Radian (RDN) 8-K Radian Reports Second Quarter 2004 Net Income of $121 Million

Exhibit 99

1601 Market Street Philadelphia, Pennsylvania 19103-2337 800 523.1988 215 564.6600 News Release

Contact:
For investors	–	Mona Zeehandelaar – phone: 215 231.1674
		email: mona.zeehandelaar@radian.biz
For the media	–	Emily Riley – phone: 215 231.1328
		email: emily.riley@radian.biz

Radian Reports Second Quarter 2004 Net Income of $121 Million

PHILADELPHIA, Pa., July 21, 2004 — Radian Group Inc. (NYSE: RDN) today reported its results for the quarter ended June 30, 2004. The key financial highlights of the quarter and six months ended June 30, 2004 are shown in the following tables:

Key Financial Highlights (dollars in millions, except per share data)

Second Quarter:

	Quarter Ended June 30, 2004		Quarter Ended June 30, 2003		Percent Change
Net income	$	120.5	$	111.7	8	%
Net income per share	$	1.27	$	1.18	8	%
Net premiums written	$	331.3	$	273.9	21	%
Premiums earned	$	259.2	$	255.0	2	%
Revenues	$	369.7	$	351.3	5	%
Book value per share (as of 6/30)	$	35.79	$	32.40	10	%
Equity in net income of affiliates	$	52.2	$	33.9	54	%

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Six Months:

	Six Months Ended June 30, 2004		Six Months Ended June 30, 2003		Percent Change
Net income	$	240.5	$	216.4	11	%
Net income per share	$	2.53	$	2.29	10	%
Net premiums written	$	512.7	$	526.3	(3	%)
Net premiums written*	$	609.1	$	526.3	16	%
Premiums earned	$	502.7	$	481.1	4	%
Premiums earned*	$	527.6	$	481.1	10	%
Revenues	$	703.7	$	653.5	8	%
Equity in net income of affiliates	$	84.7	$	48.7	74	%

* These amounts exclude the impact of one of the primary insurer’s recapture of business from Radian Reinsurance, which is described in Radian’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on February 11, 2004. A reconciliation and additional information about the impact of this recapture can be found in Schedules 1 and 2 to this release.

“The combined success of our financial guaranty, financial services and mortgage insurance businesses produced strong results this quarter,” stated Radian’s Chairman and CEO Frank P. Filipps. “Three years ago, we set a goal to generate more than 50% of our income from non-mortgage insurance sources, and we achieved that this quarter. The business platform we’ve created provides Radian’s shareholders with a strong revenue and earnings stream, and book value growth.”

Filipps added, “With notable growth in written premium of 21% and net income of 8%, Radian continued to deliver strong results within a fluctuating interest rate and credit spread environment.”

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Radian will hold a conference call to discuss its second quarter results on Thursday, July 22, 2004, at 9:00 a.m. Eastern time. This call will be broadcast live over the Internet at www.ir.radiangroupinc.com/phoenix.zhtml?c=112301&p=irol-audioarchives, or at www.radiangroupinc.com, under “News.” A replay of the webcast will be available at this site approximately two hours after the live broadcast ends and a transcript of the call will be available at this site approximately 24 hours after the call ends, both for a period of one year. Statistical and financial information, which is expected to be referred to during the conference call, will be available on Radian’s website under “Investor Information – News and Events – Webcasts and Presentations” or will be accessible by clicking on www.ir.radiangroupinc.com/phoenix.zhtml?c=112301&p=irol-audioarchives.

Radian Group Inc. is a leading credit enhancement provider to the global financial and capital markets, headquartered in Philadelphia. Radian’s subsidiaries provide products and services through three business lines: financial guaranty, mortgage insurance and other financial services. Additional information may be found at www.radiangroupinc.com.

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Financial Results and Supplemental Information Contents

• Condensed Consolidated Statements of Income

• Condensed Consolidated Balance Sheets

• Segment Information Quarter Ended June 30, 2004

• Segment Information Quarter Ended June 30, 2003

• Segment Information Six Months Ended June 30, 2004

• Segment Information Six Months Ended June 30, 2003

• Financial Guaranty Insurance Supplemental Information

• Mortgage Insurance Supplemental Information: New Insurance Written, Risk Written and Captives

• Mortgage Insurance Supplemental Information: Insurance in Force and Risk in Force

• Mortgage Insurance Supplemental Information: Risk in Force by LTV and Policy Year

• Mortgage Insurance Supplemental Information: Claims and Defaults

• Mortgage Insurance Supplemental Information: ALT A

• Financial Services Supplemental Information

• Supplemental Schedule 1: Reinsurance Clawback Impact on Radian Group

• Supplemental Schedule 2: Reinsurance Clawback Impact on Financial Guaranty

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Radian Group Inc. and Subsidiaries

