0000890926false00008909262024-11-062024-11-06
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 6, 2024
Radian Group Inc.
(Exact Name of Registrant as Specified in its Charter)
|
|
|
|
|
Delaware |
|
1-11356 |
|
23-2691170 |
(State or Other Jurisdiction of Incorporation) |
|
(Commission File Number) |
|
(IRS Employer Identification No.) |
550 East Swedesford Road, Suite 350
Wayne, Pennsylvania, 19087
(Address of Principal Executive Offices, and Zip Code)
(215) 231-1000
(Registrant’s Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
|
|
|
|
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
|
|
|
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
|
|
|
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
|
|
|
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
|
|
|
|
|
Title of each class |
|
Trading
Symbol(s) |
|
Name of each exchange on which registered |
Common Stock, $0.001 par value per share |
|
RDN |
|
New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐
Item 2.02. Results of Operations and Financial Condition.
On November 6, 2024, Radian Group Inc. (“Radian”) issued a news release announcing its financial results for the quarter ended September 30, 2024. A copy of this news release is furnished as Exhibit 99.1 to this report.
The information included in this Item 2.02 of, or furnished with, this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
* Furnished herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
|
|
|
|
|
|
|
|
|
|
|
RADIAN GROUP INC. |
|
|
|
|
|
|
(Registrant) |
|
|
|
|
Date: November 7, 2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
By: |
|
/s/ Sumita Pandit |
|
|
|
|
|
|
Sumita Pandit |
|
|
|
|
|
|
Chief Financial Officer |
|
|
|
press release |
|
November 6, 2024 |
Radian Announces Third Quarter 2024 Financial Results
— Third quarter net income of $152 million, or $0.99 per diluted share —
— Return on equity of 13.2% —
— Book value per share growth of 18% year-over-year to $31.37 —
— Returned $86 million of capital to stockholders through dividends and share repurchases —
— Holding company debt-to-capital ratio reduced to 18.5% following retirement of $450 million senior notes —
— $185 million ordinary dividend paid from Radian Guaranty to holding company during the third quarter —
— Available holding company liquidity of $844 million and PMIERs excess Available Assets of $2.1 billion —
WAYNE, PA. November 6, 2024 - Radian Group Inc. (NYSE: RDN) today reported net income for the quarter ended September 30, 2024, of $152 million, or $0.99 per diluted share. This compares with net income for the quarter ended September 30, 2023, of $157 million, or $0.98 per diluted share.
Adjusted pretax operating income for the quarter ended September 30, 2024, was $199 million, or $1.03 per diluted share. This compares with adjusted pretax operating income for the quarter ended September 30, 2023, of $210 million, or $1.04 per diluted share.
|
|
|
|
|
|
|
Key Financial Highlights |
|
Quarter ended |
($ in millions, except per-share amounts) |
|
September 30,
2024 |
|
June 30,
2024 |
|
September 30,
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenues |
|
$334 |
|
$321 |
|
$313 |
Net income |
|
$152 |
|
$152 |
|
$157 |
Diluted net income per share |
|
$0.99 |
|
$0.98 |
|
$0.98 |
Consolidated pretax income |
|
$195 |
|
$188 |
|
$201 |
Adjusted pretax operating income (1) |
|
$199 |
|
$193 |
|
$210 |
Adjusted diluted net operating income per share (1) (2) |
|
$1.03 |
|
$0.99 |
|
$1.04 |
Return on equity (3) |
|
13.2% |
|
13.6% |
|
15.0% |
Adjusted net operating return on equity (1) (2) |
|
13.7% |
|
13.6% |
|
16.0% |
New Insurance Written (NIW) - mortgage insurance |
|
$13,493 |
|
$13,902 |
|
$13,922 |
Net premiums earned - mortgage insurance |
|
$235 |
|
$235 |
|
$237 |
New defaults |
|
13,708 |
|
11,104 |
|
11,156 |
Provision for losses - mortgage insurance |
|
$6 |
|
$(2) |
|
$(8) |
|
|
|
|
|
|
|
|
|
As of |
($ in millions, except per-share amounts) |
|
September 30,
2024 |
|
June 30,
2024 |
|
September 30,
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Book value per share |
|
$31.37 |
|
$29.66 |
|
$26.69 |
Accumulated other comprehensive income (loss) value per share (4) |
|
$(1.56) |
|
$(2.50) |
|
$(3.35) |
PMIERs Available Assets (5) |
|
$5,984 |
|
$5,978 |
|
$5,758 |
PMIERs excess Available Assets (6) |
|
$2,122 |
|
$2,206 |
|
$1,670 |
Available holding company liquidity (7) |
|
$844 |
|
$1,190 |
|
$1,004 |
Total investments |
|
$6,497 |
|
$6,588 |
|
$5,886 |
Residential mortgage loans held for sale, at fair value (8) |
|
$530 |
|
$458 |
|
$138 |
Primary mortgage insurance in force |
|
$274,721 |
|
$272,827 |
|
$269,511 |
Percentage of primary loans in default (9) |
|
2.25% |
|
2.04% |
|
2.03% |
Mortgage insurance loss reserves |
|
$357 |
|
$351 |
|
$362 |
(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 federal 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 available liquidity after the repayment of our $450 million senior notes without considering available capacity under its undrawn $275 million unsecured revolving credit facility.
