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Radian Group (RDN) Posts Wider 4Q Loss On Minimal Gains

 February 11, 2013 08:44 AM

(By Balaseshan) Radian Group Inc. (NYSE: RDN), a credit enhancement company, reported a wider quarterly loss due to minimal gains on investments and change in fair value of derivatives. Revenue dropped 38%, yet exceeded Street's expectations.

Loss for the fourth quarter widened to $177.30 million or $1.34 per share from $121.54 million or $0.92 per share last year.

The company said the latest quarter loss included minimal net gains on investments and combined net gains from the change in fair value of derivatives and other financial instruments as well as an income tax provision of $20.5 million.

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Total revenue decreased to $226.06 million from $364.55 million.

Analysts, on average, polled by Thomson Reuters had expected a loss of $0.50 per share on revenue of $200.03 million for the fourth quarter.

New mortgage insurance written (NIW) was $11.7 billion for the quarter, compared to $10.6 billion in the third quarter of 2012 and $6.5 billion in the prior-year quarter.

The mortgage insurance provision for losses was $306.9 million in the fourth quarter of 2012, compared to $171.8 million in the third quarter and $333.3 million in the prior-year period.

The total number of primary delinquent loans decreased by 2% in the fourth quarter from the third quarter of 2012, and by 16% from the fourth quarter of 2011.

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Total mortgage insurance claims paid were $263.4 million in the fourth quarter, compared to $272.4 million in the third quarter and $291.6 million in the fourth quarter of 2011.

Looking ahead, the company expects mortgage insurance net claims paid for the full-year 2013 of $900 million to $1.0 billion. The company anticipates paying dividend of about $35 million in 2013.

RDN closed Friday's regular session down 2.33% at $6.72. The stock has been trading between $2.00 and $7.15 for the past 52 weeks.

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