Radian (RDN) 8-K Radian Group, Inc.--form 8-K

EXHIBIT 99

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Radian Asset Assurance Inc.

Quarterly

Operating Supplement

Third Quarter 2003

Quarterly   Operating   Supplement Table of Contents

	Page
Company Profile	2
Company Information	2
Key Financial Highlights	3
Statutory Income Statements	4
Statutory Balance Sheets	5
Gross Premiums Written by Product	6
Total Claims-Paying Resources and Leverage Ratios	6
Investment Portfolio Highlights	7
Insured Portfolio Highlights	8
Management Team	12

1 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Table of Contents

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Quarterly Operating Supplement   September 30, 2003

Company Profile

Radian Asset Assurance Inc., founded in 1985 and rated AA by Standard & Poor’s and Fitch, provides credit enhancement to the holders of debt obligations and asset-backed securities. As a direct writer of financial guaranty insurance for municipal bonds, asset-backed securities and structured transactions, the company plays an important role in extending the benefits of insurance to a broad range of institutions and securities issuers.

Radian Asset Assurance Inc. is a subsidiary of Radian Group Inc., (NYSE: RDN), a global credit enhancement provider headquartered in Philadelphia, with significant operations in New York City and London.

Company Information

Radian Asset Assurance Inc.	Contact:
335 Madison Avenue	John C. DeLuca
New York, New York 10017	Senior Vice President, Market Development
1 877 337.4925 (within the U.S.)	1 212 984.9222
1 212 983.3100	john.deluca@radian.biz

2 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Company Profile / Company Information

Quarterly   Operating   Supplement Radian Group Inc. and Subsidiaries   Key Financial Highlights*($ Thousands)

	Nine months ended September 30, 2003
	Mortgage Insurance			Mortgage Services			Financial Guaranty			Total
Net premiums written	$	550,359		$	—		$	261,414		$	811,773
Net premiums earned	$	557,537		$	—		$	184,647		$	742,184
Net investment income		81,208			36			58,797			140,041
Equity in net income of affiliates		—			62,427			7,607			70,034
Other income		25,145			20,294			3,010			48,449
Total revenues		663,890			82,757			254,061			1,000,708
Provision for losses		212,278			—			51,782			264,060
Policy acquisition costs		53,297			—			42,875			96,172
Other operating expenses		96,442			28,166			27,821			152,429
Interest expense		16,065			2,346			9,477			27,888
Total expenses		378,082			30,512			131,955			540,549
Gain/(loss) on disposition of investments		1,371			(1,666	)		8,922			8,627
Change in fair value of derivative instruments		(606	)		35			(6,084	)		(6,655	)
Net gains/(losses)		765			(1,631	)		2,838			1,972
Pretax income		286,573			50,614			124,944			462,131
Income tax provision		77,614			20,247			33,846			131,707
Net income	$	208,959		$	30,367		$	91,098		$	330,424
Total assets	$	3,692,010		$	286,546		$	2,174,838		$	6,153,394
Deferred policy acquisition costs		76,844			—			135,234			212,078
Reserve for losses		499,583			—			169,463			669,046
Unearned premiums		104,064			—			580,867			684,931
Equity	$	1,760,328		$	234,106		$	1,128,447		$	3,122,881

* Reported on a GAAP basis.

3 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Key Financial Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Statutory Income Statements($ Thousands)

	Quarter ended						Nine months ended
	September 30 2003			September 30 2002			September 30 2003			September 30 2002
Revenues
Gross premiums written	$	54,119		$	51,469		$	115,186		$	145,482
Reinsurance premiums ceded		(6,759	)		(3,601	)		(20,122	)		(22,306	)
Net premiums written		47,360			47,868			95,064			123,176
Increase in unearned premiums		(25,268	)		(25,142	)		(18,463	)		(57,300	)
Premiums earned		22,092			22,726			76,601			65,876
Net investment income		7,899			6,175			22,155			18,787
Net realized gain on sale of investments		1,231			1,169			2,649			694
Net investment gains		9,130			7,344			24,804			19,481
Other (expense) income		(1,023	)		141			177			474
Total revenues		30,199			30,211			101,582			85,831
Expenses
Losses and loss adjustment expenses incurred		2,390			5,971			12,670			24,959
Commissions incurred		(806	)		3,824			(6,414	)		8,427
Other underwriting expenses		11,845			9,660			34,743			25,815
Total expenses		13,429			19,455			40,999			59,201
Income before income taxes		16,770			10,756			60,583			26,630
Federal and foreign income taxes		2,099			4,023			5,534			6,749
Net income	$	14,671		$	6,733		$	55,049		$	19,881
Financial Ratios
Loss and LAE Ratio		10.8	%		26.3	%		16.5	%		37.9	%
Underwriting Expense Ratio		23.3	%		28.2	%		29.8	%		27.8	%
Combined Ratio		34.1	%		54.5	%		46.3	%		65.7	%

