RDN Bucks MI Earnings Trend

Bucking the trend of losses being reported by its peers in the mortgage insurance industry, Radian Group Inc., Philadelphia, generated net income for the third quarter of $36.7 million ($0.46 per share). One year prior it lost $703.9 million ($8.82 per share). "Radian's third quarter results were impacted by a continuation of elevated mortgage insurance losses, which were offset by a reduction in our first-lien premium deficiency reserve," said S. A. Ibrahim, CEO of Radian. The company's profits came from the financial guaranty business. Its mortgage insurance business had a net loss for the quarter of $46.9 million, vs. net income of $74.4 million for the financial guaranty sector. Radian lowered its guidance on total claims paid for 2008 to $950 million. However, first-lien primary mortgage insurance defaults increased to 9.71% for the third quarter of 2008 vs. 5.87% in the third quarter of 2007. Total new mortgage insurance written was $7.5 billion, compared with $13.5 billion for the same period in 2007.