RADIAN GROUP INC

Current report

The Company’s business, financial condition and results of operations are subject to various risks that could cause actual results to vary materially from recent results or from anticipated future results. Except as set forth below, there have been no material changes to our risk factors from those previously disclosed in our 2024 Form 10-K.

Current report

Risks Related to the Planned Inigo Acquisition

Current report

Closing of the Inigo acquisition is subject to certain conditions that may not be satisfied or waived, and the acquisition may not be completed, on the anticipated timeline or at all.

Current report

As previously disclosed, on September 18, 2025, Radian Group and Radian US entered into a share purchase deed (the “Inigo Purchase Agreement”) with the A Share Sellers (as defined therein), the B Share Management Sellers (as defined therein) and the Zedra Trust Company (Guernsey) Limited, a company incorporated in Guernsey, acting in its capacity as trustee of the employee benefit trust and nominee for each B Share Management Seller (together with the B Share Management Sellers and the A Share Sellers, the “Sellers”) pursuant to which Radian US has agreed to acquire all of the shares of Inigo for aggregate consideration of $1.7 billion (the “Purchase Price”), subject to certain adjustments described in the Inigo Purchase Agreement, including the ability of the Company to terminate the agreement if Inigo’s performance would result in the purchase price being adjusted below $1.65 billion.

Current report

The obligations of the parties to consummate the transaction are subject to the satisfaction of certain closing conditions, including that Radian US obtain the necessary regulatory approvals and the Sellers having delivered to Radian US a letter from the facility agent under a letter of credit facility agreement dated November 3, 2021, waiving the change of control clause under the letter of credit agreement.

Current report

The failure to satisfy the required conditions on a timely basis or at all, or a decline in Inigo’s performance warranting a material adjustment in the Purchase Price could delay the closing of the Inigo acquisition or result in termination of the Inigo Purchase Agreement. There can be no assurance that the closing conditions will be satisfied or waived or that the transaction will be completed. Any delay or failure to complete the Inigo acquisition could prevent us from realizing the anticipated benefits from the transaction and have a material adverse effect on our business strategy, financial condition and results of operations.

Current report

We face risks associated with our planned acquisition of Inigo and our ability to successfully execute our strategic transformation into a global multi-line specialty insurer.

Current report

The acquisition of Inigo is part of our planned strategic shift to transform the Company into a global multi-line specialty insurer and exposes us to certain risks that may negatively affect our financial condition and results of operations. These risks include: potential diversion of the attention of either party’s management from regular ongoing business operations; significant unknown or inestimable liabilities associated with Inigo; uncertainty about the expected future financial performance and results of Inigo and its businesses following completion of the acquisition; the possibility that we may be unable to realize the anticipated benefits of the transaction including the expected financial impact of the Inigo acquisition on us, capital efficiencies and benefits of scale and non-correlated diversification; our ability to comply with new regulatory requirements and manage international operations; and risks associated with the geographic expansion of our employee base, including any inability to maintain an effective Company culture and to attract, hire, and retain key and highly skilled personnel and to motivate them to perform.

Current report

Funding the Inigo acquisition will result in an immediate reduction in our liquidity and Radian Guaranty’s PMIERs cushion and will subject us to certain conditions and compliance obligations associated with the intercompany borrowing agreement between Radian Group and Radian Guaranty, which could adversely affect us and our financial condition.

Current report

Radian Group plans to pay a portion of the cash consideration for the Inigo acquisition with proceeds of a 10-year, $600 million intercompany borrowing from Radian Guaranty, which is planned to be entered into on or before the closing of the Inigo transaction. As a condition to receiving the Pennsylvania Insurance Department’s approval for the intercompany borrowing, the Company has agreed to provide certain enhanced reporting to the Pennsylvania Insurance Department while the intercompany borrowing is outstanding and to prepay the borrowing prior to maturity, in whole or in part, if Radian Guaranty needs additional liquidity to meet its policyholder obligations. Additionally, Radian Guaranty will be required to comply with certain conditions while the intercompany borrowing is outstanding, including, most notably, obtaining prior approval from the Pennsylvania Insurance Department for all dividends paid by Radian Guaranty for a period of at least three years and no more than five years, and maintaining a minimum policyholders’ surplus of $500 million. Absent other actions, we expect the intercompany borrowing to reduce Radian Guaranty’s PMIERs cushion by the principal amount of the note.

Current report

In addition to the proceeds from the intercompany borrowing, the Company plans to use cash or liquid investments on its balance sheet, and may also use borrowings under its revolving credit facility or obtain other sources of financing or use other available funding, to pay the remaining portion of the cash consideration for the Inigo acquisition, which will reduce the Company’s liquidity and available liquidity post-closing. Further, as discussed above, the conditions in place while the intercompany borrowing is outstanding could reduce or delay the payment of dividends from Radian Guaranty to Radian Group, which could further negatively impact Radian Group’s liquidity and financial flexibility.

Current report

Our use of cash and the intercompany borrowing to fund a portion of the purchase price of the Inigo acquisition and the resulting reduction in our liquidity and Radian Guaranty’s PMIERs cushion, may, among other things, limit our flexibility to pursue other business opportunities, increase our vulnerability to adverse economic and industry conditions, or negatively impact our credit ratings. We also may pursue financing transactions to raise capital, increase our liquidity and strengthen our financial position, which transactions may be unavailable to us on attractive terms or at all.

Current report

Risks Related to the Divestiture of our Mortgage Conduit, Title and Real Estate Services Businesses

Current report

We face risks associated with our decision to divest our Mortgage Conduit, Title and Real Estate Services businesses and we may fail to realize the anticipated benefits of these strategic divestitures.

Current report

We face risks associated with our decision to divest our Mortgage Conduit, Title and Real Estate Services businesses including: (i) the ability to complete any or all of the divestiture transactions, on the anticipated timeline or at all, including as a result of risks and uncertainties related to securing necessary regulatory and third-party approvals and consents; (ii) any impact of the decision to divest these businesses on our ability to attract, hire and retain key and highly skilled personnel; (iii) any disruption of current plans and operations caused by the decision to divest these businesses, making it more difficult to conduct business as usual or maintain relationships with current or future service providers, customers, employees, vendors and financing sources; (iv) exposure to unanticipated liabilities (including, among other things, those arising from representations and warranties made to a buyer regarding the businesses) or ongoing obligations to support the businesses following such divestitures; and (v) the terms, timing, structure, benefits and costs of any divestiture transaction for each of the businesses.

Current report

For these and other reasons there can be no assurance that we will be able to sell our Mortgage Conduit, Title and Real Estate Services businesses at a price and on terms that are acceptable to us, or at all. In addition, if the sale of any or all of these businesses cannot be completed, there can be no assurance that we will achieve an alternative exit strategy within the anticipated timeline, or at all. If we fail to complete the strategic divestitures, it could cause the potential diversion of management’s attention and have a material adverse effect on our financial condition and results of operations.