Radian(RDN) - 2025 Q2 - Quarterly Report

Cover Page The report is a quarterly filing by Radian Group Inc. for the period ended June 30, 2025, with 135,450,446 common shares outstanding as of July 30, 2025 Form 10-Q Filing Information This report is Radian Group Inc.'s quarterly filing (Form 10-Q) for the period ended June 30, 2025, registered in Delaware, trading on the NYSE under RDN, with 135,450,446 common shares outstanding as of July 30, 2025 - Radian Group Inc. submitted its quarterly report (Form 10-Q) for the period ended June 30, 2025[2] - The company has filed all required reports within the past 12 months, complied with filing requirements within the past 90 days, and electronically submitted all interactive data files[3] - The company is designated as a "Large Accelerated Filer"[3] Company Basic Information | Metric | Content | | :--- | :--- | | Registrant Name | Radian Group Inc. | | Jurisdiction of Incorporation | Delaware | | Trading Symbol | RDN | | Exchange | New York Stock Exchange | | Common Shares Outstanding as of July 30, 2025 | 135,450,446 shares | Table of Contents The report follows the standard SEC Form 10-Q structure, including a glossary, forward-looking statements, financial information, and other disclosures Report Structure This report adheres to the standard SEC Form 10-Q structure, encompassing a glossary, forward-looking statements, Part I Financial Information (unaudited financial statements and MD&A), and Part II Other Information (legal proceedings, risk factors, equity security sales, and exhibits) - The report includes a glossary of abbreviations, cautionary note regarding forward-looking statements, financial information (Items 1-4), and non-financial information (Items 1-6)[6] Glossary of Abbreviations and Acronyms for Selected References This section defines various abbreviations and acronyms used throughout the report to aid reader comprehension Definitions of Key Terms This section provides definitions for various abbreviations and acronyms used in the report, covering reinsurance agreements (e.g., QSR, XOL), financial instruments (e.g., ABS, CLO, CMBS), regulatory bodies (e.g., FASB, FHFA, GSEs, SEC), and company-specific business terms (e.g., IIF, NIW, PMIERs, RIF) - This section defines various abbreviations and acronyms used in the report to help readers understand specialized terminology[7][8] - Terms covered include reinsurance agreements (e.g., 2024 QSR Agreement, 2023 XOL Agreement), financial instruments (e.g., ABS, CLO, CMBS), regulatory bodies (e.g., FASB, FHFA, GSEs, SEC), and company business metrics (e.g., IIF, NIW, PMIERs, RIF)[9][10][11][13] Cautionary Note Regarding Forward-Looking Statements—Safe Harbor Provisions This section warns that forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties Nature and Risks of Forward-Looking Statements This section cautions that forward-looking statements in the report are not guarantees of future performance and are subject to various risks and uncertainties that could cause actual results to differ materially from expectations, with the company disclaiming any obligation to update or revise them - All forward-looking statements in the report are based on management's current views and assumptions and are not guarantees of future performance[14] - The company undertakes no obligation to update or revise any forward-looking statements[14][16] - Major risks and uncertainties include: * Changes in the health of the U.S. housing market and economic conditions (inflationary pressures, interest rate environment, recession risk, rising unemployment)[14] * Government actions, regulatory and legislative changes, and their impact on financial markets[15] * Changes in perceptions of the company's performance, financial strength, and future prospects by customers, investors, rating agencies, regulators, or legislators[17] * Radian Guaranty's ability to maintain PMIERs qualification[17] * Ability to maintain adequate capital in insurance subsidiaries to meet regulatory requirements[17] * Changes in GSEs charters, business practices, or rules[17] * Changes in the U.S. housing finance system[17] * Ability to successfully execute capital plans and business strategies[17] * Risks related to the quality of third-party mortgage underwriting and loan servicing[17] * Decreased persistency rates for monthly premium policies[17] * Competition in the private mortgage insurance industry[17] * U.S. political conditions and legislative and regulatory activities[17] * Adverse judgments or fines from legal and regulatory claims and investigations[17] * Risk of failing to accurately estimate loss reserves for the mortgage insurance business[17] * Risks related to investment diversification and growth, including the development and acceptance of new technologies and digital product services[17] * Effectiveness and security of information technology systems and digital product services, including cybersecurity risks[17] * Ability of insurance subsidiaries to pay dividends to the parent company[17] * Changes in accounting standards or interpretations[17] PART I—FINANCIAL INFORMATION This section presents the unaudited consolidated financial statements and management's discussion and analysis of financial condition and results of operations Item 1 Financial Statements (Unaudited) This section provides Radian Group Inc.'s unaudited consolidated financial statements, including balance sheets, statements of operations, comprehensive income, changes in stockholders' equity, and cash flows, along with detailed notes covering business description, accounting policies, net income per share, segment reporting, fair value of financial instruments, investments, residential mortgage loans, reinsurance, other assets and liabilities, income taxes, losses and LAE, borrowings and financing activities, commitments and contingencies, capital stock, accumulated other comprehensive income, and statutory information Condensed Consolidated Balance Sheets (Unaudited) As of June 30, 2025, total assets were $9.58 billion, a 10.58% increase from December 31, 2024, with total liabilities at $5.09 billion, up 25.93%, and stockholders' equity at $4.49 billion, down 2.84% Condensed Consolidated Balance Sheets Key Data | Metric (Thousands of USD) | June 30, 2025 | December 31, 2024 | Change Rate | | :--- | :--- | :--- | :--- | | Assets | | | | | Total Investments | 6,484,692 | 6,345,236 | 2.20% | | Cash | 22,090 | 38,823 | -43.10% | | Restricted Cash | 105 | 2,649 | -96.03% | | Prepaid Federal Income Taxes | 997,805 | 921,080 | 8.33% | | Consolidated VIE Assets | 1,402,312 | 721,307 | 94.41% | | Total Assets | 9,580,657 | 8,663,988 | 10.58% | | Liabilities | | | | | Loss and LAE Reserves | 383,103 | 