RADIAN GROUP INC (RDN)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The disclosures in this quarterly report are complementary to those made in our 2025 Form 10-K and should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto included in this report, as well as our audited financial statements, notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Form 10-K.

The following analysis of our financial condition and results of operations for the three and six months ended June 30, 2026, provides information that evaluates our financial condition as of June 30, 2026, compared with December 31, 2025, and our results of operations for the three and six months ended June 30, 2026, compared to the same periods in 2025.

Investors should review the “Cautionary Note Regarding Forward-Looking Statements—Safe Harbor Provisions” and “Item 1A. Risk Factors” herein and in our 2025 Form 10-K for a discussion of those risks and uncertainties that have the potential to adversely affect our business, financial condition, results of operations, cash flows or prospects. Our results of operations for interim periods are not necessarily indicative of results to be expected for the full year or for any other period. See “Overview” below and Note 1 of Notes to Unaudited Condensed Consolidated Financial Statements for additional information.

Overview

For nearly 50 years, we have been a leading private mortgage insurer, expanding access to affordable, responsible and sustainable homeownership. On February 2, 2026, we acquired Inigo, a Lloyd’s specialty insurer. The acquisition of Inigo expanded our business profile and established Radian as a global multi-line specialty insurer, combining the embedded value and capital generation capabilities of our mortgage insurance business with the growth potential of a disciplined specialty insurance and reinsurance business.

As part of our strategy to become a more focused insurance business we also announced a plan to divest our non-core businesses. We have now executed definitive actions to complete these divestitures, including completing the sale of our Real Estate Services business and entering into an agreement to sell our Title business. We expect the sale of our Title business to be completed by the end of this year.

Following the acquisition of Inigo, we now operate through two reportable segments, Mortgage and Specialty. We believe our businesses are differentiated by our proprietary risk analysis and risk management capabilities, which are informed by data and analytics, as well as our disciplined approach to underwriting and capital management. On a consolidated basis, during the second quarter of 2026, net income from continuing operations was $116 million, producing a 9.8% return on equity, while pretax income from continuing operations was $151 million. Adjusted pretax operating income was $196 million, resulting in a 12.9% adjusted net operating return on equity. The Specialty segment expanded our revenue base and further diversified our earnings streams, while our Mortgage segment continued to generate strong cash flow and capital. We believe the combination of our Mortgage and Specialty businesses has increased our strategic flexibility and is positioning Radian to deliver results over the long-term.

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Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Outlook

Looking ahead to the remainder of 2026, our priorities include continuing to deliver strong, consistent performance in our Mortgage segment, executing on the strategic development and selective growth of our Specialty segment and maintaining a disciplined approach to capital management. We believe our ability to consistently generate excess capital through cycles and redeploy it with discipline is a core competitive advantage. Our capital management philosophy prioritizes maintaining financial strength, investing in growth and responsibly returning excess capital to stockholders. Despite risks and uncertainties related to the current economic and market conditions, including premium rate softening in our Specialty segment, we continue to have a favorable outlook for our businesses based on the fundamentals in both our Mortgage and Specialty segments.

Legislative and Regulatory Developments

We are subject to comprehensive regulation and supervision in the jurisdictions in which our subsidiaries operate. For a description of significant U.S. state and federal regulations and other requirements of the GSEs that are applicable to our mortgage insurance business, as well as legislative and regulatory developments affecting the housing finance industry, see “Item 1. Business—Regulation—State Regulation” and “Item 1. Business—Regulation—Federal Regulation” in our 2025 Form 10-K. For a description of the U.K. regulatory requirements and framework and other requirements and regulations of Lloyd’s that are applicable to our specialty insurance business, see “Item 1. Business—Regulation—Regulation of Inigo” in our 2025 Form 10-K. There were no significant regulatory developments impacting our businesses from those discussed in our 2025 Form 10-K, other than the following.