Effective April 30, 2003, Radian Asset Assurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Reinsurance Inc.) whereby the Company reversed assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

4 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Statutory Income Statements

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Statutory Balance Sheets($ Thousands)

	September 30 2003		December 31 2002
Assets
Long-term bonds	$	661,643	$	550,512
Preferred stock		37,476		24,585
Common stock		42,468		1,156
Cash and short-term investments		42,641		46,100
Receivable for securities		38		149
Total Investments		784,266		622,502
Investment income due and accrued		8,047		6,919
Premiums receivable		17,660		22,449
Funds held by reinsured companies		86		1,863
Current federal income tax recoverable		596		—
Net deferred tax asset		952		1,531
Other assets		—		2,119
Total Assets	$	811,607	$	657,383
Liabilities
Contingency reserve	$	53,857	$	39,272
Losses and loss adjustment expenses		16,538		50,453
Reinsurance payable on paid losses and loss adjustment expenses		1,338		4,843
Unearned premiums		252,164		233,701
Provision for reinsurance		173		284
Payable to affiliates		3,897		2,200
Payable for securities		1,958		6,660
Ceded reinsurance premiums payable		2,474		2,670
Federal and foreign income taxes payable		1,708		5,360
Funds held under reinsurance treaties		22,976		—
Accrued expenses and other liabilities		3,058		2,481
Total Liabilities		360,141		347,924
Policyholders’ Surplus
Common stock		15,000		15,000
Additional paid-in capital		326,714		229,077
Unassigned funds		109,752		65,382
Total Policyholders’ Surplus		451,466		309,459
Total Liabilities and Policyholders’ Surplus	$	811,607	$	657,383
Qualified Statutory Capital	$	505,323	$	348,731

Effective April 30, 2003, Radian Asset Assurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Reinsurance Inc.) whereby the Company reversed assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

5 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Statutory Balance Sheets

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Gross Premiums Written by Product($ Thousands)

	3rd Qtr 2003		3rd Qtr 2002		% Change		YTD 2003			YTD 2002		% Change
Public Finance Direct	$	21,543	$	13,314	61.8	%	$	43,280		$	43,855	–1.3	%
Structured Finance Direct		29,880		23,618	26.5	%		68,524			55,501	23.5	%
Public Finance Reinsurance		419		1,855	–77.4	%		4,750			2,468	92.5	%
Structured Finance Reinsurance		2,277		3,658	–37.8	%		8,325			16,233	–48.7	%
Trade Credit Reinsurance		—		9,024	–100.0	%		(9,693	)		27,425	–135.3	%
	$	54,119	$	51,469	5.1	%	$	115,186		$	145,482	–20.8	%

Effective April 30, 2003, Radian Asset Assurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Reinsurance Inc.) whereby the Company reversed assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

Total Claims-Paying Resources and Leverage Ratios

($ Thousands except ratios)

	September 30 2003		December 31 2002		% Change
Capital and Surplus	$	451,466	$	309,459	46	%
Contingency Reserve		53,857		39,272	37	%
Qualified Statutory Capital		505,323		348,731	45	%
Unearned Premium Reserve		252,164		233,701	8	%
Loss and Loss Expense Reserves		16,538		50,453	–67	%
Total Policyholders’ Reserves		774,025		632,885	22	%
Present Value of Future Installment Premiums		172,088		151,032	14	%
Reinsurance and Soft Capital Facilities		200,000		15,000	1,233	%
Total Claims-Paying Resources	$	1,146,113	$	798,917	43	%
Total Debt Service (Principal and Interest) Outstanding	$	26,102,930	$	22,081,339	18	%
Capital Leverage Ratio1		52:1		63:1
Claims-Paying Ratio2		23:1		28:1

1 Capital Leverage Ratio: Total debt service/Qualified statutory capital.

2 Claims-Paying Ratio: Total debt service/Total claims-paying resources.

6 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Gross Premiums / Total Claims-Paying Resources

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Investment Portfolio Highlights

Asset Quality

As of September 30, 2003, the book value of our investment portfolio was $762.7 million, with an average duration of 4.9 years.