360,326 | 6.32% | | Unearned Premiums | 171,901 | 188,337 | -8.73% | | Senior Notes | 1,066,603 | 1,065,337 | 0.12% | | Secured Borrowings | 762,933 | 538,294 | 41.73% | | Net Deferred Tax Liabilities | 841,376 | 746,685 | 12.68% | | Consolidated VIE Liabilities | 1,371,895 | 709,595 | 93.33% | | Total Liabilities | 5,087,976 | 4,040,130 | 25.93% | | Stockholders' Equity | | | | | Common Stock | 157 | 168 | -6.67% | | Treasury Stock | (988,764) | (968,246) | -2.12% | | Additional Paid-in Capital | 847,399 | 1,246,826 | -32.05% | | Retained Earnings | 4,906,830 | 4,695,348 | 4.50% | | Accumulated Other Comprehensive Income (Loss) | (272,941) | (350,238) | 22.10% | | Total Stockholders' Equity | 4,492,681 | 4,623,858 | -2.84% | Condensed Consolidated Statements of Operations (Unaudited) For the three months ended June 30, 2025, total revenue was $318 million, down 0.98%, with net income at $142 million, down 6.65%, and diluted net income per share at $1.02, up 4.08%; for the six months, total revenue was $636 million, down 0.70%, with net income at $286 million, down 5.88%, and diluted net income per share at $2.00, up 2.04% Condensed Consolidated Statements of Operations Key Data | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenue | | | | | | | | Net Premiums Earned | 237,520 | 237,731 | -0.09% | 474,199 | 473,588 | 0.13% | | Service Revenue | 10,924 | 13,265 | -17.50% | 23,040 | 25,853 | -10.96% | | Net Investment Income | 72,769 | 73,766 | -1.35% | 141,343 | 142,987 | -1.15% | | Net Gains (Losses) on Investments and Other Financial Instruments | (4,852) | (4,487) | -8.13% | (5,575) | (3,997) | -39.48% | | Gains (Losses) from Consolidated VIEs | 185 | — | N/A | 613 | — | N/A | | Other Revenue | 1,458 | 872 | 67.20% | 2,498 | 2,134 | 17.06% | | Total Revenue | 318,004 | 321,147 | -0.98% | 636,118 | 640,565 | -0.70% | | Expenses | | | | | | | | Provision for Losses | 12,097 | (1,745) | N/A | 27,264 | (8,779) | N/A | | Policy Acquisition Costs | 7,205 | 6,522 | 10.47% | 13,593 | 13,316 | 2.08% | | Service Costs | 8,418 | 9,535 | -11.71% | 17,189 | 18,862 | -8.87% | | Other Operating Expenses | 89,397 | 91,648 | -2.46% | 166,246 | 174,284 | -4.61% | | Interest Expense | 25,874 | 27,064 | -4.40% | 48,373 | 56,110 | -13.80% | | Total Expenses | 142,991 | 133,024 | 7.49% | 272,665 | 253,793 | 7.44% | | Income Before Income Taxes | 175,013 | 188,123 | -6.97% | 363,453 | 386,772 | -6.03% | | Income Tax Expense | 33,217 | 36,220 | -8.29% | 77,099 | 82,515 | -6.56% | | Net Income | 141,796 | 151,903 | -6.65% | 286,354 | 304,257 | -5.88% | | Net Income Per Share | | | | | | | | Basic | 1.03 | 0.99 | 4.04% | 2.02 | 1.98 | 2.02% | | Diluted | 1.02 | 0.98 | 4.08% | 2.00 | 1.96 | 2.04% | Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) For the three months ended June 30, 2025, comprehensive income was $164 million, up 19.32%, and for the six months, it was $364 million, up 40.98%, primarily due to a significant increase in unrealized gains on investments Condensed Consolidated Statements of Comprehensive Income (Loss) Key Data | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net Income | 141,796 | 151,903 | -6.65% | 286,354 | 304,257 | -5.88% | | Other Comprehensive Income (Loss), Net of Tax | | | | | | | | Unrealized Gains (Losses) on Investments | 21,775 | (14,815) | N/A | 77,252 | (46,392) | N/A | | Other Adjustments | — | — | N/A | 45 | (68) | N/A | | Comprehensive Income (Loss) | 163,571 | 137,088 | 19.32% | 363,651 | 257,797 | 40.98% | Condensed Consolidated Statements of Changes in Common Stockholders' Equity (Unaudited) For the six months ended June 30, 2025, total stockholders' equity decreased to $4.49 billion from $4.62 billion at the beginning of the period, primarily due to $434 million in share repurchases and $74.87 million in dividend payments, partially offset by $286 million in net income and $77.25 million in unrealized investment gains Condensed Consolidated Statements of Changes in Common Stockholders' Equity Key Data (Six Months) | Metric (Thousands of USD) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total Stockholders' Equity, Beginning of Period | 4,623,858 | 4,482,319 | | Net Income | 286,354 | 304,257 | | Dividends and Dividend Equivalents | (74,872) | (77,681) | | Share Repurchases | (433,967) | (100,680) | | Net Unrealized Gains (Losses) on Investments | 77,252 | (46,392) | | Other Comprehensive Income (Loss) Adjustments | 45 | (68) | | Total Stockholders' Equity, End of Period | 4,492,681 | 4,482,319 | Condensed Consolidated Statements of Cash Flows (Unaudited) For the six months ended June 30, 2025, operating activities resulted in a $646 million cash outflow, primarily due to increased net purchases of residential mortgage loans held for sale; investing activities generated $231 million in cash inflow, mainly from securities sales and redemptions and principal payments on securitized residential mortgage loans; and financing activities generated $395 million in cash inflow, primarily from the issuance of securitized non-recourse debt and net increases in secured borrowings, partially offset by share repurchases and dividend payments Condensed Consolidated Statements of Cash Flows Key Data (Six Months) | Cash Flow Type (Thousands of USD) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (645,529) | (156,238) | | Net Cash from Investing Activities | 231,310 | (74,433) | | Net Cash from Financing Activities | 394,942 | 226,390 | | Net Increase (Decrease) in Cash and Restricted Cash | (19,277) | (4,281) | | Cash and Restricted Cash, End of Period | 22,195 | 15,784 | - Operating cash outflow increased, primarily due to net purchases of residential mortgage loans held for sale rising from $428 million in the first half of 2024 to $949 million in the first half of 2025[325] - Investing cash inflow increased, mainly from principal payments on securitized residential mortgage loans and reduced net purchases of available-for-sale fixed maturity securities and short-term investments[326] - Financing cash inflow primarily resulted from the issuance of securitized non-recourse debt and net increases in secured borrowings, partially offset by share repurchases and dividend payments[327] Note 1 - Description of Business Radian Group Inc. is a mortgage and real estate company primarily providing credit-related insurance through its mortgage insurance business and offering other products and services to the real estate and mortgage finance industries, with one reportable segment: Mortgage Insurance, and other activities categorized as "All Other" - The company's primary business is mortgage insurance, providing private mortgage insurance for residential first-lien mortgage loans through Radian Guaranty[30][31] - Mortgage