Credit Score Models. In recent years, the FHFA and the GSEs have undertaken initiatives to modernize the credit scoring framework used in mortgage underwriting, including efforts to replace their use of Classic FICO credit scores with FICO 10T and VantageScore 4.0 credit scores. In April 2026, FHFA announced that the GSEs will accept loans with the VantageScore 4.0 model for certain approved lenders and will begin moving forward with FICO 10T. On July 29, 2026, the GSEs issued PMIERs guidance which sets forth the risk-based required asset factors for insured loans that utilize VantageScore 4.0 credit scores. This guidance is effective on September 30, 2026. We are working closely with lenders and other industry stakeholders on the adoption of VantageScore 4.0. We do not expect these updates to have a material impact on our business.

Basel III. Over the past several decades, the Basel Committee on Banking Supervision has established international benchmarks for assessing banks’ capital adequacy requirements (“Basel III”). While Basel III does not directly impact our mortgage insurance capital requirements, included within those benchmarks are capital standards related to residential lending and securitization activity and, importantly for private mortgage insurers, the capital treatment that banks will receive for mortgage insurance on those loans. In July 2023, the U.S. federal banking agencies published a notice of proposed rulemaking to implement the final components of Basel III that was heavily criticized and debated. In March 2026, the U.S. federal bank regulators released new proposals to update the regulatory capital framework for banks that include more granular risk weights for the capital treatment of residential real estate and maintain the existing treatment of mortgage insurance as a prudent underwriting standard. The proposals also include several questions on the treatment of mortgage insurance as part of the proposed risk weight calculations. The Company will continue to monitor developments with respect to this rulemaking and its potential impact on our mortgage insurance business.

Key Factors Affecting Our Results

Our condensed consolidated financial results for the six months ended June 30, 2026, reflect the continued performance of our Mortgage segment and the contribution of our Specialty segment, which includes the specialty insurance and reinsurance operations of Inigo, acquired on February 2, 2026. Except as set forth below, there have been no material changes to the key factors affecting our results discussed in our 2025 Form 10-K. In addition to those key factors, the following key factors have affected, and are expected to affect, our financial results.

Acquisition of Inigo and Specialty Insurance Operations. The acquisition of Inigo expanded our business mix through participation in global specialty insurance and reinsurance markets and provides diversification. Our financial results may continue to be affected by the execution of integration activities, the alignment of systems and controls and our ability to effectively manage underwriting, operational, regulatory and financial risks associated with these operations.

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Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The discussion below summarizes the key factors affecting the results for our Specialty segment.

Specialty Insurance and Reinsurance Market Conditions. Our Specialty segment operating results are influenced by market conditions across the specialty insurance and reinsurance classes and geographies in which we participate. These conditions include pricing levels, underwriting terms, available capacity among insurers within the specialty market and competitive dynamics, all of which are subject to cyclical trends and may vary by line of business. Changes in market conditions can affect premium volumes, expected loss ratios and underwriting profitability.

Premium Volume and Business Mix. Our Specialty segment results are affected by the volume, timing and mix of gross and net premiums written. Premium volumes may vary by period based on renewal activity, new business opportunities, pricing conditions, underwriting appetite, exposure levels and the availability and cost of reinsurance generally. Changes in business mix across insurance and reinsurance, or across lines of business with different risk, acquisition cost and earning patterns, may affect earned premiums, underwriting margins and comparability between periods.

Underwriting and Reserve Risk. Underwriting risk arises from the inherent uncertainty in the occurrence, timing and severity of insured events. Our Specialty segment underwriting results are affected by risk selection, pricing adequacy, exposure concentrations, policy terms and claims experience, including large losses and catastrophe events. Reserve estimates are inherently uncertain and depend on assumptions regarding claims development, severity, inflation and settlement patterns. Adverse changes in loss experience or assumptions may result in increased reserves, which could materially affect results in the period recognized.

Reinsurance and Risk Distribution. In our Specialty segment, we cede risk by purchasing reinsurance as a core risk management tool to limit our exposure to large individual losses, catastrophe events and aggregation risk, and to support capital efficiency. Our ceded reinsurance programs include excess of loss, quota share and catastrophe bond arrangements. The availability, cost and terms of ceded reinsurance are influenced by market conditions and loss experience, and changes to ceded reinsurance structures, retentions or counterparty performance may affect net results and earnings volatility.

