RADIAN GROUP INC

Previous wording

The following analysis of our financial condition and results of operations for the three months ended March 31, 2024, provides information that evaluates our financial condition as of March 31, 2024, compared with December 31, 2023, and our results of operations for the three months ended March 31, 2024, compared to the same period last year.

Current wording

The following analysis of our financial condition and results of operations for the three and six months ended June 30, 2024, provides information that evaluates our financial condition as of June 30, 2024, compared with December 31, 2023, and our results of operations for the three and six months ended June 30, 2024, compared to the same periods last year.

Previous wording

Consistent with the trends observed in recent periods, the economic and market conditions impacting our results for the first quarter of 2024 remained generally favorable. Interest rates remain elevated, which has benefited our Persistency Rates and net investment income yields, however, this has also contributed to reduced refinance volumes and NIW in our Mortgage Insurance business and lower transaction volumes for certain of our other businesses. Private mortgage insurance industry volumes are impacted by total mortgage origination volumes and the mix between mortgage originations that are for home purchases versus refinancings of existing mortgages. Although it is difficult to project future volumes, recent industry forecasts

Current wording

Consistent with the trends observed in recent periods, the economic and market conditions impacting our results for the first six months of 2024 remained generally favorable. Interest rates remain elevated, which has benefited our Persistency Rates and net investment income yields, however, this has also contributed to reduced refinance volumes and NIW in our Mortgage Insurance business and lower transaction volumes for certain of our other businesses. Private mortgage insurance industry volumes are impacted by total mortgage origination volumes and the mix between mortgage originations that are for home purchases versus refinancings of existing mortgages. Although it is difficult to project future volumes, recent industry

Previous wording

project a total mortgage origination market for 2024 of approximately $1.8 trillion, which would represent an increase of approximately 15% compared to 2023, but a reduction compared to projections at the beginning of 2024. This decrease in projections for 2024 primarily relates to the change in expectations for the timing for future interest rate decreases. Future interest rate decreases in 2024 are now expected to be less and to occur later, if at all, which would similarly delay any expected decline in mortgage interest rates, and as a result, reduce the overall size of the mortgage market. In light of updated projections, we now estimate that the private mortgage insurance market will be approximately $300 billion in 2024, which is the lower end of our expectations at the beginning of the year. In “Item 1A. Risk Factors” in our 2023 Form 10-K, see “A decrease in the volume of mortgage originations could result in fewer opportunities for us to write new mortgage insurance business and conduct our homegenius businesses” for more information.

Current wording

forecasts project a total mortgage origination market for 2024 of approximately $1.7 trillion, which would represent an increase of approximately 12% compared to 2023, but a reduction compared to projections at the beginning of 2024. This decrease in projections for 2024 primarily relates to the change in expectations for the timing for future interest rate decreases. Future interest rate decreases in 2024 are now expected to be less and to occur later, if at all, which would similarly delay any expected decline in mortgage interest rates, and as a result, reduce the overall size of the mortgage market. In light of updated projections, we now estimate that the private mortgage insurance market will be approximately $300 billion in 2024, which is the lower end of our expectations at the beginning of the year. In “Item 1A. Risk Factors” in our 2023 Form 10-K, see “A decrease in the volume of mortgage originations could result in fewer opportunities for us to write new mortgage insurance business and conduct our homegenius businesses” for more information.

Previous wording

We wrote $11.5 billion of primary new mortgage insurance in the three months ended March 31, 2024, compared to $11.3 billion of NIW in the three months ended March 31, 2023.

Current wording

We wrote $13.9 billion and $25.4 billion of primary new mortgage insurance in the three and six months ended June 30, 2024, respectively, compared to $16.9 billion and $28.2 billion of NIW in the three and six months ended June 30, 2023, respectively.

Previous wording

Our NIW increased by 2% for the three months ended March 31, 2024, compared to the same period in 2023, due to an increase in our market share, partially offset by a decline in private mortgage insurance penetration as a percentage of the overall mortgage origination market. According to industry estimates, total mortgage origination volume was slightly higher for the three months ended March 31, 2024, as compared to the comparable period in 2023, due to a small increase in both mortgage refinance activity and home purchases.

