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Jun 30, 2020
Radian Q2 2020 Earnings Report
Reported a net loss due to elevated loss provision in response to increased new defaults.
Key Takeaways
Radian Group Inc. reported a net loss of $30.0 million, or $0.15 per diluted share, for the quarter ended June 30, 2020, driven by an elevated loss provision due to an increase in new defaults which include defaults of loans subject to forbearance programs implemented in response to the COVID-19 pandemic. The company wrote a record volume of new primary mortgage insurance business of $25.5 billion dollars.
GAAP net loss of $30.0 million, or $0.15 per diluted share, driven by $304.4 million provision expense to increase reserves
New Insurance Written of $25.5 billion, setting company record for quarterly flow mortgage insurance
PMIERs Available Assets of $4.2 billion, or $1.0 billion (or 31% ) in excess of Minimum Required Assets
Total Holding Company Liquidity increases to $1.4 billion
Radian
Radian
Radian Revenue by Segment
Revenue by Segment
Mortgage Insurance Revenue
CapyFin.com Forward Guidance
This is a forward looking statement
Positive Outlook
- impact the size of the insurable market
- the credit performance of our insured portfolio
- our business prospects
- changes in the way customers, investors, ratings agencies, regulators or legislators perceive our performance, financial strength and future prospects
- Radian Guaranty Inc.’s (“Radian Guaranty”) ability to remain eligible under the Private Mortgage Insurer Eligibility Requirements (the “PMIERs”), including potential future changes to the PMIERs, and other applicable requirements imposed by the Federal Housing Finance Agency (the "FHFA") and by Fannie Mae and Freddie Mac (collectively, the “GSEs”) to insure loans purchased by the GSEs
Challenges Ahead
- the COVID-19 pandemic, which has significantly impacted the global economy, disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets, disrupted the housing finance system and real estate markets and increased unemployment levels
- the pandemic has resulted in travel restriction, stay-at-home, quarantine and similar orders, which have resulted in the closures of many businesses and, for those permitted to open, numerous operating limitations such as social distancing and other extensive health and safety measures
- the demand for certain of our products and services has been impacted, and this impact may continue for an unknown period and could expand in scope
- We expect that the COVID-19 pandemic and measures taken to reduce its spread will pervasively impact our business and subject us to certain risks
- difficult to estimate accurately, especially in the event of an extended economic downturn or a period of extreme market volatility and uncertainty such as we are currently experiencing due to the COVID-19 pandemic