(8)Included in total investments on our condensed consolidated balance sheets.
(9)Represents the number of primary loans in default as a percentage of the total number of insured primary loans.
Book value per share at September 30, 2024, was $31.37, compared to $29.66 at June 30, 2024, and $26.69 at September 30, 2023. This represents an 18% growth in book value per share at September 30, 2024, as compared to September 30, 2023, and includes accumulated other comprehensive income (loss) of $(1.56) per share as of September 30, 2024, and $(3.35) per share as of September 30, 2023. 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 were pleased to deliver another quarter of excellent financial results for Radian, increasing book value per share by 18% year-over-year, generating net income of $152 million, and growing our primary mortgage insurance in force, which is the main driver of future earnings for our company, to $275 billion,” said Radian’s Chief Executive Officer Rick Thornberry. “These results reflect the economic value of our high-quality mortgage insurance portfolio, the strength and quality of our investment portfolio, our strong capital and liquidity positions, the depth of our customer relationships and the dedication of our team.”
THIRD QUARTER HIGHLIGHTS
■NIW was $13.5 billion in the third quarter of 2024, compared to $13.9 billion in the second quarter of 2024, and $13.9 billion in the third quarter of 2023.
■Purchase NIW decreased 3% in the third quarter of 2024 compared to the second quarter of 2024 and decreased 3% compared to the third quarter of 2023.
■Refinances accounted for 4% of total NIW in the third quarter of 2024, compared to 2% in the second quarter of 2024, and 1% in the third quarter of 2023.
■Total primary mortgage insurance in force of $274.7 billion as of September 30, 2024, compared to $272.8 billion as of June 30, 2024, and $269.5 billion as of September 30, 2023.
■Persistency, which is the percentage of mortgage insurance that remains in force after a twelve-month period, was 84% for the twelve months ended September 30, 2024, compared to 84% for the twelve months ended June 30, 2024, and 84% for the twelve months ended September 30, 2023.
■Annualized persistency for the three months ended September 30, 2024, was 84%, compared to 84% for the three months ended June 30, 2024, and 84% for the three months ended September 30, 2023.
■Net mortgage insurance premiums earned were $235 million for the third quarter of 2024, compared to $235 million for the second quarter of 2024, and $237 million for the third quarter of 2023.
■Mortgage insurance in force portfolio premium yield was 38.2 basis points in the third quarter of 2024. This compares to 38.2 basis points in the second quarter of 2024 and 38.0 basis points in the third quarter of 2023.
■Total net mortgage insurance premium yield, which includes the impact of ceded premiums earned and accrued profit commission, was 34.4 basis points in the third quarter of 2024. This compares to 34.5 basis points in the second quarter of 2024, and 35.3 basis points in the third quarter of 2023.
■Details regarding premiums earned may be found in Exhibit D.
■The mortgage insurance provision for losses was a provision of $6 million in the third quarter of 2024, compared to a benefit of $2 million in the second quarter of 2024 and a benefit of $8 million in the third quarter of 2023.
■Favorable reserve development on prior period defaults was $51 million in the third quarter of 2024, compared to $50 million in the second quarter of 2024 and $55 million in the third quarter of 2023.