Current wording

Our NIW decreased by 18% and 10% for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023, due to a decline in private mortgage insurance penetration as a percentage of the overall mortgage origination market. According to industry estimates, total mortgage origination volume was relatively flat for the three months ended June 30, 2024 and was slightly higher for the six months ended June 30, 2024, both as compared to the comparable periods in 2023, due primarily to a small increase in mortgage refinance activity.

Previous wording

Our IIF is the primary driver of the future premiums that we expect to earn over time. IIF increased to $271.0 billion at March 31, 2024, from $270.0 billion at December 31, 2023, reflecting the impact of our NIW offset by policy cancellations and amortization for the first three months of 2024. Our IIF at March 31, 2024, increased 4% as compared to the same period last year, reflecting a 6% increase in Monthly Premium Policies in force partially offset by a 9% decline in Single Premium Policies in force.

Current wording

Our IIF is the primary driver of the future premiums that we expect to earn over time. IIF increased to $272.8 billion at June 30, 2024, from $270.0 billion at December 31, 2023, reflecting the impact of our NIW offset by policy cancellations and amortization for the first six months of 2024. Our IIF at June 30, 2024, increased 2% as compared to the same period last year.

Previous wording

Historically, there is a close correlation between interest rates and Persistency Rates. Higher interest rate environments generally decrease refinancings, which decrease the cancellation rate of our insurance and positively affect our Persistency Rates. As shown in the table below, our 12-month Persistency Rate at March 31, 2024, increased as compared to March 31, 2023. The increase in our Persistency Rate at March 31, 2024, was primarily attributable to decreased refinance activity due to increases in mortgage interest rates, as compared to the same period in the prior year. As of March 31, 2024, 85% of our IIF had a mortgage note interest rate of 6.5% or less. Given the increase in market mortgage interest rates, which, based on reported industry averages, now exceed these levels, we would expect a continued positive impact on our Persistency Rates. If refinance volume increases, we would expect the Persistency Rate for our portfolio to decrease, reducing the size of our IIF portfolio. See “If the length of time that our mortgage insurance policies remain in force declines, it could result in a decrease in our future revenues” under “Item 1A. Risk Factors” in our 2023 Form 10-K for more information.

Current wording

Historically, there is a close correlation between interest rates and Persistency Rates. Higher interest rate environments generally decrease refinancings, which decrease the cancellation rate of our insurance and positively affect our Persistency Rates. As shown in the table below, our 12-month Persistency Rate at June 30, 2024, increased as compared to June 30, 2023. The increase in our Persistency Rate at June 30, 2024, was primarily attributable to decreased refinance activity due to increases in mortgage interest rates, as compared to the same period in the prior year. As of June 30, 2024, 74% of our IIF had a mortgage note interest rate of 6.0% or less. Given the higher prevailing market mortgage interest rates, which, based on reported industry averages, now exceed these levels, we would expect a continued positive impact on our Persistency Rates. If refinance volume increases, we would expect the Persistency Rate for our portfolio to decrease, reducing the size of our IIF portfolio. See “If the length of time that our mortgage insurance policies remain in force declines, it could result in a decrease in our future revenues” under “Item 1A. Risk Factors” in our 2023 Form 10-K for more information.

Previous wording

Radian Group serves as the holding company for our operating subsidiaries and does not have any operations of its own. Our consolidated operating results for the three months ended March 31, 2024, and March 31, 2023, primarily reflect the financial results and performance of our Mortgage Insurance business. See “Results of Operations—Mortgage Insurance” for the operating results of this business segment for the three months ended March 31, 2024, compared to the same period in 2023.

Current wording

Radian Group serves as the holding company for our operating subsidiaries and does not have any operations of its own. Our consolidated operating results for the three and six months ended June 30, 2024, and June 30, 2023, primarily reflect the financial results and performance of our Mortgage Insurance business. See “Results of Operations—Mortgage Insurance” for the operating results of this business segment for the three and six months ended June 30, 2024, compared to the same periods in 2023.

Previous wording

Net Premiums Earned. Net premiums earned increased slightly for the three months ended March 31, 2024, as compared to the same period in 2023. See “Results of Operations—Mortgage Insurance—Revenues—Net Premiums Earned” for more information.

