Radian Agrees to Commute $827 Million Financial Guaranty Reinsurance Portfolio to FGIC

  Radian Agrees to Commute $827 Million Financial Guaranty Reinsurance
  Portfolio to FGIC

                  Reduces total reinsurance portfolio by 13%

Business Wire

PHILADELPHIA -- November 12, 2012

Radian Group Inc. today announced that on November 09, 2012, its financial
guaranty insurance subsidiary, Radian Asset Assurance Inc., entered into an
agreement (the “Agreement”) with Financial Guaranty Insurance Company (“FGIC”)
which, if consummated, would commute the remaining $827 million of outstanding
par reinsured by Radian Asset from FGIC (the “Commutation”). This portfolio
represents 13 percent of Radian Asset’s total reinsurance exposure as of
September 30, 2012, and includes $196 million of Radian Asset’s $225 million
in net par outstanding as of September 30, 2012, related to Jefferson County,
Alabama sewer warrants.

“Entering into this agreement is another example of our efforts to actively
reduce our financial guaranty exposure, which is an important component of our
capital management strategy,” stated Chief Executive Officer S.A. Ibrahim.

A rehabilitation proceeding for FGIC pursuant to Article 74 of the New York
Insurance Law is currently pending before the Supreme Court of the State of
New York (the “Court”), and the effectuation of the Commutation is subject to
approval by the Court of the Agreement and certain related matters. Such
approval is within the Court’s sole discretion, and no assurance can be given
that the Court will grant such approval or when it will be granted. If the
Court grants such approval, Radian Asset will be required to make a
commutation payment to FGIC in the approximate amount of $52.4 million once
that approval becomes final in accordance with the Agreement, and the
Commutation will become effective upon FGIC’s receipt of such payment. The
amount of this payment was determined primarily based on existing loss
reserves and unearned premium reserves, and therefore is not expected to have
a material impact on Radian’s consolidated financial statements or Radian
Asset’s statutory capital position.

About Radian

Radian Group Inc. (NYSE: RDN), headquartered in Philadelphia, provides private
mortgage insurance and related risk mitigation products and services to
mortgage lenders nationwide through its principal operating subsidiary, Radian
Guaranty Inc. These services help promote and preserve homeownership
opportunities for homebuyers, while protecting lenders from default-related
losses on residential first mortgages and facilitating the sale of
low-downpayment mortgages in the secondary market.

Forward-looking Statements

All statements in this press release that address events, developments or
results that we expect or anticipate may occur in the future are
“forward-looking statements” within the meaning of Section 27A of the
Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and
the United States (“U.S.”) Private Securities Litigation Reform Act of 1995.
In most cases, forward-looking statements may be identified by words such as
“anticipate,” “may,” “will,” “could,” “should,” “would,” “expect,” “intend,”
“plan,” “goal,” “contemplate,” “believe,” “estimate,” “predict,” “project,”
“potential,” “continue,” or the negative or other variations on these words
and other similar expressions. These statements, which may include, without
limitation, projections regarding our future performance and financial
condition, are made on the basis of management’s current views and assumptions
with respect to future events. Any forward-looking statement is not a
guarantee of future performance and actual results could differ materially
from those contained in the forward-looking information. The forward-looking
statements, as well as our prospects as a whole, are subject to risks and
uncertainties, including our ability to consummate the Commutation which
depends on, among other things, obtaining the Court’s approval of the
Agreement.

For more information regarding additional risks that we face, you should refer
to the Risk Factors detailed in Item 1A of Part I of our Annual Report on Form
10-K for the year ended December 31, 2011 and in Item 1A of Part II of our
Quarterly Reports on Form 10-Q filed during 2012, and in subsequent reports
and registration statements filed from time to time with the Securities and
Exchange Commission.

Contact:

Radian Group Inc.
Emily Riley,  215-231-1035
emily.riley@radian.biz
 
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