Mortgage insurer 4Q results bolstered by strong loan performance

Radian Group’s earnings grew to $193.4 million in the fourth quarter, up from $126.4 million in the third quarter and $148 million one year prior. Full year income was $600.7 million, up from $393.6 million.

But rumors about the company considering looking at possible suitors once again arose prior to the start of earnings season. In 2007, Radian agreed to merge with MGIC, but by September, with the financial crisis dragging down the housing market, the deal ended following some acrimony. On occasion since then, gossip has come into the market about Radian’s availability.

“We continue to think that consolidation among the six active MIs is unlikely given cannibalization risk,” KBW’s George said in a Feb. 7 note. “However, we acknowledge there could be interest from outside parties given depressed valuations.”

In response to a question from George during its earnings call, Radian CEO Rick Thornberry said the company does not comment on merger and acquisition rumors.

“We believe the market has a healthy number of players today,” Thornberry continued. “The GSEs have expressed the same and have an interest in not expanding their counterparty concentration risk, especially given their counterparty risk to private MI is their largest counterparty risk.”

Radian ended the quarter with NIW of $23.7 billion, down from $26.6 billion for the third quarter and $29.8 billion one year prior.

The company’s homegenius segment, which includes its title insurance underwriting subsidiary and other real estate services, reported revenues for the fourth quarter of $44.7 million, compared to $45.1 million for the third quarter, and $23.6 million for the fourth quarter of 2020.