■The number of primary delinquent loans was 22,350 as of September 30, 2024, compared to 20,276 as of June 30, 2024, and 20,406 as of September 30, 2023. This increase in delinquent loans is consistent with seasonal credit trends and the natural seasoning of the insured portfolio, and reflects the growth in the company’s total primary mortgage insurance in force in recent years.
■The loss ratio in the third quarter of 2024 was 3%, compared to (1)% in the second quarter of 2024, and (4)% in the third quarter of 2023.
■Total mortgage insurance claims paid were $3 million in the third quarter of 2024, compared to $6 million in the second quarter of 2024 and $5 million in the third quarter of 2023.
■Additional details regarding mortgage insurance provision for losses may be found in Exhibit D.
■During the third quarter of 2024, Radian Mortgage Capital closed its inaugural private-label prime jumbo mortgage securitization transaction of $349 million.
■Radian Group’s wholly owned subsidiary, Radian Investment Group Inc., retained certificates from the securitization with an initial fair value of $6 million and is considered to be the primary beneficiary of the securitization trust. As a result, Radian Group is consolidating the trust, which is a variable interest entity (“VIE”), in its financial statements. The consolidation of the VIE did not have a material impact on Radian Group’s results of operations in the third quarter of 2024.
■Additional details regarding the income statement and balance sheet impacts of the VIE can be found in Exhibit A and Exhibit C, respectively.
■Other operating expenses were $86 million in the third quarter of 2024, compared to $92 million in the second quarter of 2024, and $79 million in the third quarter of 2023.
■Other operating expenses decreased in the third quarter of 2024 as compared to the second quarter of 2024. The decrease in other operating expenses was partially offset by a $10 million impairment on internal-use software recognized in the third quarter of 2024.
■Additional details regarding other operating expenses may be found in Exhibit D.
CAPITAL AND LIQUIDITY UPDATE
Radian Group
■As previously announced, Radian Group completed the redemption of its 2024 senior notes in the amount of $450 million in the third quarter of 2024. This redemption resulted in a corresponding $450 million reduction in holding company debt and reduced the holding company debt-to-capital ratio to 18.5% as of September 30, 2024.
■As of September 30, 2024, Radian Group maintained $844 million of available liquidity. Total holding company liquidity, including the company’s undrawn $275 million unsecured revolving credit facility, was $1.1 billion as of September 30, 2024.
■During the third quarter of 2024, the company repurchased 1.5 million shares of Radian Group common stock at a total cost of $49 million. As of September 30, 2024, purchase authority of up to $618 million remained available under the existing program.
■Radian Group paid a dividend on its common stock in the amount of $0.245 per share, totaling $37 million, on September 11, 2024.
Radian Guaranty
■Radian Guaranty paid an ordinary dividend to Radian Group of $185 million in the third quarter of 2024, bringing total year-to-date ordinary dividends paid to $485 million.
■At September 30, 2024, Radian Guaranty’s Available Assets under PMIERs totaled $6.0 billion, resulting in PMIERs excess Available Assets of $2.1 billion.
CONFERENCE CALL
Radian will discuss third quarter 2024 financial results in a conference call tomorrow, Thursday, November 7, 2024, at 10:00 a.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 those investments and other financial instruments attributable to our Mortgage Conduit business; (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 (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, real estate, securitization, and title services. Powered by technology, informed by data and driven to deliver new and better ways to transact and manage risk, Radian is shaping the future of mortgage and real estate services. Learn more at www.radian.com.