Current wording

Net Premiums Earned. Net premiums earned increased for the three and six months ended June 30, 2024, as compared to the same periods in 2023 primarily due to increased ceded premiums earned associated with the tender offers by Eagle Re 2019-1 Ltd. and Eagle Re 2020-1 Ltd. in the second quarter of 2023 to purchase the mortgage insurance-linked notes that supported their reinsurance agreements with Radian Guaranty. See “Results of Operations—Mortgage Insurance—Revenues—Net Premiums Earned” for more information.

Previous wording

Net Investment Income. The increase in net investment income for the three months ended March 31, 2024, as compared to the same period in 2023, is primarily attributable to higher market interest rates. See Note 6 of Notes to Unaudited Condensed Consolidated Financial Statements for comparative detail about net investment income. See “Results of Operations—Mortgage Insurance—Revenues—Net Investment Income” and “Results of Operations—All Other” for more information.

Current wording

Mortgage Capital and short-term investments. See Note 6 of Notes to Unaudited Condensed Consolidated Financial Statements for comparative detail about net investment income. See “Results of Operations—Mortgage Insurance—Revenues—Net Investment Income” and “Results of Operations—All Other” for more information.

Previous wording

Provision for Losses. The reduced benefit of the provision for losses for the three months ended March 31, 2024, as compared to the same period in 2023, is primarily driven by a reduction in favorable development on prior period defaults, which impacted our mortgage insurance reserves. See “Results of Operations—Mortgage Insurance—Expenses—Provision for Losses” for more information.

Current wording

Provision for Losses. The reduced benefit of the provision for losses for the three and six months ended June 30, 2024, as compared to the same periods in 2023, is primarily driven by a reduction in favorable development on prior period defaults, which impacted our mortgage insurance reserves. See “Results of Operations—Mortgage Insurance—Expenses—Provision for Losses” for more information.

Previous wording

Other Operating Expenses. Other operating expenses were slightly lower for the three months ended March 31, 2024, as compared to the same period in 2023. See “Results of Operations—Mortgage Insurance—Expenses—Other Operating Expenses” for more information.

Current wording

Other Operating Expenses. Other operating expenses increased for the three and six months ended June 30, 2024, as compared to the same periods in 2023. See “Results of Operations—Mortgage Insurance—Expenses—Other Operating Expenses” for more information.

Previous wording

Interest Expense. The increase in interest expense for the three months ended March 31, 2024, as compared to the same period in 2023, is primarily due to: (i) a $4 million loss on extinguishment of debt related to the redemption of the Senior Notes due 2025 in March 2024; (ii) the impact of the March 2024 issuance of the Senior Notes due 2029; and (iii) an increase in secured borrowings under our mortgage loan financing facilities. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for additional detail about our interest expense.

Current wording

Interest Expense. The increase in interest expense for the three and six months ended June 30, 2024, as compared to the same periods in 2023, is primarily due to: (i) an increase in secured borrowings under our mortgage loan financing facilities and (ii) the net impact of the March 2024 issuance and redemption of the Senior Notes due 2029 and Senior Notes due 2025, respectively. The six months ended June 30, 2024, was also impacted by a $4 million loss on extinguishment of debt related to the redemption of the Senior Notes due 2025 in March 2024. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for additional detail about our interest expense.

Previous wording

Our provision for income taxes for interim periods is established based on our estimated annual effective tax rate for a given year and reflects the impact of discrete tax effects in the period in which they occur. For the three months ended March 31, 2024 and 2023, state income taxes and certain permanent book-to-tax adjustments were the primary drivers of the difference in our effective tax rate compared to the federal statutory rate.

Current wording

Our provision for income taxes for interim periods is established based on our estimated annual effective tax rate for a given year and reflects the impact of discrete tax effects in the period in which they occur.

Previous wording

Adjusted pretax operating income (loss) is defined as GAAP consolidated pretax income (loss) excluding the effects of: (i) net gains (losses) on investments and other financial instruments, except for certain investments and other financial instruments attributable to our reportable segment or All Other activities; (ii) amortization and impairment of goodwill and other acquired intangible assets; and (iii) impairment of other long-lived assets and other non-operating items, if any, such as gains (losses) from the sale of lines of business, acquisition-related income (expenses) and gains (losses) on extinguishment of debt.