insurance plays a vital role in the U.S. housing finance system by protecting mortgage lenders and investors from default-related losses and facilitating the sale of low down payment loans in the secondary mortgage market[32] - Radian Guaranty is subject to various capital and financial requirements from GSEs and state insurance regulators, including PMIERs financial requirements and risk-based capital ratios and other risk capital measures[34] - The "All Other" category includes operating results from mortgage conduit, title, real estate services, and real estate technology businesses[35] Mortgage Insurance Key Metrics | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Direct Primary Mortgage IIF | $276.7 billion | $275.1 billion | | Direct Primary Mortgage RIF | $72.8 billion | $72.1 billion | Note 2 - Significant Accounting Policies This note outlines the basis of preparation for the company's condensed consolidated financial statements, which comply with GAAP, and include accounts of Radian Group and its subsidiaries, emphasizing that interim financial information is unaudited but reflects necessary adjustments and is not indicative of full-year results, while also disclosing unadopted accounting standard updates - The condensed consolidated financial statements are prepared in accordance with GAAP and include the accounts of Radian Group and its subsidiaries, with all intercompany accounts and transactions eliminated[37] - Interim financial information is unaudited but reflects normal recurring adjustments deemed necessary by management[40] - The company is evaluating the impact of ASU 2023-09 (Income Tax Disclosures Improvements) and ASU 2024-03 (Expense Disaggregation on the Income Statement) on annual disclosures and does not expect a material impact on its consolidated financial statements[44][45] Note 3 - Net Income Per Share This note details the calculation of basic and diluted net income per share, reporting basic net income per share of $1.03 and diluted of $1.02 for the three months ended June 30, 2025, and basic of $2.02 and diluted of $2.00 for the six months ended June 30, 2025 - Basic net income per share is calculated by dividing net income by the weighted-average number of common shares outstanding, while diluted net income per share considers dilutive potential common shares[46] Net Income Per Share Calculation | Metric (Thousands of USD, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income—Basic and Diluted | 141,796 | 151,903 | 286,354 | 304,257 | | Weighted-Average Common Shares Outstanding—Basic | 137,376 | 153,110 | 141,910 | 153,879 | | Dilutive Effect (Share-Based Payment Arrangements) | 984 | 1,289 | 1,102 | 1,392 | | Adjusted Weighted-Average Common Shares Outstanding—Diluted | 138,360 | 154,399 | 143,012 | 155,271 | | Net Income Per Share—Basic | 1.03 | 0.99 | 2.02 | 1.98 | | Net Income Per Share—Diluted | 1.02 | 0.98 | 2.00 | 1.96 | Note 4 - Segment Reporting The company operates with one reportable segment, Mortgage Insurance, while other non-reportable business activities are grouped under "All Other"; management uses adjusted pre-tax operating income (loss) as the primary measure for evaluating business performance and resource allocation, with Mortgage Insurance reporting $190 million in adjusted pre-tax operating income and "All Other" reporting a $16.36 million adjusted pre-tax operating loss for the three months ended June 30, 2025 - The company has one reportable segment: Mortgage Insurance, with revenue primarily derived from mortgage insurance; non-reportable segments and activities are grouped under "All Other," including mortgage conduit, title, real estate services, and real estate technology businesses[49] - Adjusted pre-tax operating income (loss) is the primary measure used by the company's management to assess the underlying financial performance of its businesses and allocate resources[52] Adjusted Pre-Tax Operating Income (Loss) | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Mortgage Insurance Adjusted Pre-Tax Operating Income | 189,522 | 198,763 | 383,815 | 408,613 | | All Other Adjusted Pre-Tax Operating Income (Loss) | (16,361) | (6,080) | (19,820) | (13,113) | | Net Gains (Losses) on Investments and Other Financial Instruments (Adjustments) | 1,852 | (4,438) | (158) | (4,331) | | Other Non-Operating Items (Adjustments) | — | (122) | (384) | (4,397) | | Consolidated Income Before Income Taxes | 175,013 | 188,123 | 363,453 | 386,772 | Mortgage Insurance Segment Key Information | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Mortgage Insurance Total Revenue | 288,316 | 285,983 | 572,614 | 571,006 | | Provision for Losses | 11,954 | (1,769) | 27,294 | (8,655) | | Policy Acquisition Costs | 7,205 | 6,522 | 13,593 | 13,316 | | Direct Other Operating Expenses | 19,874 | 17,157 | 36,441 | 34,427 | | Allocated Corporate Operating Expenses | 42,328 | 43,197 | 77,451 | 77,706 | | Interest Expense | 17,428 | 21,957 | 33,917 | 45,290 | | Adjusted Pre-Tax Operating Income | 189,522 | 198,763 | 383,815 | 408,613 | | Loss Ratio | 5.1% | (0.8)% | 5.8% | (1.8)% | | Expense Ratio | 29.7% | 28.5% | 27.3% | 26.8% | Service Revenue Disaggregation | Service Type (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Mortgage Insurance Underwriting Services | 42 | 309 | 215 | 519 | | Real Estate Services (Valuation) | 2,447 | 4,086 | 6,226 | 8,561 | | Real Estate Services (Single-Family Rental) | 1,245 | 2,368 | 3,095 | 4,728 | | Title | 4,013 | 3,540 | 7,274 | 6,113 | | Real Estate Technology | 682 | 639 | 1,310 | 1,251 | | Total Service Revenue | 10,924 | 13,265 | 23,040 | 25,853 | Note 5 - Fair Value of Financial Instruments This note discloses the company's fair value measurement methods and hierarchy for financial instruments, with total assets at $8.06 billion and total liabilities at $1.36 billion at fair value as of June 30, 2025, where most instruments like fixed maturity securities and residential mortgage loans held for sale are classified as Level 2, while equity securities and mortgage servicing rights include Level 3 assets Fair Value of Assets and Liabilities by Level (June 30, 2025) | (Thousands of USD) | Level 1 | Level 2 | Level 3 | Total | | :--- | :--- | :--- | :--- | :--- | | Investments | | | | | | Available-for-Sale Fixed Maturity Securities | 130,575 | 4,977,703 | — | 5,108,278 | | Trading Fixed Maturity Securities | — | 74,317 | — | 74,317 | | Equity Securities | 80,146 | 6,299 | 6,546 | 92,991 | | Residential Mortgage Loans Held for Sale | — | 698,367 | — | 698,367 | | Short-Term Investments | 335,979 | 166,522 | — | 502,501 | | Total Fair Value of Investments | 546,700 | 5,923,208 | 12,634 | 6,482,542 | | Other Assets | | | | | | Derivative Assets | — | 2,826 | — | 