This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Radian Group Management Discusses Q2 2012 Results - Earnings Call Transcript

Radian Guaranty's risk-to-capital ratio remains steady at 21:1 in the second quarter. The maintenance of our risk-to-capital ratio over time has been achieved by the many actions we have taken to manage our risk-to-capital position, including internal and external reinsurance, reductions in commutations of risk exposure and by realizing investment gains. We believe that Radian is positioned to continue writing new high-quality mortgage insurance business uninterrupted well into the future.

Now let me turn to the topics that we believe are top of mind. First, we continue to write more new mortgage insurance business with outstanding credit quality that can generate strong returns. In recent months, we have been capturing the largest share of new mortgage insurance business than ever before in our history in an exceptionally competitive but high-quality market. In the second quarter, we wrote $8.3 billion of new mortgage insurance business and wrote $14.8 million through the end of the second quarter.

We wrote 3x as much as new business as in the first half of 2012 as we did in the first half of last year, and the momentum continued in July with another $3.4 billion of new business written. The business written in the month of July alone is estimated to generate $20 million in after-tax value over its life after adjusting for reinsurance, and perhaps even more if the credit performance is better than expected, as has been the case with our most recent originations.

There's no denying that our sales and customer service teams have hussled [ph]. Their energy and enthusiasm help to set Radian apart as we continue to increase the amount of business we are writing. We have successfully retained our traditionally strong share of business from the nation's largest lenders while steadily increasing our business volume from credit unions, community banks and independent mortgage lenders. In fact, 18% of our NIW in 2012 came from customers new to Radian since last year, and nearly 40% from the approximately 1,100 customers, new to Radian since 2008. Importantly, as of the second quarter, the 2009 and -- through 2012 books grew to more than 35% of our primary risk in force and the most problematic 2006 and '07 books are now down to just under 30%. If the pace of our new business volume continues, we expect that, by mid-2013, our book of business written after 2008 will be larger than the book written in 2008 and prior. We view this shift as a positive factor that differentiates Radian and view it as one of the primary drivers of our expected return to operating profitability in 2013.

Read the rest of this transcript for free on seekingalpha.com

3 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,086.63 -26.91 -0.16%
S&P 500 1,987.01 +3.48 0.18%
NASDAQ 4,473.6970 +17.6810 0.40%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs