Radian Group Inc.'s private mortgage insurance subsidiary pulled back from certain pricing discounts that have driven competition in recent months in that business.
"While this decision has modestly impacted our market share, we have often been able to offset the impact with the addition of new customers and by increasing the amount of business we had received from existing customers," said CEO S.A. Ibrahim during the company's third-quarter conference call.
Radian Group reported a 47% year-over-year decline in net income in the third quarter to $70.1 million from $153.6 million in the
The mortgage insurance business reported pretax operating income of $115.9 million.
New insurance written was $11.2 billion, similar to the third quarter of 2014. "Notwithstanding competition this year, we are projecting that 2015 will be our second best year for primary flow NIW, writing in excess of $40 billion," Ibrahim said.
MGIC, which mentioned the competitive landscape in
The mortgage insurance provision for losses was $64.1 million in the third quarter, compared with $48.9 million in the prior-year period.
Radian Guaranty's loss ratio in the third quarter was 28.2% versus 22.5% in the third quarter of 2014.
Separately, NMI Holdings, the parent company of National MI, said the mortgage insurer did $3.6 billion in NIW for the third quarter up from $2.5 billion in
"Our growth in the quarter was driven by market share gains, reflecting continued growth from existing customers, as well as increasing contributions from new customers added this year," said Brad Shuster, chairman and CEO, during the company's conference call.
"Our results so far in October suggested our strong momentum is continuing in the fourth quarter. We have maintained a solid pace of new customer acquisition and activation, ending the quarter with 906 master policies, up from 842 in the prior quarter, and 391 customers generating NIW, up from 340 in the second quarter."
Shuster said during the call that the company has filed for higher rates for single-premium policies as of January 2016, the date the
"We're also testing a new rate structure for borrower-paid monthly policies that will provide a more consistent midteens' return across the full credit spectrum. This new rate structure balances prices across FICO scores. We believe this simplified approach is highly transparent which is a real asset in the post-TRID origination environment and is more responsive to borrowers because it eliminates some of the cross-subsidization that existed under the standard rate card," he said.
Shuster also said that NMI is exploring options available in the capital markets that would put the company in compliance with the secondary market capital requirements by the end of the year.
NMI lost $4.8 million in the quarter, which is an improvement over the $11 million loss posted in the third quarter of 2014.