2,826 | | Mortgage Servicing Rights | — | — | 4,600 | 4,600 | | Securities Lending | 48,927 | 130,765 | — | 179,744 | | Securitized Residential Mortgage Loans Held for Investment | — | 1,394,700 | — | 1,394,700 | | Total Fair Value of Assets | 595,627 | 7,451,499 | 17,234 | 8,064,360 | | Liabilities | | | | | | Derivative Liabilities | — | 667 | 868 | 1,535 | | Securitized Non-Recourse Debt | — | 1,360,195 | — | 1,360,195 | | Total Fair Value of Liabilities | — | 1,360,862 | 868 | 1,361,730 | Financial Instruments Not Measured at Fair Value (June 30, 2025) | (Thousands of USD) | Carrying Value | Estimated Fair Value | | :--- | :--- | :--- | | Company-Owned Life Insurance | 113,529 | 113,529 | | Senior Notes | 1,066,603 | 1,099,765 | | Secured Borrowings | 762,933 | 762,968 | - The fair value of company-owned life insurance is estimated based on cash surrender value less applicable surrender charges and is classified as Level 2[75] - The fair value of senior notes is estimated based on market quotes, and secured borrowings are estimated based on current market rates and contractual cash flows, both classified as Level 2[76] Note 6 - Investments This note details the company's investment portfolio, including available-for-sale, trading, equity, and short-term investments; as of June 30, 2025, available-for-sale fixed maturity securities had a fair value of $5.11 billion, with total unrealized losses of $379 million, and net investment income for the three months ended June 30, 2025, was $72.77 million, a 1.35% decrease year-over-year Available-for-Sale Securities (June 30, 2025) | (Thousands of USD) | Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | | :--- | :--- | :--- | :--- | :--- | | U.S. Government and Agency Securities | 164,513 | 126 | (29,270) | 135,369 | | State and Municipal Bonds | 159,695 | 167 | (16,375) | 143,487 | | Corporate Bonds and Notes | 2,767,925 | 17,288 | (230,241) | 2,554,972 | | RMBS | 1,063,500 | 8,628 | (80,619) | 991,509 | | CMBS | 343,420 | 37 | (18,073) | 325,384 | | CLO | 480,161 | 862 | (580) | 480,443 | | Other ABS | 559,833 | 4,055 | (3,467) | 560,421 | | Mortgage Insurance-Linked Notes | 45,384 | 1,436 | — | 46,820 | | Total Available-for-Sale Fixed Maturity Securities | 5,449,992 | 32,599 | (378,625) | 5,108,278 | - As of June 30, 2025, 850 securities were in an unrealized loss position, which the company believes are due to non-credit factors, and it intends to hold these securities until amortized cost is recovered[84] Net Investment Income | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Fixed Maturity Securities Investment Income | 57,835 | 57,924 | 114,549 | 115,183 | | Equity Securities Investment Income | 2,634 | 3,067 | 4,779 | 5,606 | | Residential Mortgage Loans Held for Sale Investment Income | 10,064 | 5,411 | 16,337 | 7,204 | | Short-Term Investments Income | 3,409 | 8,614 | 8,160 | 17,572 | | Other Investment Income | 1,860 | 1,504 | 3,433 | 3,101 | | Investment Expenses | (3,033) | (2,754) | (5,915) | (5,679) | | Net Investment Income | 72,769 | 73,766 | 141,343 | 142,987 | Net Gains (Losses) on Investments and Other Financial Instruments | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Realized Gains (Losses) on Investments | (2,053) | (3,019) | (3,487) | (6,701) | | Net Unrealized Gains (Losses) on Investments | 1,310 | (1,829) | 1,978 | 419 | | Net Gains (Losses) on Residential Mortgage Loans Held for Sale | (6,704) | (50) | (5,417) | 334 | | Net Gains (Losses) on Other Financial Instruments | 2,591 | 281 | 2,288 | 2,058 | | Net Gains (Losses) on Investments and Other Financial Instruments | (4,852) | (4,487) | (5,575) | (3,997) | - The company participates in a securities lending program, with $180 million of investment securities loaned to third-party borrowers as of June 30, 2025[95] Note 7 - Residential Mortgage Loans Radian Mortgage Capital acquires residential mortgage loans for sale or distribution through private securitizations; as of June 30, 2025, residential mortgage loans held for sale had a carrying value of $698 million, primarily non-agency loans; the company completed two private securitization transactions in the first half of 2025 and consolidated the assets and liabilities of the associated variable interest entities (VIEs), with a net retained interest in consolidated VIEs of $30.42 million as of June 30, 2025 - Radian Mortgage Capital acquires residential mortgage loans with the intent to sell them directly to mortgage investors or distribute them through private securitizations[99] - As of June 30, 2025, residential mortgage loans held for sale had a carrying value of $698 million, consisting primarily of 832 mortgage loans, with 99% originated in the past six months and 24% located in California[102][103] - Radian Mortgage Capital completed two private securitization transactions in the first half of 2025, issuing a total of $764 million in mortgage pass-through securities[113] - The company consolidates the variable interest entities (VIEs) from these securitization transactions into its financial statements, with a net retained interest in consolidated VIEs of $30.42 million as of June 30, 2025[114][118][120] Net Gains (Losses) on Residential Mortgage Loans Held for Sale (Net of Hedging Activities) | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Realized Gains (Losses) on Residential Mortgage Loans Held for Sale | (1,857) | (64) | (6,296) | 309 | | Net Unrealized Gains (Losses) on Residential Mortgage Loans Held for Sale | (4,212) | (1,753) | 885 | (1,399) | | Net Gains (Losses) on Mortgage Loan Hedging Activities | (2,492) | 1,703 | (6,302) | 1,733 | | Net Gains (Losses) on Residential Mortgage Loans Held for Sale (Net of Hedging Activities) | (6,704) | (50) | (5,417) | 334 | Gains (Losses) from Consolidated VIEs | (Thousands of USD) | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Net Change in Fair Value of VIE Assets and Liabilities | (385) | (698) | | Interest Income | 17,505 | 32,364 | | Interest Expense | (16,245) | (29,814) | | Other Expenses | (690) | (1,239) | | Total Gains (Losses) from Consolidated VIEs | 185 | 613 | Note 8 - Reinsurance The company utilizes reinsurance through Quota Share (QSR) and Excess of Loss (XOL) programs to manage capital and risk; for the six months ended June 30, 2025, net premiums earned were $474 million, with ceded premiums net of commissions totaling $56.39 million; new QSR agreements for 2025, 2026, and 2027 are expected to cede 30%, 30%, and 15% of new insurance written, respectively, and reinsurance programs provide $1.39 billion in PMIERs minimum required asset relief - The company uses reinsurance in its mortgage insurance and title insurance businesses as part of its risk-sharing strategy to