Condensed Consolidated Statements of Income

	Quarter Ended June 30					Six Months Ended June 30
(Thousands of dollars, except per share data)	2004		2003			2004		2003
Revenues:
Net premiums written	$	331,269	$	273,896		$	512,697	$	526,256
Premiums earned		259,249		255,012			502,669		481,141
Net investment income		50,879		47,004			100,584		93,676
Equity in net income of affiliates		52,172		33,859			84,654		48,747
Other income		7,396		15,403			15,796		29,960
Total revenues		369,696		351,278			703,703		653,524
Expenses:
Provision for losses		116,560		95,540			231,327		163,298
Policy acquisition costs		31,372		31,368			53,655		62,385
Other operating expenses		52,424		56,565			105,583		101,006
Interest expense		8,364		9,652			18,018		18,236
Total expenses		208,720		193,125			408,583		344,925
Gains and losses:
Gain/loss on sales of investments		5,287		2,824			31,963		6,849
Change in fair value of derivative instruments		12		(4,829	)		4,659		(12,727	)
Total gains and losses		5,299		(2,005	)		36,622		(5,878	)
Pretax income		166,275		156,148			331,742		302,721
Provision for income taxes		45,772		44,474			91,229		86,275
Net income	$	120,503	$	111,674		$	240,513	$	216,446
Net income available to common stockholders	$	120,503	$	111,674		$	240,513	$	216,446
Net income per share	$	1.27	$	1.18		$	2.53	$	2.29
Weighted average shares outstanding (in thousands)		94,903		94,360			94,991		94,328

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Radian Group Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Thousands of dollars, except per share data)	June 30 2004		December 31 2003		June 30 2003
Assets:
Cash and investments	$	5,115,709	$	5,074,531	$	4,769,202
Investments in affiliates		337,795		328,478		282,765
Deferred policy acquisition costs		207,508		218,779		206,613
Prepaid federal income taxes		420,840		358,840		310,736
Other assets		448,860		465,139		483,642
Total assets	$	6,530,712	$	6,445,767	$	6,052,958
Liabilities and stockholders’ equity:
Unearned premiums	$	726,689	$	718,649	$	662,292
Reserve for losses and loss adjustment expenses		775,375		790,380		653,382
Long-term debt		717,514		717,404		717,291
Deferred federal income taxes		700,252		712,354		659,252
Other liabilities		265,188		281,136		334,737
Total liabilities		3,185,018		3,219,923		3,026,954
Common stock		96		96		95
Additional paid-in capital		1,168,271		1,199,056		1,180,701
Retained earnings		2,123,201		1,886,548		1,720,843
Accumulated other comprehensive income		54,126		140,144		124,365
Total common stockholders’ equity		3,345,694		3,225,844		3,026,004
Total liabilities and stockholders’ equity	$	6,530,712	$	6,445,767	$	6,052,958
Book value per share	$	35.79	$	34.31	$	32.40

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Radian Group Inc. and Subsidiaries

Segment Information

Quarter Ended June 30, 2004

(Thousands of dollars)	Mortgage Insurance			Financial Services			Financial Guaranty		Total
Revenues:
Net premiums written	$	236,459		$	—		$	94,810	$	331,269
Premiums earned	$	199,487		$	—		$	59,762	$	259,249
Net investment income		29,703			26			21,150		50,879
Equity in net income of affiliates		—			51,885			287		52,172
Other income		5,734			848			814		7,396
Total revenues		234,924			52,759			82,013		369,696
Expenses:
Provision for losses		101,039			—			15,521		116,560
Policy acquisition costs		17,077			—			14,295		31,372
Other operating expenses		36,452			4,336			11,636		52,424
Interest expense		4,909			586			2,869		8,364
Total expenses		159,477			4,922			44,321		208,720
Gains and losses:
Gain/loss on sales of investments		4,101			(574	)		1,760		5,287
Change in fair value of derivative instruments		(1,212	)		(14	)		1,238		12
Total gains and losses		2,889			(588	)		2,998		5,299
Pretax income		78,336			47,249			40,690		166,275
Income tax provision		21,651			16,537			7,584		45,772
Net income	$	56,685		$	30,712		$	33,106	$	120,503
Assets	$	3,910,910		$	314,756		$	2,305,046	$	6,530,712
Deferred policy acquisition costs		79,359			—			128,149		207,508
Reserve for losses and loss adjustment expenses		527,059			—			248,316		775,375
Unearned premiums		128,190			—			598,499		726,689
Equity		1,907,478			255,175			1,183,041		3,345,694

