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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.