manage capital positions and risk profiles[123] - The company finalized terms for three new quota share reinsurance agreements (2025, 2026, and 2027 QSR Agreements) in the second quarter of 2025, expected to cede 30%, 30%, and 15% of new insurance written, respectively[138] Impact of Reinsurance on Net Premiums Earned | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Direct Premiums Earned | 266,146 | 264,421 | 530,785 | 527,076 | | Ceded Premiums Earned | (28,626) | (26,690) | (56,586) | (53,488) | | Total Net Premiums Earned | 237,520 | 237,731 | 474,199 | 473,588 | QSR Program Key Information (June 30, 2025) | QSR Agreement | NIW Policy Dates | Effective Date | Scheduled Termination Date | Quota Share Percentage | Ceding Commission Percentage | Profit Commission Percentage | RIF Ceded (Millions of USD) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | 2024 QSR | July 1, 2024 - June 30, 2025 | July 1, 2024 | June 30, 2035 | 25% | 20% | Up to 59% | 3,043 | | 2023 QSR | July 1, 2023 - June 30, 2024 | July 1, 2023 | June 30, 2034 | 22.5% | 20% | Up to 55% | 2,362 | | 2022 QSR | January 1, 2022 - June 30, 2023 | July 1, 2022 | June 30, 2033 | 20% | 20% | Up to 59% | 3,823 | | 2020 Single Premium QSR | January 1, 2020 - December 31, 2021 | January 1, 2020 | December 31, 2031 | 65% | 25% | Up to 56% | 1,436 | | 2018 Single Premium QSR | January 1, 2018 - December 31, 2019 | January 1, 2018 | December 31, 2029 | 65% | 25% | Up to 56% | 629 | | 2016 Single Premium QSR | January 1, 2012 - December 31, 2017 | January 1, 2016 | December 31, 2027 | 18%-57% | 25% | Up to 55% | 833 | XOL Program Key Information (June 30, 2025) | XOL Program | NIW Policy Dates | Initial RIF (Millions of USD) | Remaining Coverage (Millions of USD) | First Loss Retention (Millions of USD) | | :--- | :--- | :--- | :--- | :--- | | Eagle Re 2023-1 Ltd. | April 1, 2022 - December 31, 2022 | 8,782 | 294 | 285 | | Eagle Re 2021-2 Ltd. | January 1, 2021 - July 31, 2021 | 10,758 | 199 | 241 | | Eagle Re 2021-1 Ltd. | August 1, 2020 - December 31, 2020 | 11,061 | 117 | 221 | | 2023 XOL Agreement | October 1, 2021 - March 31, 2022 | 8,002 | 137 | 240 | PMIERs Risk Sharing Benefit | Item (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | XOL Programs (Mortgage Insurance-Linked Notes) | 460,257 | 558,939 | | XOL Programs (Traditional Reinsurance Agreements) | 132,485 | 160,742 | | Other QSR Agreements | 634,464 | 572,229 | | Single Premium QSR Programs | 163,744 | 172,968 | | Total PMIERs Impact (Minimum Required Asset Relief) | 1,390,950 | 1,464,878 | | Percentage of Total Minimum Required Assets | 25.9% | 27.4% | Note 9 - Other Assets and Liabilities This note lists the components of the company's other assets and liabilities; as of June 30, 2025, total other assets were $409 million, primarily comprising securities lending, company-owned life insurance, and prepaid reinsurance premiums, while total other liabilities were $490 million, mainly including payables under securities lending agreements, reinsurance funds withheld, and securities payable Other Assets Components | (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Securities Lending | 179,692 | 139,121 | | Company-Owned Life Insurance | 113,529 | 110,968 | | Prepaid Reinsurance Premiums | 61,760 | 72,472 | | Other | 53,694 | 53,370 | | Total Other Assets | 408,675 | 375,931 | Other Liabilities Components | (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Payables Under Securities Lending Agreements | 164,529 | 125,723 | | Reinsurance Funds Withheld | 128,165 | 121,983 | | Securities Payable | 34,218 | — | | Lease Liabilities | 33,784 | 37,442 | | Accrued Compensation | 31,321 | 55,971 | | Current Federal Income Taxes | 25,807 | 23,290 | | Other | 72,341 | 67,147 | | Total Other Liabilities | 490,165 | 431,556 | Note 10 - Income Taxes The company calculates interim income taxes using the estimated effective tax rate method; as of June 30, 2025, it held $998 million in prepaid federal income taxes, primarily related to U.S. mortgage guarantee tax and loss bonds; the newly enacted "One Big Beautiful Bill Act" made permanent changes to U.S. tax law but is not expected to materially impact the company's consolidated financial statements - The company calculates interim income taxes using the estimated effective tax rate method, except for certain unusual or reliably estimable items[160] - As of June 30, 2025, the company held $998 million in prepaid federal income taxes, primarily for U.S. mortgage guarantee tax and loss bonds, used to offset tax benefits from statutory contingency reserves[162] - The newly enacted "One Big Beautiful Bill Act" permanently reinstated 100% bonus depreciation and immediate expensing of domestic R&D costs but is not expected to have a material impact on the company's consolidated financial statements[163] Note 11 - Losses and LAE As of June 30, 2025, total loss and LAE reserves were $383 million, with $377 million attributed to mortgage insurance; for the six months ended June 30, 2025, the provision for losses was $27.26 million, influenced by an increase in new default notices and favorable prior-period default reserve development, with new default notices up 5% year-over-year, but higher-than-expected cure rates due to rising home prices positively impacted loss reserves Loss and LAE Reserves | (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Primary Case | 356,895 | 336,553 | | Primary IBNR and LAE | 14,076 | 13,399 | | Pool and Other | 6,261 | 4,479 | | Mortgage Insurance | 377,232 | 354,431 | | Title Insurance | 5,871 | 5,895 | | Total Loss and LAE Reserves | 383,103 | 360,326 | Provision for Losses | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Mortgage Insurance | 11,954 | (1,769) | 27,294 | (8,655) | | Title Insurance | 143 | 24 | (30) | (124) | | Total Provision for Losses | 12,097 | (1,745) | 27,264 | (8,779) | - For the six months ended June 30, 2025, the number of new primary default notices was 23,972, a 5% increase from 22,860 in the same period of 2024, primarily due to the natural seasoning of the insurance portfolio[172] - The company's gross default claim rate assumption for new defaults was 7.5% (June 30, 2025) and 8.0% (June 30, 2024), reflecting ongoing monitoring of cure trends and claim payments[173] - In the first half of 2025 and 2024, the provision for losses was positively impacted by favorable prior-period default reserve development, mainly due to better-than-expected cure trends driven by rising home prices[174] - As of June 30, 2025, the primary default rate was 2.3%, lower than 2.4% as of December 31, 2024[304][308] - The company's weighted-average net default claim rate assumption used to estimate loss reserves was 25% (June 30, 2025) and 