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Radian Group Inc. and Subsidiaries

Segment Information

Quarter Ended June 30, 2003

(Thousands of dollars)	Mortgage Insurance		Financial Services			Financial Guaranty			Total
Revenues:
Net premiums written	$	190,227	$	—		$	83,669		$	273,896
Premiums earned	$	189,718	$	—		$	65,294		$	255,012
Net investment income		26,753		2			20,249			47,004
Equity in net income of affiliates		—		28,345			5,514			33,859
Other income		7,817		6,424			1,162			15,403
Total revenues		224,288		34,771			92,219			351,278
Expenses:
Provision for losses		76,037		—			19,503			95,540
Policy acquisition costs		17,444		—			13,924			31,368
Other operating expenses		33,188		13,063			10,314			56,565
Interest expense		5,562		861			3,229			9,652
Total expenses		132,231		13,924			46,970			193,125
Gains and losses:
Gain/loss on sales of investments		475		(1,037	)		3,386			2,824
Change in fair value of derivative instruments		3,558		27			(8,414	)		(4,829	)
Total gains and losses		4,033		(1,010	)		(5,028	)		(2,005	)
Pretax income		96,090		19,837			40,221			156,148
Income tax provision		25,904		7,925			10,645			44,474
Net income	$	70,186	$	11,912		$	29,576		$	111,674
Assets	$	3,626,022	$	272,263		$	2,154,673		$	6,052,958
Deferred policy acquisition costs		76,404		—			130,209			206,613
Reserve for losses and loss adjustment expenses		490,579		—			162,803			653,382
Unearned premiums		108,819		—			553,473			662,292
Equity		1,689,161		220,753			1,116,090			3,026,004

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Radian Group Inc. and Subsidiaries

Segment Information

Six Months Ended June 30, 2004

(Thousands of dollars)	Mortgage Insurance		Financial Services		Financial Guaranty			Total
Revenues:
Net premiums written	$	442,128	$	—	$	70,569		$	512,697
Premiums earned	$	406,603	$	—	$	96,066			502,669
Net investment income		58,216		74		42,294			100,584
Equity in net income (loss) of affiliates		—		85,287		(633	)		84,654
Other income		11,220		3,722		854			15,796
Total revenues		476,039		89,083		138,581			703,703
Expenses:
Provision for losses		199,162		—		32,165			231,327
Policy acquisition costs		34,219		—		19,436			53,655
Other operating expenses		74,198		8,315		23,070			105,583
Interest expense		10,412		1,310		6,296			18,018
Total expenses		317,991		9,625		80,967			408,583
Gains and losses:
Gain/loss on sales of investments		28,223		2,599		1,141			31,963
Change in fair value of derivative instruments		3,214		35		1,410			4,659
Total gains and losses		31,437		2,634		2,551			36,622
Pretax income		189,485		82,092		60,165			331,742
Income tax provision		52,298		28,732		10,199			91,229
Net income	$	137,187	$	53,360	$	49,966		$	240,513

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Radian Group Inc. and Subsidiaries

Segment Information

Six Months Ended June 30, 2003

(Thousands of dollars)	Mortgage Insurance			Financial Services			Financial Guaranty			Total
Revenues:
Net premiums written	$	354,399		$	—		$	171,257		$	525,656
Premiums earned	$	357,750		$	—		$	123,391		$	481,141
Net investment income		54,582			36			39,058			93,676
Equity in net income of affiliates		—			43,289			5,458			48,747
Other income		14,416			12,785			2,759			29,960
Total revenues		426,748			56,110			170,666			653,524
Expenses:
Provision for losses		130,204			—			33,094			163,298
Policy acquisition costs		34,923			—			27,462			62,385
Other operating expenses		62,596			20,224			18,186			101,006
Interest expense		10,662			1,473			6,101			18,236
Total expenses		238,385			21,697			84,843			344,925
Gains and losses:
Gain/loss on sales of investments		865			(918	)		6,902			6,849
Change in fair value of derivative instruments		(26	)		27			(12,728	)		(12,727	)
Total gains and losses		839			(891	)		(5,826	)		(5,878	)
Pretax income		189,202			33,522			79,997			302,721
Income tax provision		51,358			13,399			21,518			86,275
Net income	$	137,844		$	20,123		$	58,479		$	216,446

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Radian Group Inc.

