Radian Group nearly doubled its net income during the second quarter from a year ago on a significant drop in expenses stemming from a smaller loss on debt extinguishment.
Radian's net income jumped 96% year-over-year to $98.1 million, the Philadelphia-based company said Thursday. Earnings per share of 44 cents beat the consensus estimate reported by Compass Point Research & Trading by six cents.
A 30% drop in total expenses to $173.6 million was mainly responsible for the earnings beat. Most of that decline stemmed from a smaller loss on induced conversion and debt extinguishment, which was just $2.1 million during the second quarter versus $91.9 million a year ago. That decrease was offset by a higher provision for losses, which rose to $49.7 million from $32.6 million last year.
Total revenue held steady at $330.2 million, as declines in net premiums earned on insurance and services revenue were offset by higher net investment income.
Radian also reported that new mortgage insurance written rose to $12.9 billion, 10% higher than a year ago. Refinances only accounted for 18% of the company's new insurance written, down from 23% last year. The company also only paid $90.7 million in total claims versus $212 million in the second quarter of 2015.