Contact:
For Investors
Dan Kobell - Phone: 215.231.1113
email: daniel.kobell@radian.com
For Media
Rashi Iyer - Phone: 215.231.1167
email: rashi.iyer@radian.com
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: |
|
Condensed Consolidated Statements of Operations Detail |
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 (1)
Exhibit A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands, except per-share amounts) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net premiums earned |
|
$ |
239,133 |
|
|
$ |
237,731 |
|
|
$ |
235,857 |
|
|
$ |
232,649 |
|
|
$ |
240,262 |
|
Services revenue |
|
|
12,167 |
|
|
|
13,265 |
|
|
|
12,588 |
|
|
|
12,419 |
|
|
|
10,892 |
|
Net investment income |
|
|
78,396 |
|
|
|
73,766 |
|
|
|
69,221 |
|
|
|
68,824 |
|
|
|
67,805 |
|
Net gains (losses) on investments and other financial instruments |
|
|
2,174 |
|
|
|
(4,487 |
) |
|
|
490 |
|
|
|
13,447 |
|
|
|
(8,555 |
) |
Income (loss) on consolidated VIEs |
|
|
465 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other income |
|
|
1,522 |
|
|
|
872 |
|
|
|
1,262 |
|
|
|
1,305 |
|
|
|
2,109 |
|
Total revenues |
|
|
333,857 |
|
|
|
321,147 |
|
|
|
319,418 |
|
|
|
328,644 |
|
|
|
312,513 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for losses |
|
|
6,889 |
|
|
|
(1,745 |
) |
|
|
(7,034 |
) |
|
|
4,170 |
|
|
|
(8,135 |
) |
Policy acquisition costs |
|
|
6,724 |
|
|
|
6,522 |
|
|
|
6,794 |
|
|
|
6,147 |
|
|
|
6,920 |
|
Cost of services |
|
|
9,542 |
|
|
|
9,535 |
|
|
|
9,327 |
|
|
|
8,950 |
|
|
|
8,886 |
|
Other operating expenses |
|
|
85,919 |
|
|
|
91,648 |
|
|
|
82,636 |
|
|
|
95,218 |
|
|
|
79,206 |
|
Interest expense |
|
|
29,391 |
|
|
|
27,064 |
|
|
|
29,046 |
|
|
|
23,169 |
|
|
|
23,282 |
|
Impairment of goodwill |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
9,802 |
|
|
|
— |
|
Amortization of other acquired intangible assets |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,371 |
|
|
|
1,371 |
|
Total expenses |
|
|
138,465 |
|
|
|
133,024 |
|
|
|
120,769 |
|
|
|
148,827 |
|
|
|
111,530 |
|
Pretax income |
|
|
195,392 |
|
|
|
188,123 |
|
|
|
198,649 |
|
|
|
179,817 |
|
|
|
200,983 |
|
Income tax provision |
|
|
43,500 |
|
|
|
36,220 |
|
|
|
46,295 |
|
|
|
37,124 |
|
|
|
44,401 |
|
Net income |
|
$ |
151,892 |
|
|
$ |
151,903 |
|
|
$ |
152,354 |
|
|
$ |
142,693 |
|
|
$ |
156,582 |
|
Diluted net income per share |
|
$ |
0.99 |
|
|
$ |
0.98 |
|
|
$ |
0.98 |
|
|
$ |
0.91 |
|
|
$ |
0.98 |
|
(1)See Exhibit D for additional details.
Radian Group Inc. and Subsidiaries
Net Income Per Share
Exhibit B
The calculation of basic and diluted net income per share is as follows.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands, except per-share amounts) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income—basic and diluted |
|
$ |
151,892 |
|
|
$ |
151,903 |
|
|
$ |
152,354 |
|
|
$ |
142,693 |
|
|
$ |
156,582 |
|
Average common shares outstanding—basic |
|
|
151,846 |
|
|
|
153,110 |
|
|
|
153,817 |
|
|
|
155,318 |
|
|
|
158,461 |
|
Dilutive effect of share-based compensation arrangements (1) |
|
|
1,227 |
|
|
|
1,289 |
|
|
|
2,154 |
|
|
|
1,909 |
|
|
|
1,686 |
|
Adjusted average common shares outstanding—diluted |
|
|
153,073 |
|
|
|
154,399 |