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Asset Class

Our conservative portfolio is invested primarily in fixed-income securities. Our primary objective is to achieve total return, with a secondary objective of maximizing after-tax income.

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7 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Investment Portfolio Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Insured Portfolio Highlights($ Thousands)   Geographic Diversification

State	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
New York	$	1,174,701	6.2	%	$	1,019,026	6.7	%
Pennsylvania		1,145,231	6.1	%		993,019	6.5	%
Texas		1,017,060	5.4	%		1,133,571	7.4	%
Florida		666,700	3.5	%		649,067	4.3	%
California		469,228	2.5	%		494,536	3.2	%
Connecticut		452,472	2.4	%		463,912	3.0	%
Colorado		452,039	2.4	%		371,126	2.4	%
Illinois		411,498	2.2	%		362,451	2.4	%
Washington		319,373	1.7	%		323,379	2.1	%
Massachusetts		289,506	1.5	%		266,640	1.8	%
Total of top ten states		6,397,808	33.9	%		6,076,727	39.8	%
Total of other states		3,849,234	20.4	%		3,297,970	21.6	%
Domestic structured finance		8,143,619	43.2	%		5,282,486	34.6	%
International		470,379	2.5	%		608,706	4.0	%
Total	$	18,861,040	100.0	%	$	15,265,889	100.0	%

8 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Insured Portfolio Highlights($ Thousands)   Sector Breakout

Public Finance	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
Healthcare	$	2,455,632	13.1	%	$	1,997,820	13.1	%
General Obligations		2,036,413	10.8	%		2,105,718	13.7	%
Education		1,723,631	9.1	%		1,549,056	10.1	%
Long-Term Care		976,428	5.2	%		840,073	5.5	%
Utilities		844,019	4.5	%		827,500	5.4	%
Other Public Finance		672,560	3.6	%		468,386	3.1	%
Tax-Backed		507,777	2.7	%		497,104	3.3	%
AAA Wrap Municipal		440,030	2.3	%		442,891	2.9	%
Transportation		403,647	2.1	%		408,275	2.7	%
Housing		192,954	1.0	%		208,523	1.4	%
Investor-Owned Utilities		55,902	0.3	%		59,856	0.4	%
Subtotal Public Finance	$	10,308,993	54.7	%	$	9,405,202	61.6	%
Structured Finance	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
Collateralized Debt Obligations	$	6,372,069	33.8	%	$	4,227,312	27.6	%
Asset-Backed – Mortgage and MBS		858,883	4.6	%		192,886	1.3	%
Asset-Backed – Consumer		724,127	3.8	%		649,398	4.3	%
Asset-Backed – Commercial and Other		344,492	1.8	%		490,718	3.2	%
Other Structured Finance		252,476	1.3	%		300,373	2.0	%
Subtotal Structured Finance	$	8,552,047	45.3	%	$	5,860,687	38.4	%
Total	$	18,861,040	100.0	%	$	15,265,889	100.0	%

9 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Insured Portfolio Highlights ($ Thousands)   Rating Distribution

Rating*	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
AAA	$	5,008,139	26.6	%	$	2,434,386	16.0	%
AA		2,901,939	15.4	%		2,903,551	19.0	%
A		3,191,562	16.9	%		2,638,433	17.3	%
BBB		6,588,419	34.9	%		5,682,251	37.2	%
Investment Grade		332,287	1.8	%		198,467	1.3	%
Below Investment Grade		508,663	2.7	%		719,055	4.7	%
Not Rated		330,031	1.7	%		689,746	4.5	%
Total	$	18,861,040	100.0	%	$	15,265,889	100.0	%

* Indicated category reflects highest rating of the three rating agencies.

