343,000 for the nine months ended September 30, 2025, compared to $588,122,000 for the same period in 2024, reflecting a decrease of approximately 6.5%[183]. Insurance Operations - New insurance written (NIW) reached $1.2 billion, up 15% compared to the previous quarter[11]. - The persistency rate for insurance in force (IIF) improved to 85%, indicating strong customer retention[12]. - The company reported a decrease in the Persistency Rate of mortgage insurance on Monthly Premium Policies, which could impact future revenue streams[14]. - Total direct primary mortgage insurance in force (IIF) was $280.6 billion and risk in force (RIF) was $74.0 billion as of September 30, 2025, compared to $275.1 billion and $72.1 billion as of December 31, 2024, representing increases of 2.0% and 2.6% respectively[35]. - The loss ratio for the Mortgage Insurance segment increased to 7.5% in Q3 2025 from 2.7% in Q3 2024[69]. Strategic Initiatives - The company plans to expand its market presence by entering three new states by Q3 2024[9]. - The company announced a strategic partnership with a leading fintech firm to enhance digital offerings[11]. - The company plans to divest its Mortgage Conduit, Title, and Real Estate Services businesses, which may impact operational strategies and timelines[14]. - Radian Group announced plans to divest its Mortgage Conduit, Title, and Real Estate Services businesses, with the divestiture expected to be completed no later than the third quarter of 2026[31][37]. - The anticipated acquisition of Inigo is subject to regulatory approvals and may affect the company's strategic direction as a global multi-line specialty insurer[14]. Financial Position - Total assets available for claims increased to $2.5 billion, up 12% from the previous quarter[10]. - Total assets decreased from $8,689,535 thousand as of December 31, 2024, to $8,204,803 thousand as of September 30, 2025, representing a decline of approximately 5.6%[19]. - Total liabilities decreased from $4,065,677 thousand to $3,552,354 thousand, a reduction of approximately 12.6%[19]. - Retained earnings increased from $4,695,348 thousand to $5,012,742 thousand, showing a growth of about 6.7%[19]. - The balance of total stockholders' equity at the end of Q3 2025 was $4,652,449,000, a decrease from $4,698,853,000 at the end of Q3 2024[24]. Investment and Cash Flow - Total investments increased from $5,701,831 thousand to $5,852,034 thousand, reflecting a growth of about 2.6%[19]. - Cash flows from operating activities for continuing operations were $546,211,000 in the first nine months of 2025, compared to $508,527,000 in the same period of 2024[27]. - The company reported net cash used in investing activities of $(1,790,000) for continuing operations in the first nine months of 2025, contrasting with a net cash provided of $313,360,000 in the same period of 2024[27]. - The company reported net realized losses on investments sold or redeemed of $5,275 for the nine months ended September 30, 2025[102]. Risk Management - The company is implementing a new risk management framework aimed at reducing claim severity by 5% over the next year[12]. - The company is facing risks related to the quality of third-party mortgage underwriting and servicing, which could affect financial performance[14]. - The company faces risks from changes in the U.S. housing market and economic conditions that could affect its mortgage portfolio and overall business prospects[14]. - Radian Guaranty is subject to various capital and financial requirements imposed by GSEs and state insurance regulators, which may limit the amount of insurance that can be written[36]. Shareholder Returns - The company declared dividends totaling $35,531,000 in Q3 2025, slightly down from $37,774,000 in Q3 2024[24]. - Dividends declared per share for 2025 totaled $0.765, compared to $0.980 in 2024[172]. - Common stock outstanding decreased from 151,148 thousand shares in Q3 2024 to 135,473 thousand shares in Q3 2025, reflecting a repurchase of 13,417 thousand shares year-to-date[166]. - Radian Group paused share repurchases to ensure adequate funds for the planned acquisition of Inigo[168].

Core Viewpoint - Radian Group (RDN) shares have shown moderate performance over the past year, with a gain of approximately 5% [1] - Following a transformative acquisition announcement, shares have pulled back about 9% from recent highs in September, raising concerns about future performance [1] Company Performance - Radian Group's stock has increased by around 5% over the last year [1] - The stock experienced a decline of approximately 9% from its recent peak in September [1] Market Sentiment - There are increasing concerns regarding the trajectory of Radian Group following the acquisition announcement [1]

Core Viewpoint - Radian Group (RDN) shares have shown moderate performance over the past year, with a gain of approximately 5% [1] - Following a transformative acquisition announcement, shares have pulled back about 9% from recent highs in September due to rising concerns about future performance [1] Company Performance - Over the last year, Radian Group's shares increased by around 5% [1] - The stock experienced a decline of approximately 9% from its peak in September after the acquisition announcement [1] Market Sentiment - There are increasing concerns regarding the trajectory of Radian Group following the acquisition [1]