|
|
|
155,971 |
|
|
|
157,227 |
|
|
|
160,147 |
|
Basic net income per share |
|
$ |
1.00 |
|
|
$ |
0.99 |
|
|
$ |
0.99 |
|
|
$ |
0.92 |
|
|
$ |
0.99 |
|
Diluted net income per share |
|
$ |
0.99 |
|
|
$ |
0.98 |
|
|
$ |
0.98 |
|
|
$ |
0.91 |
|
|
$ |
0.98 |
|
(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.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares of common stock equivalents |
|
|
— |
|
|
|
64 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Radian Group Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
Exhibit C
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sep 30, |
|
|
Jun 30, |
|
|
Mar 31, |
|
|
Dec 31, |
|
|
Sep 30, |
|
(In thousands, except per-share amounts) |
|
2024 |
|
|
2024 |
|
|
2024 |
|
|
2023 |
|
|
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments |
|
$ |
6,497,180 |
|
|
$ |
6,588,149 |
|
|
$ |
6,327,114 |
|
|
$ |
6,085,654 |
|
|
$ |
5,885,652 |
|
Cash |
|
|
28,061 |
|
|
|
13,791 |
|
|
|
26,993 |
|
|
|
18,999 |
|
|
|
55,489 |
|
Restricted cash |
|
|
2,014 |
|
|
|
1,993 |
|
|
|
1,832 |
|
|
|
1,066 |
|
|
|
1,305 |
|
Accrued investment income |
|
|
49,707 |
|
|
|
47,607 |
|
|
|
46,334 |
|
|
|
45,783 |
|
|
|
45,623 |
|
Accounts and notes receivable |
|
|
138,439 |
|
|
|
137,777 |
|
|
|
130,095 |
|
|
|
123,857 |
|
|
|
144,614 |
|
Reinsurance recoverable |
|
|
34,015 |
|
|
|
31,064 |
|
|
|
28,151 |
|
|
|
25,909 |
|
|
|
24,148 |
|
Deferred policy acquisition costs |
|
|
18,430 |
|
|
|
18,566 |
|
|
|
18,561 |
|
|
|
18,718 |
|
|
|
18,817 |
|
Property and equipment, net |
|
|
41,892 |
|
|
|
56,360 |
|
|
|
60,521 |
|
|
|
63,822 |
|
|
|
74,558 |
|
Goodwill and other acquired intangible assets, net |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
11,173 |
|
Prepaid federal income taxes |
|
|
870,336 |
|
|
|
837,736 |
|
|
|
750,320 |
|
|
|
750,320 |
|
|
|
696,820 |
|
Other assets |
|
|
384,666 |
|
|
|
396,600 |
|
|
|
369,944 |
|
|
|
459,805 |
|
|
|
420,483 |
|
Consolidated VIE assets (1) |
|
|
355,031 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total assets |
|
$ |
8,419,771 |
|
|
$ |
8,129,643 |
|
|
$ |
7,759,865 |
|
|
$ |
7,593,933 |
|
|
$ |
7,378,682 |
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unearned premiums |
|
$ |
198,007 |
|
|
$ |
206,094 |
|
|
$ |
215,124 |
|
|
$ |
225,396 |
|
|
$ |
236,400 |
|
Reserve for losses and loss adjustment expense |
|
|
363,225 |
|
|
|
357,470 |
|
|
|
361,833 |
|
|
|
370,148 |
|
|
|
367,568 |
|
Senior notes |
|
|
1,064,718 |
|
|
|
1,513,782 |
|
|
|
1,512,860 |
|
|
|
1,417,781 |
|
|
|
1,416,687 |
|
Secured borrowings |
|
|
551,916 |
|
|
|
484,665 |
|
|
|
207,601 |
|
|
|
119,476 |
|
|
|
241,753 |
|
Reinsurance funds withheld |
|
|
138,810 |
|
|
|
135,849 |
|
|
|
133,460 |
|
|
|
130,564 |
|
|
|
156,114 |
|
Net deferred tax liability |
|
|
737,605 |
|
|
|
656,113 |
|
|
|
626,353 |
|
|
|
589,564 |
|
|
|
497,560 |
|
Other liabilities |
|
|
318,345 |
|
|
|
293,351 |
|
|
|
262,902 |
|
|
|
343,199 |
|
|
|
309,701 |
|
Consolidated VIE liabilities (1) |
|
|
348,292 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total liabilities |
|
|
3,720,918 |
|
|
|
3,647,324 |
|
|
|
3,320,133 |
|
|
|
3,196,128 |
|
|
|
3,225,783 |
|
Common stock |
|
|
171 |
|
|
|
172 |