10 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Insured Portfolio Highlights($ Thousands)   10 Largest Public Finance Exposures

	Net Par (9/30/2003)		Percent of total Net Par		Rating*
MUNI Leveraged Lease	$	145,377	0.76	%	A
Port Authority New York & New Jersey		92,487	0.49	%	AA–
Second-To-Pay MUNI Wrap		90,000	0.48	%	AAA
Second-To-Pay MUNI Wrap		90,000	0.48	%	AAA
Second-To-Pay MUNI Wrap		88,000	0.47	%	AAA
Interlocken Consolidated Metropolitan District		85,095	0.45	%	BBB–
Long Island Univ – New York St Dorm Auth		81,393	0.43	%	BBB–
Orlando Regional Health Systems Florida		78,558	0.42	%	A
New York, New York GO		78,460	0.42	%	A
MUNI Leveraged Lease		76,976	0.41	%	AA
Total top ten	$	906,346	4.81	%

10 Largest Structured Finance Exposures

	Net Par (9/30/2003)		Percent of total Net Par		Rating*
European Static Synthetic CDO	$	270,900	1.43	%	AAA
U.S. Static Synthetic CDO		270,000	1.43	%	AAA
U.S. Static Synthetic CDO		270,000	1.43	%	AAA
CDO of ABS		270,000	1.43	%	AAA
U.S. Static Synthetic CDO		270,000	1.43	%	AA
CDO of ABS		257,529	1.36	%	AA
U.S. Static Synthetic CDO		252,050	1.34	%	AA
U.S. Static Synthetic CDO		250,000	1.33	%	AA+
U.S. Static Synthetic CDO		250,000	1.33	%	AAA
U.S. Static Synthetic CDO		250,000	1.33	%	AAA
Total top ten	$	2,610,479	13.84	%

* Indicated category reflects highest rating of the three rating agencies.

11 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Asset Assurance Inc.   Management Team

Martin A. Kamarck

President

David J. Beidler

Senior Vice President, Chief Legal Officer

Edward McC. Bowers

Senior Vice President, Global Structured Products

Sally B. Campbell

Senior Vice President, Public Finance

John C. DeLuca

Senior Vice President, Market Development

Bonita Z. Dorland

Senior Vice President, Chief Risk Officer

Andrew C.J. Poole

Managing Director, Radian Representatives Ltd.

Jack Praschnik

Senior Vice President, Global Strategies

Patrick Rossi

Senior Vice President, Controller

Jeffrey C. Salton

Senior Vice President, Operations and Analysis

12 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Radian Asset Assurance Inc. Management Team

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Radian Reinsurance Inc.

Quarterly

Operating Supplement

Third Quarter 2003

Quarterly   Operating   Supplement Table of Contents  

	Page
Company Profile	2
Company Information	2
Key Financial Highlights	3
Statutory Income Statements	4
Statutory Balance Sheets	5
Gross Premiums Written by Product	6
Total Claims-Paying Resources and Leverage Ratios	6
Investment Portfolio Highlights	7
Insured Portfolio Highlights	8
Management Team	12

1 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Table of Contents

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Quarterly Operating Supplement   September 30, 2003

Company Profile

Radian Reinsurance Inc., founded in 1986 and rated AA by Fitch Ratings and Standard & Poor’s and Aa2 by Moody’s, was the first company dedicated exclusively to the reinsurance of investment-grade securities. The company is a leading provider of treaty and facultative reinsurance for primary insurers of municipal bonds, asset-backed obligations and structured finance obligations, helping insurers manage portfolio risk exposure; increase insurance capacity; and meet regulatory and rating-agency capital requirements.

Radian Reinsurance Inc. is a subsidiary of Radian Group Inc., (NYSE: RDN), a global credit enhancement provider headquartered in Philadelphia, with significant operations in New York City and London.

Company Information

Radian Reinsurance Inc.	Contact:
335 Madison Avenue	John C. DeLuca
New York, New York 10017	Senior Vice President, Market Development
1 877 337.4925 (within the U.S.)	1 212 984.9222
1 212 983.3100	john.deluca@radian.biz

2 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Company Profile / Company Information

Quarterly   Operating   Supplement Radian Group Inc. and Subsidiaries   Key Financial Highlights*($ Thousands)