Current wording

Adjusted pretax operating income (loss) is defined as GAAP consolidated pretax income (loss) excluding the effects of: (i) net gains (losses) on investments and other financial instruments, except for certain investments and other financial instruments attributable to our reportable segment or All Other activities; (ii) amortization and impairment of goodwill and other acquired intangible assets; and (iii) impairment of other long-lived assets and other non-operating items, if any, such as gains

Previous wording

(2)The non-operating loss for the three months ended March 31, 2024, primarily relates to a loss on extinguishment of debt. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for more information.

Current wording

(2)The non-operating loss for the six months ended June 30, 2024, primarily relates to a loss on extinguishment of debt. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for more information.

Previous wording

Net Premiums Earned. Net premiums earned increased for the three months ended March 31, 2024, as compared to the same period in 2023, primarily due to an increase in direct premiums earned, due primarily to higher IIF, partially offset by a net increase in ceded premiums under our reinsurance programs.

Current wording

Net Premiums Earned. Net premiums earned increased for the three and six months ended June 30, 2024, as compared to the same periods in 2023, primarily due to increased ceded premiums earned associated with the tender offers by Eagle Re 2019-1 Ltd. and Eagle Re 2020-1 Ltd. in the second quarter of 2023 to purchase the mortgage insurance-linked notes that supported their reinsurance agreements with Radian Guaranty and, to a lesser extent, an increase in direct premiums earned in 2024, due primarily to higher IIF.

Previous wording

(1)Includes the impact of related profit commissions.

Current wording

(2)Includes the impact of related profit commissions.

Previous wording

(2)Represents the profit commission from the Single Premium QSR Program, 2022 QSR Agreement and 2023 QSR Agreement, excluding the impact of Single Premium Policy cancellations.

Current wording

(3)Represents the profit commission from the Single Premium QSR Program, 2022 QSR Agreement and 2023 QSR Agreement, excluding the impact of Single Premium Policy cancellations.

Previous wording

(3)Calculated by dividing annualized direct premiums earned, excluding revenue from cancellations, by average primary IIF.

Current wording

(4)Calculated by dividing annualized direct premiums earned, excluding revenue from cancellations, by average primary IIF.

Previous wording

(4)Calculated by dividing annualized direct premiums earned, by average primary IIF.

Current wording

(5)Calculated by dividing annualized direct premiums earned, by average primary IIF.

Previous wording

(5)Calculated by dividing annualized net premiums earned by average primary IIF. The calculation for all periods presented incorporates the impact of profit commission adjustments related to our reinsurance programs.

Current wording

(6)Calculated by dividing annualized net premiums earned by average primary IIF. The calculation for all periods presented incorporates the impact of profit commission adjustments related to our reinsurance programs.

Previous wording

(6)The average of beginning and ending balances of primary IIF, for each period presented.

Current wording

(7)The average of beginning and ending balances of primary IIF, for each period presented.

Previous wording

(1)Consists primarily of 2022 and 2023 QSR Agreements.

Current wording

(2)Consists primarily of 2022 and 2023 QSR Agreements.

Previous wording

(2)Does not include the benefit from ceding commissions from the reinsurance agreements in our QSR Program, which is primarily included in other operating expenses in our condensed consolidated statements of operations. See Note 8 of Notes to Unaudited Condensed Consolidated Financial Statements for additional information.

Current wording

(3)Does not include the benefit from ceding commissions from the reinsurance agreements in our QSR Program, which is primarily included in other operating expenses in our condensed consolidated statements of operations. See Note 8 of Notes to Unaudited Condensed Consolidated Financial Statements for additional information.

Previous wording

Net Investment Income. Higher investment balances and increasing yields from higher interest rates were the primary drivers of the increases in net investment income for the three months ended March 31, 2024, as compared to the same period in 2023.

Current wording

Net Investment Income. Higher investment balances and increasing yields from higher interest rates were the primary drivers of the increases in net investment income for the three and six months ended June 30, 2024, as compared to the same periods in 2023.

Previous wording

Current period new primary defaults increased by 11% for the three months ended March 31, 2024, compared to the same period in 2023, as shown below, which is consistent with the natural seasoning of the portfolio given the increase in our IIF in recent years. Our gross Default to Claim Rate assumption for new primary defaults was 8.0% at both March 31, 2024 and 2023, as we continue to closely monitor the trends in Cures and claims paid for our default inventory, while also weighing the risks and uncertainties associated with the current economic environment.