|
|
|
171 |
|
|
|
173 |
|
|
|
175 |
|
Treasury stock |
|
|
(967,717 |
) |
|
|
(967,218 |
) |
|
|
(946,202 |
) |
|
|
(945,870 |
) |
|
|
(945,504 |
) |
Additional paid-in capital |
|
|
1,315,046 |
|
|
|
1,356,341 |
|
|
|
1,390,436 |
|
|
|
1,430,594 |
|
|
|
1,482,712 |
|
Retained earnings |
|
|
4,584,453 |
|
|
|
4,470,335 |
|
|
|
4,357,823 |
|
|
|
4,243,759 |
|
|
|
4,136,598 |
|
Accumulated other comprehensive income (loss) |
|
|
(233,100 |
) |
|
|
(377,311 |
) |
|
|
(362,496 |
) |
|
|
(330,851 |
) |
|
|
(521,082 |
) |
Total stockholders’ equity |
|
|
4,698,853 |
|
|
|
4,482,319 |
|
|
|
4,439,732 |
|
|
|
4,397,805 |
|
|
|
4,152,899 |
|
Total liabilities and stockholders’ equity |
|
$ |
8,419,771 |
|
|
$ |
8,129,643 |
|
|
$ |
7,759,865 |
|
|
$ |
7,593,933 |
|
|
$ |
7,378,682 |
|
Shares outstanding |
|
|
149,776 |
|
|
|
151,148 |
|
|
|
151,509 |
|
|
|
153,179 |
|
|
|
155,582 |
|
Book value per share |
|
$ |
31.37 |
|
|
$ |
29.66 |
|
|
$ |
29.30 |
|
|
$ |
28.71 |
|
|
$ |
26.69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Holding company debt-to-capital ratio (2) |
|
|
18.5 |
% |
|
|
25.2 |
% |
|
|
25.4 |
% |
|
|
24.4 |
% |
|
|
25.4 |
% |
(1)Reflects the consolidation of Radian Mortgage Capital’s inaugural private label securitization, net of our retained interest in the transaction. We determined that we are the primary beneficiary of this securitization trust, which is considered to be a variable interest entity (“VIE”), thereby requiring us to consolidate the VIE.
(2)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
Condensed Consolidated Statements of Operations Detail
Exhibit D (page 1 of 3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Premiums Earned |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct - Mortgage insurance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Premiums earned, excluding revenue from cancellations |
|
$ |
261,726 |
|
|
$ |
259,342 |
|
|
$ |
258,593 |
|
|
$ |
256,632 |
|
|
$ |
254,903 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Single Premium Policy cancellations |
|
|
1,783 |
|
|
|
2,076 |
|
|
|
2,114 |
|
|
|
2,058 |
|
|
|
3,304 |
|
Total direct - Mortgage insurance |
|
|
263,509 |
|
|
|
261,418 |
|
|
|
260,707 |
|
|
|
258,690 |
|
|
|
258,207 |
|
Ceded - Mortgage insurance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Premiums earned, excluding revenue from cancellations |
|
|
(41,894 |
) |
|
|
(39,925 |
) |
|
|
(38,997 |
) |
|
|
(40,065 |
) |
|
|
(32,363 |
) |
Single Premium Policy cancellations (1) |
|
|
818 |
|
|
|
732 |
|
|
|
(112 |
) |
|
|
(444 |
) |
|
|
(873 |
) |
Profit commission - other (2) |
|
|
12,711 |
|
|
|
12,593 |
|
|
|
12,401 |
|
|
|
12,199 |
|
|
|
11,830 |
|
Total ceded premiums - Mortgage insurance |
|
|
(28,365 |
) |
|
|
(26,600 |
) |
|
|
(26,708 |
) |
|
|
(28,310 |
) |
|
|
(21,406 |
) |
Net premiums earned - Mortgage insurance |
|
|
235,144 |
|
|
|
234,818 |
|
|
|
233,999 |
|
|
|
230,380 |
|
|
|
236,801 |
|
Net premiums earned - Title insurance |
|
|
3,989 |
|
|
|
2,913 |
|
|
|
1,858 |
|
|
|
2,269 |
|
|
|
3,461 |
|
Net premiums earned |
|
$ |
239,133 |
|
|
$ |
237,731 |
|
|
$ |
235,857 |
|
|
$ |
232,649 |
|
|
$ |
240,262 |
|
(1)Includes the impact of related profit commissions.