	Nine months ended September 30, 2003
	Mortgage Insurance			Mortgage Services			Financial Guaranty			Total
Net premiums written	$	550,359		$	—		$	261,414		$	811,773
Net premiums earned	$	557,537		$	—		$	184,647		$	742,184
Net investment income		81,208			36			58,797			140,041
Equity in net income of affiliates		—			62,427			7,607			70,034
Other income		25,145			20,294			3,010			48,449
Total revenues		663,890			82,757			254,061			1,000,708
Provision for losses		212,278			—			51,782			264,060
Policy acquisition costs		53,297			—			42,875			96,172
Other operating expenses		96,442			28,166			27,821			152,429
Interest expense		16,065			2,346			9,477			27,888
Total expenses		378,082			30,512			131,955			540,549
Gain/(loss) on disposition of investments		1,371			(1,666	)		8,922			8,627
Change in fair value of derivative instruments		(606	)		35			(6,084	)		(6,655	)
Net gains/(losses)		765			(1,631	)		2,838			1,972
Pretax income		286,573			50,614			124,944			462,131
Income tax provision		77,614			20,247			33,846			131,707
Net income	$	208,959		$	30,367		$	91,098		$	330,424
Total assets	$	3,692,010		$	286,546		$	2,174,838		$	6,153,394
Deferred policy acquisition costs		76,844			—			135,234			212,078
Reserve for losses		499,583			—			169,463			669,046
Unearned premiums		104,064			—			580,867			684,931
Equity	$	1,760,328		$	234,106		$	1,128,447		$	3,122,881

* Reported on a GAAP basis.

3 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Key Financial Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Statutory Income Statements($ Thousands)

	Quarter ended						Nine months ended
	September 30 2003			September 30 2002			September 30 2003			September 30 2002
Revenues
Gross premiums written	$	45,558		$	23,391		$	166,823		$	82,938
Reinsurance premiums ceded		(236	)		—			(2,171	)		(1,568	)
Net premiums written		45,322			23,391			164,652			81,370
Increase in unearned premiums		(6,624	)		(2,990	)		(64,529	)		(24,180	)
Premiums earned		38,698			20,401			100,123			57,190
Net investment income		12,107			12,156			36,193			36,166
Net realized gain on sale of investments		1,131			3,153			6,063			6,320
Net investment gains		13,238			15,309			42,256			42,486
Other (expense) income		(1,752	)		33			(2,892	)		59
Total revenues		50,184			35,743			139,487			99,735
Expenses
Losses and loss adjustment expenses incurred		7,860			1,893			20,152			6,877
Commissions incurred		14,090			6,496			54,409			24,954
Other underwriting expenses		4,763			1,501			11,587			6,909
Total expenses		26,713			9,890			86,148			38,740
Income before income taxes		23,471			25,853			53,339			60,995
Federal and foreign income taxes		3,519			11,661			9,300			1,643
Net income	$	19,952		$	14,192		$	44,039		$	59,352
Financial Ratios
Loss and LAE Ratio		20.3	%		9.3	%		20.1	%		12.0	%
Underwriting Expense Ratio		41.6	%		34.2	%		40.1	%		39.2	%
Combined Ratio		61.9	%		43.5	%		60.2	%		51.2	%

Effective April 30, 2003, Radian Reinsurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Asset Assurance Inc.) whereby the Company assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

4 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Statutory Income Statements

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Statutory Balance Sheets($ Thousands)

	September 30 2003		December 31 2002
Assets
Long-term bonds	$	981,865	$	905,719
Cash and short-term investments		70,816		21,971
Receivable for securities		302		654
Total Investments		1,052,983		928,344
Investment income due and accrued		13,087		12,817
Premiums receivable		27,410		5,100
Funds held by reinsured companies		25,809		524
Current federal income tax recoverable		1,499		3,174
Net deferred tax asset		2,738		1,991
Receivable from affiliates		775		790
Other assets		2,166		1,360
Total Assets	$	1,126,467	$	954,100
Liabilities
Contingency reserve	$	253,840	$	280,376
Losses and loss adjustment expenses		62,445		16,114
Reinsurance payable on paid losses and loss adjustment expenses		4,908		1,262
Unearned premiums		433,839		369,310
Payable for securities		11,309		3,840
Commissions and contingent profit commissions		2,534		735
Ceded reinsurance premiums payable		1,485		7
Federal and foreign income taxes payable		3,541		—
Accrued expenses and other liabilities		8,962		10,320
Total Liabilities		782,863		681,964
Policyholders’ Surplus
Common stock		15,000		15,000
Additional paid-in capital		186,500		186,500
Unassigned funds		142,104		70,636
Total Policyholders’ Surplus		343,604		272,136
Total Liabilities and Policyholders’ Surplus	$	1,126,467	$	954,100
Qualified Statutory Capital	$	597,444	$	552,512

Effective April 30, 2003, Radian Reinsurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Asset Assurance Inc.) whereby the Company assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

5 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Statutory Balance Sheets

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Gross Premiums Written by Product($ Thousands)