Current wording

Current period new primary defaults increased by 14% and 12% for the three and six months ended June 30, 2024, respectively, compared to the same periods in 2023, as shown below, which is consistent with the natural seasoning of the portfolio given the increase in our IIF in recent years. Our gross Default to Claim Rate assumption for new primary defaults was 8.0% at both June 30, 2024 and 2023, as we continue to closely monitor the trends in Cures and claims paid for our default inventory, while also weighing the risks and uncertainties associated with the current economic environment.

Previous wording

Our provision for losses during the three months ended March 31, 2024, and the same period in 2023, was positively impacted by favorable reserve development on prior period defaults, primarily as a result of more favorable trends in Cures than originally estimated. These Cures have been due primarily to favorable outcomes resulting from positive trends in home price appreciation, which has also contributed to a higher rate of claims that result in no ultimate loss and that are withdrawn by servicers as a result. These favorable observed trends resulted in reductions in our Default to Claim Rate and other reserve adjustments, including our Claim Severity assumptions as of March 31, 2024, for prior year default notices.

Current wording

Our provision for losses during the three and six months ended June 30, 2024, and the same periods in 2023, was positively impacted by favorable reserve development on prior period defaults, primarily as a result of more favorable trends in Cures than originally estimated. These Cures have been due primarily to favorable outcomes resulting from positive trends in home price appreciation, which has also contributed to a higher rate of claims that result in no ultimate loss and that are withdrawn by servicers as a result. These favorable observed trends resulted in reductions in our Default to Claim Rate and other reserve adjustments for prior year default notices.

Previous wording

Our primary default rate as a percentage of total insured loans at March 31, 2024, was 2.1% compared to 2.2% at December 31, 2023. The following table shows a rollforward of our primary loans in default.

Current wording

Our primary default rate as a percentage of total insured loans at June 30, 2024, was 2.0% compared to 2.2% at December 31, 2023. The following table shows a rollforward of our primary loans in default.

Previous wording

(2)Calculated excluding the impact of: (i) commutations and settlements; (ii) claims settled without payment; and (iii) claims that were submitted and subsequently withdrawn by the servicer.

Current wording

(3)Calculated excluding the impact of: (i) LAE; (ii) commutations and settlements; and (iii) claims resolved without payment, including claims subsequently withdrawn by the servicer.

Previous wording

Other Operating Expenses. The decrease in other operating expenses for the three months ended March 31, 2024, as compared to the same period in 2023, is primarily due to a reduction in general operating expenses related to expense savings actions implemented during the past year, as well as an increase in the benefit from ceding commissions under Radian Guaranty’s QSR Program.

Current wording

Other Operating Expenses. The increase in other operating expenses for the three and six months ended June 30, 2024, as compared to the same periods in 2023, is primarily due to an increase in variable and share-based compensation expense and severance related expense, partially offset by a reduction in general operating expenses related to expense savings actions implemented during the past year, as well as an increase in the benefit from ceding commissions under Radian Guaranty’s QSR Program. Share-based compensation expense for the three and six months ended June 30, 2024, includes $8 million of costs recognized on RSUs granted to retirement eligible grantees during the second quarter of 2024, as compared to $3 million for the same periods in 2023. Because no further service is required from retirement eligible grantees to satisfy vesting conditions for their awards, we recognize the full compensation costs as of the grant date for retirement eligible grantees. See Note 17 of Notes to Consolidated Financial Statements in our 2023 Form 10-K for additional information about our share-based compensation programs.

Previous wording

Operating Activities. Our most significant source of operating cash flows is from premiums received from our mortgage insurance policies, while our most significant uses of operating cash flows are typically for our operating expenses and claims paid on our mortgage insurance policies and taxes. In addition, our operating activities also include Radian Mortgage Capital’s purchases, sales and repayments of mortgage loans held for sale, which can fluctuate from period to period. The decrease in cash provided by operating activities for the three months ended March 31, 2024, as compared to the same period in 2023, is primarily due to increases in net purchases of mortgage loans held for sale in 2024, which increased by $99 million as compared to the same period last year.

Current wording

paid on our mortgage insurance policies and taxes. In addition, our operating activities also include Radian Mortgage Capital’s purchases, sales and repayments of mortgage loans held for sale, which can fluctuate from period to period. The increase in cash used in operating activities in the six months ended June 30, 2024, as compared to cash provided by operating activities in the same period in 2023, is primarily due to increases in net purchases of mortgage loans held for sale, which increased from $56 million in the first six months of 2023 to $428 million for the same period in 2024.