23% (December 31, 2024)[309] Primary Default Loan Rollforward (Six Months) | (Thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Default Inventory, Beginning of Period | 24,055 | 22,021 | | New Defaults | 23,972 | 22,860 | | Cures | (25,394) | (24,280) | | Claims Paid | (294) | (277) | | Rescissions and Claim Denials | (81) | (48) | | Default Inventory, End of Period | 22,258 | 20,276 | Net Claims Paid | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Primary Claims | 5,122 | 2,896 | 9,325 | 5,150 | | Pool and Other Claims | (2) | 21 | (921) | 6 | | LAE | 945 | 1,048 | 1,894 | 2,196 | | Debt Offsets and Settlements | 924 | 1,552 | 924 | 1,552 | | Total Net Claims Paid | 6,989 | 5,517 | 11,222 | 8,904 | | Average Net Primary Claim Payment | 40.6 | 36.5 | 34.0 | 29.0 | Note 12 - Borrowings and Financing Activities As of June 30, 2025, the company's total debt (excluding securitized non-recourse debt) was $1.07 billion, primarily comprising senior notes due 2027 ($448 million) and 2029 ($619 million); secured borrowings totaled $763 million, mainly for mortgage loan financing; interest expense for the six months ended June 30, 2025, was $48.37 million, down 13.80% year-over-year, and the company was in compliance with all debt covenants Borrowings | (Thousands of USD) | Interest Rate | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | :--- | | Senior Notes | | | | | Senior Notes Due 2027 | 4.875% | 448,011 | 447,461 | | Senior Notes Due 2029 | 6.200% | 618,592 | 617,876 | | Total Senior Notes | | 1,066,603 | 1,065,337 | | Secured Borrowings | | | | | Mortgage Loan Financing Facilities | 6.028% | 664,248 | 492,429 | | FHLB Advances | | 98,685 | 45,865 | | Total Secured Borrowings | | 762,933 | 538,294 | Interest Expense | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Senior Notes | 15,810 | 21,156 | 31,610 | 43,284 | | Mortgage Loan Financing Facilities | 8,446 | 5,108 | 14,456 | 6,546 | | FHLB Advances | 877 | 544 | 1,302 | 1,489 | | Revolving Credit Facility | 741 | 256 | 1,005 | 516 | | Loss on Debt Extinguishment | — | — | — | 4,275 | | Total Interest Expense | 25,874 | 27,064 | 48,373 | 56,110 | - Radian Mortgage Capital finances the acquisition of residential mortgage loans through master repurchase agreements; as of June 30, 2025, $691 million of residential mortgage loans held for sale were pledged as collateral[180][183] - The company has an unsecured revolving credit facility of $275 million, with no outstanding amounts as of June 30, 2025[185] - As of June 30, 2025, the company was in compliance with all debt covenants[186] Note 13 - Commitments and Contingencies The company is routinely involved in various legal proceedings and regulatory inquiries; management believes that the outcome of currently pending or threatened litigation will not have a material adverse effect on the company's consolidated financial position or results of operations - The company is routinely involved in legal proceedings, regulatory reviews, audits, investigations, and other disputes arising in the ordinary course of business[187] - Management believes that the outcome of currently pending or threatened litigation will not have a material adverse effect on the company's consolidated financial position or results of operations[188] Note 14 - Capital Stock As of June 30, 2025, the company had 135,395 thousand common shares outstanding; during the six months ended June 30, 2025, the company repurchased 13,417 thousand common shares at a total cost of $430 million; the Board of Directors authorized an increase in the quarterly dividend to $0.255 per share, and this note also provides a rollforward of Restricted Stock Units (RSUs), including grants, vesting, and forfeitures for performance-based and time-based RSUs - For the six months ended June 30, 2025, the company repurchased 13,417 thousand common shares at a total cost of $430 million[193][340] - The company's Board of Directors authorized an additional $750 million in share repurchases in May 2025, effective upon exhaustion or expiration of the existing authorization[194] - The company's Board of Directors authorized an increase in the quarterly dividend from $0.245 to $0.255 per share in February 2025[196] - In the second quarter of 2025, the company recognized $10 million in compensation cost for RSUs granted to retirement-eligible grantees, as these awards are no longer subject to time-based service restrictions[318] Common Stock Share Count Changes (Six Months) | (Thousands of Shares) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Common Shares Outstanding, Beginning of Period | 147,569 | 153,179 | | Shares Repurchased Under Share Repurchase Programs | (13,417) | (3,344) | | Common Stock Issued Under Incentive and Benefit Plans (Net of Employee Taxes) | 1,243 | 1,313 | | Common Shares Outstanding, End of Period | 135,395 | 151,148 | Dividends Declared and Paid | Quarter | 2025 | 2024 | | :--- | :--- | :--- | | March 31 | $0.255 | $0.245 | | June 30 | $0.255 | $0.245 | | September 30 | N/A | $0.245 | | December 31 | N/A | $0.245 | | Total Annual Dividends | $0.510 | $0.980 | Note 15 - Accumulated Other Comprehensive Income (Loss) As of June 30, 2025, accumulated other comprehensive income (loss) improved to negative $273 million from negative $350 million as of December 31, 2024, primarily due to an increase in unrealized gains on investments, net of tax, of $77.25 million Accumulated Other Comprehensive Income (Loss) Rollforward (Six Months) | (Thousands of USD) | June 30, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Beginning Balance | (350,238) | (330,851) | | Net Unrealized Gains (Losses) on Investments | 77,252 | (46,392) | | Other Adjustments | 45 | (68) | | Ending Balance | (272,941) | (377,311) | - For the six months ended June 30, 2025, net unrealized gains (losses) on investments of $77.25 million positively impacted accumulated other comprehensive income[205] Note 16 - Statutory Information For the six months ended June 30, 2025, Radian Guaranty reported $360 million in statutory net income and $681 million in statutory policyholders' surplus; Radian Guaranty complies with all applicable statutory risk-based capital requirements and PMIERs financial requirements, with a risk-to-capital ratio of 10.3:1; the company paid a total of $400 million in dividends and capital returns to Radian Group in the first half of 2025 - Radian Guaranty complies with all applicable statutory risk-based capital requirements and PMIERs financial requirements, with its risk-to-capital ratio at 10.3:1 as of June 30, 2025[209][210] - As of June 30, 2025, Radian Guaranty's available assets under PMIERs were $6.0 billion, with a PMIERs buffer of $2.0 billion (51% above minimum required