	3rd Qtr 2003		3rd Qtr 2002		% Change		YTD 2003		YTD 2002		% Change
Public Finance	$	20,502	$	9,216	122	%	$	72,030	$	44,262	63	%
Structured Finance		11,923		9,862	21	%		38,564		30,367	27	%
Trade Credit Reinsurance		13,133		4,313	204	%		56,229		8,309	577	%
	$	45,558	$	23,391	95	%	$	166,823	$	82,938	101	%

Effective April 30, 2003, Radian Reinsurance Inc. (the “Company”) entered into an assumptive reinsurance agreement, in regard to its Trade Credit product, with an affiliated company (Radian Asset Assurance Inc.) whereby the Company assumed unearned premiums of $21.5 million and loss and loss adjustment reserves of $38.2 million. This transaction had no impact on net income.

Total Claims-Paying Resources and Leverage Ratios

($ Thousands except ratios)

	September 30 2003		December 31 2002		% Change
Capital and Surplus	$	343,604	$	272,136	26	%
Contingency Reserve		253,840		280,376	–9	%
Qualified Statutory Capital		597,444		552,512	8	%
Unearned Premium Reserve		433,839		369,310	17	%
Loss and Loss Expense Reserves		62,445		16,114	288	%
Total Policyholders’ Reserves		1,093,728		937,936	17	%
Present Value of Future Installment Premiums		266,662		249,108	7	%
Reinsurance and Soft-Capital Facilities		125,000		150,000	–17	%
Total Claims-Paying Resources	$	1,485,390	$	1,337,044	11	%
Total Debt Service (Principal and Interest) Outstanding	$	91,309,053	$	82,674,463	10	%
Capital Leverage Ratio1		153:1		150:1
Claims-Paying Ratio2		61:1		62:1

1 Capital Leverage Ratio: Total debt service/Qualified statutory capital.

2 Claims-Paying Ratio: Total debt service/Total claims-paying resources.

6 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Gross Premiums / Total Claims-Paying Resources

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Investment Portfolio Highlights

Asset Quality

As of September 30, 2003, the book value of our investment portfolio was $1.0 billion, with an average duration of 5.6 years.

[GRAPHIC APPEARS HERE]

Asset Class

Our conservative portfolio is invested primarily in fixed-income securities. Our primary objective is to achieve total return, with a secondary objective of maximizing after-tax income.

[GRAPHIC APPEARS HERE]

7 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Investment Portfolio Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Insured Portfolio Highlights($ Thousands)   Geographic Diversification

State	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
California	$	5,424,346	9.4	%	$	5,054,594	9.8	%
New York		3,681,339	6.4	%		3,361,363	6.6	%
Texas		2,728,850	4.7	%		2,221,825	4.4	%
Florida		2,434,964	4.2	%		2,376,386	4.7	%
Illinois		2,290,459	4.0	%		2,298,487	4.5	%
New Jersey		1,954,136	3.4	%		1,935,968	3.8	%
Massachusetts		1,882,268	3.3	%		1,791,923	3.5	%
Pennsylvania		1,867,357	3.2	%		1,791,052	3.5	%
Puerto Rico		1,091,886	1.9	%		1,092,288	2.1	%
Washington		1,013,199	1.7	%		928,917	1.8	%
Total of top ten states		24,368,804	42.2	%		22,852,803	44.7	%
Total of other states		15,270,048	26.4	%		14,208,643	27.8	%
Domestic structured finance		12,134,402	21.0	%		9,885,628	19.4	%
International		5,969,712	10.4	%		4,124,347	8.1	%
Total	$	57,742,966	100.0	%	$	51,071,421	100.0	%

8 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Insured Portfolio Highlights($ Thousands)   Sector Breakout