Previous wording

Investing Activities. Net cash used in investing activities increased for the three months ended March 31, 2024, as compared to the same period in 2023, primarily as a result of the increased cash provided by financing activities, as discussed below, resulting in more cash available to invest. This increase in available cash to invest was primarily deployed in the first quarter of 2024 for purchases, net of sales and redemptions, of short-term investments and fixed-maturities available for sale.

Current wording

Investing Activities. Net cash used in investing activities decreased slightly for the six months ended June 30, 2024, as compared to the same period in 2023. Cash used in investing activities was primarily from cash provided by operating activities other than net cash used for purchases of mortgage loans held for sale, which were primarily funded by financing activities as described below. Our cash used for investing for the six months ended June 30, 2024, included activities primarily for net purchases of short-term investments and fixed-maturities available for sale.

Previous wording

Financing Activities. For the three months ended March 31, 2024, our primary financing activities impacting cash included: (i) issuance and redemption of our senior notes and (ii) an increase in secured borrowings. These net increases were partially offset by: (i) payment of dividends and (ii) repurchases of our common stock. See Notes 12 and 14 of Notes to Unaudited Condensed Consolidated Financial Statements for additional information regarding our borrowings and share repurchases, respectively.

Current wording

Financing Activities. For the six months ended June 30, 2024, our primary financing activities impacting cash included: (i) an increase in secured borrowings, primarily related to funding from mortgage loan financing facilities, which increased from $47 million in the first six months of 2023 to $398 million for the same period in 2024, and (ii) the issuance and redemption of certain of our senior notes. These net increases were partially offset by: (i) repurchases of our common stock and (ii) payment of dividends. See Notes 12 and 14 of Notes to Unaudited Condensed Consolidated Financial Statements for additional information regarding our borrowings and share repurchases, respectively.

Previous wording

Radian Group serves as the holding company for our operating subsidiaries and does not have any operations of its own. At March 31, 2024, Radian Group had available, either directly or through unregulated subsidiaries, unrestricted cash and liquid investments of $1.1 billion. Available liquidity at March 31, 2024, excludes certain additional cash and liquid investments that have been advanced to Radian Group from our subsidiaries to pay for corporate expenses and interest payments. Total liquidity, which includes our undrawn $275 million unsecured revolving credit facility, as described below, was $1.4 billion as of March 31, 2024.

Current wording

Radian Group serves as the holding company for our operating subsidiaries and does not have any operations of its own. At June 30, 2024, Radian Group had available, either directly or through unregulated subsidiaries, unrestricted cash and liquid investments of $1.2 billion. Available liquidity at June 30, 2024, excludes certain additional cash and liquid investments that have been advanced to Radian Group from our subsidiaries to pay for corporate expenses and interest payments. Total liquidity, which includes our undrawn $275 million unsecured revolving credit facility, as described below, was $1.5 billion as of June 30, 2024.

Previous wording

During the three months ended March 31, 2024, Radian Group’s available liquidity increased by $102 million, due primarily to a $100 million ordinary dividend received from Radian Guaranty and the net impact of the issuance of the Senior Notes due 2029 and the redemption of the Senior Notes due 2025, partially offset primarily by payments for dividends and share repurchases, as described below.

Current wording

During the six months ended June 30, 2024, Radian Group’s available liquidity increased by $198 million, due primarily to $300 million in ordinary dividends received from Radian Guaranty and the net impact of the issuance of the Senior Notes due 2029 and the redemption of the Senior Notes due 2025, partially offset primarily by payments for dividends and share repurchases, as described below.

Previous wording

We expect Radian Group’s principal liquidity demands for the next 12 months to be: (i) the payment of corporate expenses, including taxes; (ii) the payment of $450 million principal amount of our outstanding Senior Notes due 2024; (iii) interest payments on our outstanding debt obligations; (iv) the payment of quarterly dividends on our common stock, which are currently $0.245 per share, and which remain subject to approval by our board of directors and our ongoing assessment of our financial condition and potential needs related to the execution and implementation of our business plans and strategies; (v) the potential continued repurchases of shares of our common stock pursuant to share repurchase authorizations, as described below; and (vi) investments to support our business strategy, including capital contributions to our subsidiaries.