Financial Data and Key Metrics Changes - Radian achieved net income from continuing operations of $153 million, or $1.11 per diluted share, consistent with the previous quarter [13] - Net income including discontinued operations was $141 million in the third quarter [13] - Return on equity (ROE) was 12.4% including discontinued operations, and 13.4% for continuing operations, reflecting a 100 basis points increase [13][14] - Book value per share grew 9% year over year to $34.34 [14] Business Line Data and Key Metrics Changes - Total revenues for the third quarter were $303 million [15] - Net premiums earned reached $237 million, the highest level in over three years [15] - The mortgage insurance in-force portfolio grew to an all-time high of $281 billion, with $15.5 billion of new insurance written, a 15% increase year-over-year [15][16] - Persistency rate remained strong at 84% [15] Market Data and Key Metrics Changes - The investment portfolio totaled $6 billion, generating net investment income of $63 million [17] - The number of new defaults was approximately 13,400, a decline of 2% from the same period last year [17] - Total defaults increased to approximately 24,000 loans, resulting in a portfolio default rate of 2.42% [17] Company Strategy and Development Direction - Radian is transitioning from a leading U.S. mortgage insurer to a global multi-line specialty insurer, with the acquisition of Inigo as a key strategic move [7][10] - The divestiture plan for mortgage conduit, title, and real estate services businesses is underway, with completion expected by the third quarter of next year [6][12] - The acquisition of Inigo is valued at $1.7 billion, funded through available liquidity and excess capital [8][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the mortgage insurance business, citing strong credit characteristics and favorable market conditions [4][18] - The outlook remains positive, with expectations for stable in-force premium yield and continued strong persistency rates [16][18] - Management emphasized the importance of maintaining a disciplined approach to underwriting and capital allocation [9][10] Other Important Information - Radian has returned nearly $3 billion of capital to stockholders through dividends and share repurchases since 2017 [5] - The company expects to maintain strong liquidity, with available holding company liquidity growing to $995 million by quarter-end [21] - The leverage ratio declined to 18.7%, with expectations to remain below 20% by year-end 2026 [22] Q&A Session Summary Question: Should the 200 basis points increase be added to the current run rate ROE? - Management confirmed that a 200 basis points increase on the current operating ROE of 13.9% is reasonable [26][27] Question: What potential capital benefits could arise from using unearned premiums at Radian as capital at Inigo? - Management indicated that future details on potential synergies and reinsurance opportunities will be provided post-acquisition [28][29] Question: How should capital freed up from divesting non-core businesses be viewed? - The carrying value of the three businesses is estimated at $170 million, with no significant gains or losses expected [33][34] Question: What are the key steps to return to the buyback program? - Management outlined that excess liquidity is expected to return within a few quarters post-Inigo acquisition, allowing for a revisit of the share repurchase strategy [36][37] Question: What is the timing of the divestitures? - Management confirmed that the divestiture process is on track to be completed by the third quarter of next year [41][42] Question: What would it take to move the claim rate below 7.5%? - Management stated that the current claim rate is a through-the-cycle assumption, and no changes are expected in the near future [44][46] Question: Has anything changed post-COVID affecting claim rate trends? - Management noted that home equity growth and improved borrower assistance processes have positively influenced cure rates since COVID [47][49]

Financial Data and Key Metrics Changes - Radian reported net income from continuing operations of $153 million, or $1.11 per diluted share, consistent with the previous quarter [12] - The company achieved a return on equity (ROE) of 12.4%, with a higher ROE of 13.4% for continuing operations [12] - Book value per share grew by 9% year over year to $34.34 [12] - Total revenues for the quarter were $303 million, with net premiums earned reaching $237 million, the highest level in over three years [13] Business Line Data and Key Metrics Changes - The mortgage insurance in-force portfolio grew to an all-time high of $281 billion, with new insurance written increasing by 15% year over year to $15.5 billion [13][14] - The persistency rate for the mortgage insurance portfolio remained strong at 84% [13] - The in-force premium yield remained stable at 38 basis points [14] Market Data and Key Metrics Changes - The number of new defaults in the third quarter was approximately 13,400, a decline of 2% from the same period last year [15] - Total defaults increased to approximately 24,000 loans, resulting in a portfolio default rate of 2.42% [15] - The company maintained a default-to-claim rate of 7.5%, resulting in a loss provision of $53 million for new defaults [17] Company Strategy and Development Direction - Radian is transitioning from a leading U.S. mortgage insurer to a global multi-line specialty insurer, with the acquisition of Indigo as a key strategic move [6][9] - The divestiture plan for non-core businesses is underway, with expectations to complete the process by the third quarter of next year [5][11] - The acquisition of Indigo, valued at $1.7 billion, is expected to double earned premiums and expand the total addressable market by 12 times [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the mortgage insurance business, highlighting strong credit performance and the resilience of the portfolio [4][23] - The company anticipates maintaining strong persistency rates due to a significant portion of the insurance portfolio having mortgage rates of 5% or lower [14] - Management remains vigilant regarding credit trends in other asset classes but sees positive performance in the mortgage segment [16] Other Important Information - Radian has returned nearly $3 billion of capital to stockholders through dividends and share repurchases since 2017 [5] - The company expects to maintain strong liquidity, with available holding company liquidity growing to $995 million by quarter-end [19] - The company has revised its expense run rate guidance for continuing operations to approximately $250 million for the full year 2025 [18] Q&A Session Summary Question: Should the 200 basis points increase be added to the current run rate ROE? - Management indicated that a 200 basis points increase on the current operating ROE of 13.9% is reasonable [25][26] Question: What are the potential capital benefits from using unearned premiums at Radian as capital at Indigo? - Management noted that future details on potential synergies and reinsurance opportunities between the MI business and Indigo will be shared post-transaction [27][28] Question: How should capital freed up from divesting non-core businesses be viewed? - Management stated that the carrying value of the three businesses is approximately $170 million, with no significant gains or losses expected [33][34] Question: What are the key steps to return to the buyback program? - Management outlined that excess liquidity is expected within a few quarters post-Indigo acquisition, which will allow for a revisit of the share repurchase strategy [35][38] Question: What is the timing of the divestitures? - Management confirmed that the divestiture process is on track to be completed by the third quarter of next year, with significant interest from potential buyers [42][43] Question: What would it take to move the claim rate below 7.5%? - Management explained that the current claim rate is a through-the-cycle assumption, and they do not expect changes in the near future [45][46] Question: Has anything changed post-COVID affecting cure rates? - Management noted that home equity growth and improved borrower assistance processes have positively influenced cure rates since COVID [49][50]