assets)[357] - Radian Guaranty made a $200 million capital return to Radian Group in the first quarter of 2025 and paid $200 million in ordinary dividends in the second quarter[213][214][330] Statutory Net Income (Six Months) | (Thousands of USD) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Radian Guaranty | 360,049 | 388,372 | | Other Mortgage Insurance Subsidiaries | 629 | (882) | | Radian Title Insurance | 1,192 | 1,015 | Statutory Policyholders' Surplus | (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Radian Guaranty | 681,204 | 722,861 | | Other Mortgage Insurance Subsidiaries | 16,518 | 16,515 | | Radian Title Insurance | 44,591 | 43,540 | Item 2 Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides a detailed analysis of the company's financial condition and operating results for the period ended June 30, 2025, compared to December 31, 2024, and the prior year, discussing the business operating environment, key influencing factors, mortgage insurance portfolio metrics, consolidated and segment operating results, liquidity and capital resources, and critical accounting estimates, noting strong mortgage industry fundamentals despite risks Overview of Business Operating Environment The company's performance as a mortgage and real estate firm is influenced by macroeconomic conditions, housing market fluctuations, interest rates, unemployment, and legislative and regulatory developments; despite risks, management believes mortgage industry fundamentals remain strong due to stricter underwriting standards and government support, with recent regulatory changes including GSEs credit scoring model updates and permanent income tax deduction for mortgage insurance premiums - The company's business performance is influenced by macroeconomic conditions, the housing market, interest rate environment, unemployment rates, and legislative and regulatory developments[222] - Despite risks and uncertainties, mortgage industry fundamentals remain strong, benefiting from stricter underwriting standards, high-quality borrowers, and government support[225] - The FHFA announced that GSEs will allow lenders to use Classic FICO or VantageScore 4.0 credit scoring models, and the company is evaluating its impact[227] - The "One Big Beautiful Bill Act" permanently reinstated the income tax deduction for borrower mortgage insurance premiums, effective from 2026, expected to support affordable homeownership[228] Key Factors Affecting Our Results This section states that the key factors affecting the company's results remain materially unchanged from those disclosed in the 2024 Form 10-K - The key factors affecting the company's results are materially unchanged from those disclosed in the 2024 Form 10-K[229] Mortgage Insurance Portfolio Metrics For the three months ended June 30, 2025, New Insurance Written (NIW) increased 3% year-over-year to $14.33 billion, while six-month NIW decreased 6% to $23.82 billion; as of June 30, 2025, Insurance In Force (IIF) was $276.7 billion, and Risk In Force (RIF) was $72.8 billion; the 12-month persistency rate was 83.8%, consistent with the prior year, and reinsurance programs provide $1.39 billion in PMIERs minimum required asset relief - NIW grew 3% in Q2 2025, primarily due to a slight increase in purchase mortgage originations, while H1 NIW decreased 6% due to a flat purchase market and a decline in the company's market share in Q1[231] - As of June 30, 2025, 63% of IIF mortgage loans had interest rates of 6.0% or lower, below current market rates, which could increase refinancing volumes if mortgage rates decline, negatively impacting persistency and the IIF portfolio size[239] New Insurance Written (NIW) | Metric (Millions of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | NIW | 14,330 | 13,902 | 3.08% | 23,819 | 25,404 | -6.24% | | Primary Risk Underwritten | 3,771 | 3,541 | 6.50% | 6,226 | 6,507 | -4.29% | | Average Coverage | 26.3% | 25.5% | 0.8% | 26.1% | 25.6% | 0.5% | | NIW by Loan Purpose (Purchase) | 94.6% | 98.3% | -3.7% | 95.0% | 97.7% | -2.7% | | NIW by FICO Score (>=740) | 68.2% | 69.4% | -1.2% | 68.2% | 68.5% | -0.3% | | NIW by LTV (90.01% to 95.00%) | 44.0% | 37.2% | 6.8% | 43.0% | 38.8% | 4.2% | Insurance and Risk In Force (IIF and RIF) | Metric (Millions of USD) | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | | Primary IIF | 276,745 | 275,126 | 272,827 | | Primary RIF | 72,820 | 72,074 | 71,109 | | Average Coverage | 26.3% | 26.2% | 26.1% | | Persistency Rate (as of 12 months) | 83.8% | 83.6% | 84.3% | | Persistency Rate (Quarterly, Annualized) | 83.8% | 82.7% | 83.5% | | Primary RIF by Premium Type (Monthly and Other Recurring Premiums) | 90.3% | 90.0% | 89.5% | | Primary RIF by FICO Score (>=740) | 60.6% | 60.1% | 59.2% | | Primary RIF by LTV (90.01% to 95.00%) | 48.0% | 47.9% | 48.1% | PMIERs Risk Sharing Benefit | Item (Thousands of USD) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | XOL Programs (Mortgage Insurance-Linked Notes) | 460,257 | 558,939 | | XOL Programs (Traditional Reinsurance Agreements) | 132,485 | 160,742 | | Other QSR Agreements | 634,464 | 572,229 | | Single Premium QSR Programs | 163,744 | 172,968 | | Total PMIERs Impact (Minimum Required Asset Relief) | 1,390,950 | 1,464,878 | | Percentage of Total Minimum Required Assets | 25.9% | 27.4% | Results of Operations—Consolidated For the three months ended June 30, 2025, consolidated income before income taxes was $175 million, down 6.97% year-over-year, with net income at $142 million, down 6.65%, and diluted net income per share at $1.02, up 4.08%; adjusted pre-tax operating income was $173 million, down 10.13%, and the company adjusted its non-GAAP financial metric calculation by no longer adjusting for differences between statutory and effective tax rates - The change in provision for losses was the primary driver of increased total expenses in the first half of 2025, mainly due to reduced favorable development from prior-period defaults[261] - Interest expense decreased, primarily due to a reduction in outstanding senior notes, partially offset by an increase in secured borrowings under mortgage loan financing facilities[262] - The effective tax rate was 21.2% in the first half of 2025, compared to 21.3% in the same period of 2024, primarily influenced by non-deductible executive compensation, state income taxes, and RSU vesting[264] - The company adjusted its non-GAAP financial metric calculation, no longer adjusting for differences between statutory and effective tax rates since Q1 2025, to enhance transparency[267][269] Consolidated Operating Results Summary | Metric (Thousands of USD, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 318,004 | 321,147 | -0.98% | 636,118 | 640,565 | -0.70% | | Total