Public Finance	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
General Obligations	$	11,558,874	20.0	%	$	10,560,096	20.7	%
Utilities		7,374,622	12.7	%		6,802,514	13.3	%
Transportation		6,939,349	12.0	%		5,952,153	11.7	%
Healthcare		6,351,432	11.0	%		6,204,510	12.1	%
Tax-Backed		3,644,251	6.3	%		3,377,458	6.6	%
Investor-Owned Utilities		2,109,332	3.7	%		1,904,838	3.7	%
Education		1,856,714	3.2	%		1,575,248	3.1	%
Housing		1,198,899	2.1	%		1,184,544	2.3	%
Other Public Finance		644,694	1.1	%		672,199	1.3	%
AAA Wrap Municipal		405,073	0.7	%		405,496	0.8	%
Long-Term Care		93,932	0.2	%		94,790	0.2	%
Subtotal Public Finance	$	42,177,172	73.0	%	$	38,733,846	75.8	%
Structured Finance	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
Asset-Backed – Consumer	$	6,193,786	10.7	%	$	5,514,421	10.8	%
Collateralized Debt Obligations		4,205,132	7.3	%		2,552,035	5.0	%
Asset-Backed – Commercial and Other		2,810,662	4.9	%		2,489,820	4.9	%
Asset-Backed – Mortgage and MBS		1,621,123	2.8	%		992,167	1.9	%
Other Structured Finance		735,091	1.3	%		789,132	1.6	%
Subtotal Structured Finance	$	15,565,794	27.0	%	$	12,337,575	24.2	%
Total	$	57,742,966	100.0	%	$	51,071,421	100.0	%

9 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Insured Portfolio Highlights($ Thousands)   Rating Distribution

Rating*	Net Par (9/30/2003)		Percent of total		Net Par (12/31/2002)		Percent of total
AAA	$	6,981,620	12.0	%	$	4,107,705	8.0	%
AA		14,444,527	25.0	%		12,018,943	23.5	%
A		23,763,355	41.2	%		21,409,661	41.9	%
BBB		10,185,450	17.6	%		9,616,900	18.8	%
Investment Grade		204,495	0.4	%		445,010	0.9	%
Below Investment Grade		614,808	1.1	%		512,053	1.0	%
Not Rated		1,548,711	2.7	%		2,961,149	5.9	%
Total	$	57,742,966	100.0	%	$	51,071,421	100.0	%

* Indicated category reflects highest rating of the three rating agencies.

10 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Insured Portfolio Highlights($ Thousands)   10 Largest Public Finance Exposures

	Net Par (9/30/2003)		Percent of total Net Par		Rating*
Port Authority New York & New Jersey	$	352,405	0.61	%	AA–
Long Island Power Authority		334,019	0.58	%	A–
San Francisco California City & County Airports		312,810	0.54	%	A+
Illinois State GO		302,764	0.52	%	AA
Denver Colorado Airport Revenue		276,660	0.48	%	A
California State Public Works Board		276,628	0.48	%	A–
Houston Texas – Water & Sewer		260,385	0.45	%	A
Philadelphia PA Gas Works		253,743	0.44	%	A
Jefferson County AL Sewer		245,953	0.43	%	A
Puerto Rico Commonwealth Highway & Transit		238,643	0.41	%	A
Total top ten	$	2,854,010	4.94	%

10 Largest Structured Finance Exposures

	Net Par (9/30/2003)		Percent of total Net Par		Rating*
Pilgrim Principal Protection Fund	$	308,064	0.53	%	AAA
European Static Synthetic CDO		288,000	0.50	%	AAA
U.S. Static Synthetic CDO		285,000	0.49	%	AA
Providian Gateway Master Trust		244,158	0.42	%	BBB
European RMBS		225,028	0.39	%	AAA
European RMBS		225,028	0.39	%	AAA
U.S. Static Synthetic CDO		204,000	0.35	%	AAA
Mid-State Homes Trust IV		192,200	0.33	%	BBB
U.S. Static Synthetic CDO		180,000	0.32	%	AAA
U.S. Static Synthetic CDO		180,000	0.32	%	AAA
Total top ten	$	2,331,478	4.04	%

* Indicated category reflects highest rating of the three rating agencies.

11 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Insured Portfolio Highlights

Quarterly   Operating   Supplement Radian Reinsurance Inc.   Management Team

Martin A. Kamarck

President

David J. Beidler

Senior Vice President, Chief Legal Officer

Edward McC. Bowers

Senior Vice President, Global Structured Products

Sally B. Campbell

Senior Vice President, Public Finance

John C. DeLuca

Senior Vice President, Market Development

Bonita Z. Dorland

Senior Vice President, Chief Risk Officer

Andrew C.J. Poole

Managing Director, Radian Representatives Ltd.

Jack Praschnik

Senior Vice President, Global Strategies

Patrick Rossi

Senior Vice President, Controller

Jeffrey C. Salton

Senior Vice President, Operations and Analysis

12 Quarterly Operating Supplement for the Period Ended September 30, 2003 /Radian Reinsurance Inc. Management Team