Current wording

We expect Radian Group’s principal liquidity demands for the next 12 months to be: (i) the payment of $450 million principal amount of our outstanding Senior Notes due 2024; (ii) the payment of corporate expenses, including taxes; (iii) interest payments on our outstanding debt obligations; (iv) the payment of quarterly dividends on our common stock, which are currently $0.245 per share, and which remain subject to approval by our board of directors and our ongoing assessment of our financial condition and potential needs related to the execution and implementation of our business plans and strategies; (v) the potential continued repurchases of shares of our common stock pursuant to share repurchase authorizations, as described below; and (vi) investments to support our business strategy, including capital contributions to our subsidiaries.

Previous wording

Share Repurchases. During the three months ended March 31, 2024, the Company repurchased 1.8 million shares of Radian Group common stock under a program authorized by Radian Group’s board of directors, at a total cost of $50 million, including commissions. See Note 14 of Notes to Unaudited Condensed Consolidated Financial Statements for additional details on our share repurchase programs.

Current wording

Share Repurchases. During the six months ended June 30, 2024, the Company repurchased 3.3 million shares of Radian Group common stock under a program authorized by Radian Group’s board of directors, at a total cost of $100 million, including commissions. See Note 14 of Notes to Unaudited Condensed Consolidated Financial Statements for additional details on our share repurchase programs.

Previous wording

Dividends and Dividend Equivalents. In February 2024, Radian Group’s board of directors authorized an increase to the Company’s quarterly dividend from $0.225 to $0.245 per share. Based on our outstanding shares of common stock and restricted stock units, we expect to require approximately $148 million in the aggregate to pay dividends and dividend equivalents for the next 12 months. So long as no default or event of default exists under our revolving credit facility or the Parent Guarantees, Radian Group is not subject to any legal or contractual limitations on its ability to pay dividends except those generally applicable to corporations that are incorporated in Delaware. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for additional details. The declaration and payment of future quarterly dividends remains subject to the board of directors’ discretion and determination.

Current wording

Dividends and Dividend Equivalents. In February 2024, Radian Group’s board of directors authorized an increase to the Company’s quarterly dividend from $0.225 to $0.245 per share. Based on our outstanding shares of common stock, we expect to require approximately $148 million in the aggregate to pay dividends for the next 12 months, plus an incremental amount for dividend equivalents that will fluctuate based on final shares vested under our performance-based RSU programs. So long as no default or event of default exists under our revolving credit facility or the Parent Guarantees, Radian Group is not subject to any legal or contractual limitations on its ability to pay dividends except those generally applicable to corporations that are incorporated in Delaware. See Note 12 of Notes to Unaudited Condensed Consolidated Financial Statements for additional details. The declaration and payment of future quarterly dividends remains subject to the board of directors’ discretion and determination.

Previous wording

Corporate Expenses and Interest Expense. Radian Group has expense-sharing arrangements in place with its principal operating subsidiaries that require those subsidiaries to pay their allocated share of certain holding-company-level expenses, including interest payments on Radian Group’s outstanding debt obligations. Corporate expenses and interest expense on Radian Group’s debt obligations allocated under these arrangements during the three months ended March 31, 2024, of $38 million and $22 million, respectively, were substantially all reimbursed by its subsidiaries. We expect substantially all of our holding company expenses to continue to be reimbursed by our subsidiaries under our expense-sharing arrangements. The expense-sharing arrangements between Radian Group and its mortgage insurance subsidiaries, as amended, have been approved by the Pennsylvania Insurance Department, but such approval may be modified or revoked at any time.

Current wording

Corporate Expenses and Interest Expense. Radian Group has expense-sharing arrangements in place with its principal operating subsidiaries that require those subsidiaries to pay their allocated share of certain holding-company-level expenses, including interest payments on Radian Group’s outstanding debt obligations. Corporate expenses and interest expense on Radian Group’s debt obligations allocated under these arrangements during the six months ended June 30, 2024, of $86 million and $44 million, respectively, were substantially all reimbursed by its subsidiaries. We expect substantially all of our holding company expenses to continue to be reimbursed by our subsidiaries under our expense-sharing arrangements. The expense-sharing arrangements between Radian Group and its mortgage insurance subsidiaries, as amended, have been approved by the Pennsylvania Insurance Department, but such approval may be modified or revoked at any time.