Expenses | 142,991 | 133,024 | 7.49% | 272,665 | 253,793 | 7.44% | | Income Before Income Taxes | 175,013 | 188,123 | -6.97% | 363,453 | 386,772 | -6.03% | | Net Income | 141,796 | 151,903 | -6.65% | 286,354 | 304,257 | -5.88% | | Diluted Net Income Per Share | 1.02 | 0.98 | 4.08% | 2.00 | 1.96 | 2.04% | | Adjusted Pre-Tax Operating Income | 173,161 | 192,683 | -10.13% | 363,995 | 395,500 | -8.09% | | Adjusted Diluted Net Operating Income Per Share | 1.01 | 1.01 | 0.00% | 2.01 | 2.00 | 0.50% | | Adjusted Net Operating Return on Equity | 12.4% | 13.9% | -1.5% | 12.6% | 14.0% | -1.4% | Results of Operations—Mortgage Insurance For the three months ended June 30, 2025, the Mortgage Insurance segment's total revenue was $288 million, up 0.81% year-over-year, with adjusted pre-tax operating income at $190 million, down 4.65%; net premiums earned slightly decreased, while net investment income increased due to higher investment yields; the provision for losses significantly increased due to reduced favorable prior-period default development, leading to a higher loss ratio, and other operating expenses rose due to increased share-based incentive compensation - Net investment income increased, driven by higher investment yields, offsetting a decrease in average investment balances[298] - In the first half of 2025, the number of new primary defaults increased 5% year-over-year, but favorable cure trends due to rising home prices positively impacted loss reserves[302][303] - Share-based incentive compensation increased, primarily due to higher estimated payouts for outstanding performance-based RSUs and the recognition of costs for RSUs granted to retirement-eligible grantees[318] Mortgage Insurance Segment Operating Results Summary | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 288,316 | 285,983 | 0.81% | 572,614 | 571,006 | 0.28% | | Provision for Losses | 11,954 | (1,769) | N/A | 27,294 | (8,655) | N/A | | Policy Acquisition Costs | 7,205 | 6,522 | 10.47% | 13,593 | 13,316 | 2.08% | | Other Operating Expenses | 62,202 | 60,354 | 3.06% | 113,892 | 112,133 | 1.57% | | Interest Expense | 17,428 | 21,957 | -20.63% | 33,917 | 45,290 | -25.11% | | Adjusted Pre-Tax Operating Income | 189,522 | 198,763 | -4.65% | 383,815 | 408,613 | -6.07% | Net Premiums Earned | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Direct Premiums Earned | 262,044 | 261,418 | 0.24% | 523,955 | 522,125 | 0.35% | | Ceded Premiums (Net of Profit Commission) | (28,518) | (26,600) | -7.21% | (56,385) | (53,308) | -5.78% | | Total Net Premiums Earned | 233,526 | 234,818 | -0.55% | 467,570 | 468,817 | -0.26% | | Portfolio Premium Yield (Basis Points) | 37.8 | 38.2 | -0.4 | 37.8 | 38.2 | -0.4 | | Net Premium Yield (Basis Points) | 33.9 | 34.5 | -0.6 | 33.9 | 34.5 | -0.6 | Provision for Losses | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Current Period Defaults | 47,912 | 47,918 | -0.01% | 103,750 | 100,986 | 2.74% | | Prior Period Defaults | (35,958) | (49,687) | 27.64% | (76,456) | (109,641) | 30.30% | | Total Provision for Losses | 11,954 | (1,769) | N/A | 27,294 | (8,655) | N/A | | Loss Ratio | 5.1% | (0.8)% | -5.9% | 11.7% | (1.8)% | -13.5% | | Reserve Per New Default | 4,178 | 4,315 | 3.17% | 4,328 | 4,418 | 2.04% | Other Operating Expenses | (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Direct Expenses | 19,874 | 17,157 | 15.84% | 36,441 | 34,427 | 5.85% | | Allocated Expenses | 42,328 | 43,197 | -2.01% | 77,451 | 77,706 | -0.33% | | Total Other Operating Expenses | 62,202 | 60,354 | 3.06% | 113,892 | 112,133 | 1.57% | | Expense Ratio | 29.7% | 28.5% | 1.2% | 27.3% | 26.8% | 0.5% | Results of Operations—All Other For the three months ended June 30, 2025, "All Other" businesses reported total revenue of $27.94 million, down 29.48% year-over-year, and an adjusted pre-tax operating loss of $16.36 million, widening by 169.09%; the revenue decline was primarily due to reduced net investment income and net gains/losses on investments and other financial instruments, while expenses decreased due to cost-cutting measures in certain businesses - "All Other" business performance may fluctuate due to market revaluation changes in mortgage asset values within the mortgage conduit business or seasonal variations in title and real estate services volumes[321] All Other Operating Results Summary | Metric (Thousands of USD) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | YoY Change Rate | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | YoY Change Rate | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Total Revenue | 27,943 | 39,722 | -29.48% | 63,881 | 74,128 | -13.82% | | Total Expenses | 44,304 | 45,802 | -3.27% | 83,701 | 87,241 | -4.06% | | Adjusted Pre-Tax Operating Income (Loss) | (16,361) | (6,080) | -169.09% | (19,820) | (13,113) | -51.15% | Liquidity and Capital Resources For the six months ended June 30, 2025, operating activities resulted in a $646 million cash outflow, investing activities generated $231 million in cash inflow, and financing activities generated $395 million in cash inflow; the holding company had $784 million in unrestricted cash and liquid investments, with total liquidity of $1.1 billion; as of June 30, 2025, the holding company's debt-to-capital ratio was 19.2%, and book value per share was $33.18; Radian Guaranty's PMIERs buffer was $2.0 billion, exceeding minimum required assets by 51% - As of June 30, 2025, Radian Group had $784 million in unrestricted cash and liquid investments, with total liquidity of $1.1 billion, including a $275 million unsecured revolving credit facility[329] - The holding company's primary liquidity needs for the next 12 months include corporate expenses, debt interest payments, quarterly dividend payments, and potential share repurchases[335] - As of June 30, 2025, Radian Guaranty's available assets under PMIERs were $6.0 billion, with a PMIERs buffer of $2.0 billion, exceeding minimum required assets by 51%[357] - Radian Guaranty paid a total of $400 million in dividends and capital returns to Radian Group in the first half of 2025[359] Consolidated Cash Flow Summary (Six Months) | Cash Flow Type (Thousands of USD) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | (645,529) | (156,238) | | Net Cash from Investing Activities | 231,310 | (74,433) | | Net Cash from Financing Activities | 394,942 | 226,390 | | Net Increase (Decrease) in Cash and Restricted Cash | (19,277) | (4,281) | Holding Company Capital Structure | (Thousands of USD, except per share amounts and ratios) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Debt | 1,066,603 | 1,065,337 | | Stockholders' Equity | 4,492,681 | 4,623,858 | | Total Capitalization | 5,559,284 | 5,689,195 | | Holding Company Debt-to-Capital