Macroeconomic, Geopolitical and Catastrophe Risk. Our Specialty segment is exposed to macroeconomic conditions, geopolitical developments and natural catastrophe events, which may impact claims frequency and severity, underwriting demand and pricing, investment performance and capital requirements. Catastrophe losses can vary significantly between periods, and material events or adve

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report on Form 10-K. Certain terms and acronyms used throughout this report are defined in the Glossary of Abbreviations and Acronyms included as part of this report.

Some of the information in this discussion and analysis or included elsewhere in this report, including information with respect to our projections, plans and strategy for our business, are forward-looking statements that involve risks, uncertainties and assumptions. Our actual results and the timing of events could differ materially from those anticipated by these forward-looking statements as a result of many factors, including those discussed under “Cautionary Note Regarding Forward-Looking Statements—Safe Harbor Provisions” and in the Risk Factors detailed in Item 1A of this Annual Report on Form 10-K.

Overview

As a leading U.S. private mortgage insurer, Radian provides solutions that expand access to affordable, responsible and sustainable homeownership and helps borrowers achieve their dream of owning a home. As of December 31, 2025, we had one reportable business segment, Mortgage Insurance.

Our Mortgage Insurance segment aggregates, manages and distributes U.S. mortgage credit risk for the benefit of mortgage lending institutions and mortgage credit investors, principally through private mortgage insurance on residential first-lien mortgage loans.

In addition to our Mortgage Insurance segment, we previously reported in an All Other category activities consisting of: (i) income (losses) from assets held by Radian Group, our holding company; (ii) general corporate operating expenses not attributable or allocated to our reportable segment; and (iii) the results from certain other immaterial activities and operating segments, including our Mortgage Conduit, Title and Real Estate Services businesses. As further described in Notes 1 and 3 of Notes to Consolidated Financial Statements, in September 2025, following a comprehensive strategic review, Radian Group’s board of directors approved a plan to divest our Mortgage Conduit, Title and Real Estate Services businesses. As a result, we have reclassified the results related to these businesses to discontinued operations for all periods presented in our consolidated statements of operations.

Also in the third quarter of 2025, following the comprehensive strategic review, we announced that we had entered into a definitive agreement to acquire Inigo, a Lloyd’s specialty insurer, as part of the Company’s planned strategic transformation to a global multi-line specialty insurer. See Note 1 of Notes to Consolidated Financial Statements for additional information on this acquisition, which closed on February 2, 2026. We will begin to include Inigo’s results in our consolidated financial statements beginning in the first quarter of 2026.

Consistent with the trends observed in recent periods, the economic and market conditions impacting our results for the year ended 2025 remained generally favorable. These trends include: (i) a strong credit environment and housing market; (ii) higher Persistency in our Mortgage Insurance business due to low levels of mortgage refinancings, resulting from the interest rates of mortgages in our insured portfolio generally remaining below prevailing interest rates; and (iii) strong mortgage insurance fundamentals, including stringent underwriting and product standards, higher-quality borrowers with strong credit profiles and strengthened servicing standards and government support to help borrowers stay in their homes. We are monitoring trends in different credit asset classes, including recent reports of stress in certain asset classes, however the loans

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Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

in our portfolio and loans in the broader conventional mortgage segment continue to perform well. We continue to experience strong cure activity and low claims levels. See also “Key Factors Affecting Our Results,” below for additional discussion of the primary factors affecting the operating environment for our Mortgage Insurance business. Despite risks and uncertainties, including those set forth in “Item 1A. Risk Factors,” our outlook on the Mortgage Insurance business remains positive.

The following charts provide a perspective on mortgage origination volumes and private mortgage insurance penetration in recent periods.

Mortgage origination market (1)

Private mortgage insurance penetration of mortgage origination market (1)

(1)
Based on actual dollars generated in the credit enhanced market as reported by HUD and publicly reported industry information. Mortgage originations are based upon the average of originations reported by the Mortgage Bankers Association, Freddie Mac and Fannie Mae in their most recent published industry reports.

