Radian Completes Commutation of $827 Million Reinsurance Portfolio to FGIC
Reduces total reinsurance portfolio by 13%
PHILADELPHIA -- January 14, 2013
Radian Group Inc. today announced that on January 9, 2013, its financial
guaranty insurance subsidiary, Radian Asset Assurance Inc., completed the
commutation of its remaining reinsurance risk from Financial Guaranty
Insurance Company (FGIC). As previously reported when the companies entered
into the agreement, the outstanding par reinsured by Radian Asset from FGIC
was $827 million as of September 30, 2012.
Radian Asset made the expected commutation payment of $52.4 million to FGIC
following approval of the transaction by the Supreme Court of the State of New
York. This payment primarily represents existing loss reserves and unearned
premium reserves for the portfolio, and therefore will not have a material
impact on Radian’s consolidated financial statements or Radian Asset’s
statutory capital position. The commuted portfolio represents 13 percent of
Radian Asset’s total reinsurance exposure as of September 30, 2012.
“We continue to make important strides in reducing Radian’s financial guaranty
exposure, including many of the riskiest segments of the portfolio,” stated
Chief Executive Officer S.A. Ibrahim. “We are pleased to successfully complete
this latest transaction, which reduces our total reinsurance portfolio by 13
percent and supports our company’s capital management strategy.”
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.
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. As a result, these
statements speak only as of the date they were made, and we undertake no
obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
For more information regarding risks and uncertainties 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.
Radian Group Inc.
Emily Riley, 215-231-1035
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