(2)The amounts represent the profit commission under our QSR Program, excluding the impact of Single Premium Policy cancellations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services Revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage Insurance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract underwriting services |
|
$ |
244 |
|
|
$ |
309 |
|
|
$ |
210 |
|
|
$ |
202 |
|
|
$ |
266 |
|
All Other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate services |
|
|
7,876 |
|
|
|
8,777 |
|
|
|
9,193 |
|
|
|
8,888 |
|
|
|
7,046 |
|
Title |
|
|
3,427 |
|
|
|
3,540 |
|
|
|
2,573 |
|
|
|
2,713 |
|
|
|
2,964 |
|
Real estate technology |
|
|
620 |
|
|
|
639 |
|
|
|
612 |
|
|
|
616 |
|
|
|
616 |
|
Total services revenue |
|
$ |
12,167 |
|
|
$ |
13,265 |
|
|
$ |
12,588 |
|
|
$ |
12,419 |
|
|
$ |
10,892 |
|
Radian Group Inc. and Subsidiaries
Condensed Consolidated Statements of Operations Detail
Exhibit D (page 2 of 3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Investment Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed-maturities |
|
$ |
59,348 |
|
|
$ |
57,924 |
|
|
$ |
57,259 |
|
|
$ |
58,669 |
|
|
$ |
58,599 |
|
Equity securities |
|
|
3,047 |
|
|
|
3,067 |
|
|
|
2,539 |
|
|
|
3,753 |
|
|
|
3,222 |
|
Mortgage loans held for sale |
|
|
7,828 |
|
|
|
5,411 |
|
|
|
1,793 |
|
|
|
1,725 |
|
|
|
1,719 |
|
Short-term investments |
|
|
9,686 |
|
|
|
8,614 |
|
|
|
8,958 |
|
|
|
5,871 |
|
|
|
5,405 |
|
Other (1) |
|
|
(1,513 |
) |
|
|
(1,250 |
) |
|
|
(1,328 |
) |
|
|
(1,194 |
) |
|
|
(1,140 |
) |
Net investment income |
|
$ |
78,396 |
|
|
$ |
73,766 |
|
|
$ |
69,221 |
|
|
$ |
68,824 |
|
|
$ |
67,805 |
|
(1)Includes investment management expenses, as well as the net impact from our securities lending activities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for Losses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage insurance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current period defaults (1) |
|
$ |
57,032 |
|
|
$ |
47,918 |
|
|
$ |
53,688 |
|
|
$ |
53,981 |
|
|
$ |
46,630 |
|
Prior period defaults (2) |
|
|
(50,686 |
) |
|
|
(49,687 |
) |
|
|
(60,574 |
) |
|
|
(49,373 |
) |
|
|
(54,887 |
) |
Total Mortgage insurance |
|
|
6,346 |
|
|
|
(1,769 |
) |
|
|
(6,886 |
) |
|
|
4,608 |
|
|
|
(8,257 |
) |
Title insurance |
|
|
543 |
|
|
|
24 |
|
|
|
(148 |
) |
|
|
(438 |
) |
|
|
122 |
|
Total provision for losses |
|
$ |
6,889 |
|
|
$ |
(1,745 |
) |
|
$ |
(7,034 |
) |
|
$ |
4,170 |
|
|
$ |
(8,135 |
) |
(1)Related to defaulted loans with the most recent default notice dated in the period indicated. For example, if a loan had defaulted in a prior period, but then subsequently cured and later re-defaulted in the current period, the default would be considered a current period default.
(2)Related to defaulted loans with a default notice dated in a period earlier than the period indicated, which have been continuously in default since that time.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
(In thousands) |
|
Qtr 3 |
|
|
Qtr 2 |
|
|
Qtr 1 |
|
|
Qtr 4 |
|
|
Qtr 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and other base employee expenses |
|
$ |
32,851 |
|
|
$ |
41,431 |
|
|
$ |
39,723 |
|
|
$ |
34,182 |
|
|
$ |
33,272 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Variable and share-based incentive compensation |
|
|
17,581 |
|
|
|
23,223 |
|
|
|
17,515 |
|
|
|
20,262 |
|
|
|
19,546 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other general operating expenses (1) |
|
|
39,984 |
|
|
|
31,623 |
|
|
|
30,262 |
|
|
|
45,186 |
|
|
|
29,812 |
|
Ceding commissions |
|
|
(6,276 |
) |
|
|
(5,957 |
) |
|
|
(5,644 |
) |
|
|
(5,327 |
) |
|
|
(5,153 |
) |
Title agent commissions |
|
|
1,779 |
|
|
|
1,328 |
|
|
|
780 |
|
|
|
915 |
|
|
|
1,729 |
|
Total |
|
$ |
85,919 |
|
|
$ |
91,648 |