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Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Although it is difficult to project future volumes, recent industry projections indicate that total mortgage originations are expected to reach approximately $2.3 trillion in 2026, representing an increase of 15% compared to 2025.

Based on estimates of private mortgage insurance penetration, the private mortgage insurance market is projected to be moderately larger in 2026 relative to the estimated $300 billion market size in 2025. Homebuyer demand and a potential modest decline in interest rates would support a growing purchase market in 2026, which is expected to benefit mortgage insurers due to the higher propensity for purchased loans to require private mortgage insurance compared to refinanced loans. Additionally, an anticipated decrease in interest rates would be expected to result in increased refinance originations in 2026.

As we enter 2026, rate softening is occurring in several insurance and reinsurance lines in which our Specialty Insurance business participates, which is primarily attributable to excess capacity after a benign loss year in 2025. In the area of reinsurance, this can impact both premiums written for reinsurance coverage we write as well as the cost of coverage for reinsurance and retrocession coverage we obtain.

See Note 5 of Notes to Consolidated Financial Statements for additional information about our business. See “Key Factors Affecting Our Results” and “Mortgage Insurance Portfolio Metrics” below for additional discussion on specific key drivers that affect our performance.

Key Factors Affecting Our Results

The discussion below summarizes the key factors affecting our Mortgage Insurance business.

Mortgage Insurance

NIW

Our current business strategy for our Mortgage Insurance business is to write NIW that we believe will generate future earnings and economic value while effectively maintaining the portfolio’s health, balance and profitability. NIW increases our IIF and our premiums written and earned. NIW is affected by the overall size of the mortgage origination market, the penetration percentage of private mortgage insurance into the overall mortgage origination market and our market share of the private mortgage insurance market. Private mortgage insurance penetration has generally been higher on new mortgages for purchased homes than on the refinance of existing mortgages because average LTVs are typically higher on home purchases, and therefore, these lower down payment loans are more likely to require mortgage insurance. The penetration percentage of private mortgage insurance is mainly influenced by: (i) the competitiveness of private mortgage insurance for GSE conforming loans compared to FHA and VA insured loans and (ii) the relative percentage of mortgage originations that are for purchased homes versus refinancings.

IIF and Persistency

Our IIF is one of the primary drivers of our future premiums that we expect to earn over time. Although not reflected in the current period financial statements, nor in our reported book value, we expect our IIF to generate substantial earnings in future periods due to the high credit quality of our current mortgage insurance portfolio and our expectations for future Persistency Rates.

The ultimate profitability of our Mortgage Insurance business is affected by the impact of mortgage prepayment speeds on the mix of business we write. The measure for assessing the impact of policy cancellations on our IIF is our Persistency Rate, defined as the percentage of IIF that remains in force over a period of time. Assuming all other factors remain constant, over the life of the policies, prepayment speeds have an inverse impact on IIF and the expected revenue from our Monthly Premium Policies. Slower loan prepayment speeds, demonstrated by a higher Persistency Rate, result in more IIF remaining in place, providing increased revenue from Monthly Premium Policies over time as premium payments continue. Earlier than anticipated loan prepayments, demonstrated by a lower Persistency Rate, reduce IIF and the revenue from our Monthly Premium Policies. Among other factors, prepayment speeds may be affected by changes in interest rates and other macroeconomic factors. A rising interest rate environment generally will reduce refinancing activity and result in lower prepayments, whereas a declining interest rate environment generally will increase the level of refinancing activity and therefore increase prepayments.

In contrast to Monthly Premium Policies, when Single Premium Policies are canceled by the insured because the loan has been paid off or otherwise, we accelerate the recognition of any remaining unearned premiums, net of any refunds that

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Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

may be owed to the borrower. Although these cancellations reduce IIF, assuming all other factors remain constant, the profitability of our Single Premium business increases when Persistency Rates are lower.

Premiums

The premium rates we charge for our insurance are based on multiple borrower, loan and property characteristics. The mortgage insurance

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