Financial Guaranty Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	Quarter Ended June 30				Six Months Ended June 30
(Thousands of dollars, except ratios)	2004		2003		2004		2003
Net Premiums Written:
Public finance direct	17,678		11,280		25,865		21,548
Public finance reinsurance	16,429		24,019		36,897		47,550
Structured direct	35,486		19,892		53,233		37,702
Structured reinsurance	8,594		13,364		17,406		27,732
Trade credit	16,623		15,114		33,585		36,725
	94,810		83,669		166,986		171,257
Impact of recapture(1)	—		—		(96,417	)	—
Net Premiums Written	94,810		83,669		70,569		171,257
Net Premiums Earned:
Public finance direct	6,390		4,388		12,189		8,275
Public finance reinsurance	9,883		12,775		21,085		23,853
Structured direct	19,135		20,062		37,581		38,474
Structured reinsurance	7,931		13,066		17,663		25,349
Trade credit	16,423		15,003		32,440		27,440
	59,762		65,294		120,958		123,391
Impact of recapture(1)	—		—		(24,892	)	—
Net Premiums Earned	59,762		65,294		96,066		123,391
Claims paid:
Trade credit	8,562		4,249		15,190		8,473
Financial guaranty	14,529		1,267		17,166		1,671
Conseco	7,677		—		15,082		—
Total	30,768		5,516		47,438		10,144
Impact of recapture(1)	—		—		11,488		—
Claims paid	30,768		5,516		58,926		10,144
Incurred losses:
Trade credit	8,432		8,941		16,634		16,329
Financial guaranty	7,089		10,562		15,531		16,765
Conseco	—		—		—		—
Total	15,521		19,503		32,165		33,094
Loss ratio-GAAP Basis	26.0	%	29.9	%	33.5	%	26.8	%
Expense ratio-GAAP Basis	43.4	%	37.1	%	44.2	%	37.0	%
	69.4	%	67.0	%	77.7	%	63.8	%
Refundings included in earned premium	366		3,296		2,272		4,905

⁽¹⁾ Amounts recorded related to the recapture of previously ceded business by one of the primary insurers in the first quarter of 2004.

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Radian Group Inc.

Financial Guaranty Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

(Thousands of dollars, except ratios)	June 30 2004	December 31 2003	June 30 2003
Capital and surplus	1,004,704	826,550	767,856
Contingency reserve	225,255	321,312	306,773
Qualified statutory capital	1,229,959	1,147,862	1,074,629
Unearned premium reserve	690,627	735,156	658,738
Loss and loss expense reserve	163,322	95,130	84,626
Total policyholders’ reserves	2,083,908	1,978,148	1,817,993
Present value of installment premiums	339,211	444,368	452,976
Reinsurance and soft capital facilities	245,000	275,000	125,000
Total claims paying resources	2,668,119	2,697,516	2,395,969
Net debt service outstanding	98,840,898	117,900,058	114,744,064
Capital leverage ratio(2)	80	103	107
Claims paying leverage ratio(3)	37	44	48
Reserve for losses and LAE
Specific	51,057	86,378	85,328
Conseco	96,168	111,000	—
Non-specific	101,090	79,529	77,475
Total	248,315	276,907	162,803

⁽²⁾ Net debt service outstanding divided by qualified statutory capital

⁽³⁾ Net debt service outstanding divided by total claims paying resources

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Radian Group Inc.

Mortgage Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	Quarter Ended June 30										Six Months Ended June 30
	2004			%		2003			%		2004			%			2003			%
Primary New Insurance Written (in millions)
Flow		10,427		88.6	%		13,267		73.2	%		19,269		89.9	%			23,856		60.5	%
Structured		1,339		11.4	%		4,859		26.8	%		2,163		10.1	%			15,546		39.5	%
Total		11,766		100.0	%		18,126		100.0	%		21,432		100.0	%			39,402		100.0	%
Prime		8,010		68.1	%		11,710		64.6	%		14,281		66.6	%			25,210		64.0	%
Alt-A		2,403		20.4	%		4,070		22.5	%		4,890		22.8	%			9,174		23.3	%
A minus and below		1,353		11.5	%		2,346		12.9	%		2,261		10.6	%			5,018		12.7	%
Total		11,766		100.0	%		18,126		100.0	%		21,432		100.0	%			39,402		100.0	%
Total Primary New Insurance Written by FICO Score (in millions)
<=619		1,095		9.3	%		2,106		11.6	%		1,800		8.4	%			4,519		11.5	%
620-679		3,601		30.6	%		5,850		32.3	%		6,810		31.8	%			11,373		28.8	%
680-739		4,128		35.1	%		6,133		33.8	%		7,814		36.4	%			13,298		33.8	%
>=740		2,942		25.0	%		4,037		22.3	%		5,008		23.4	%	��		10,212		25.9	%
Total		11,766		100.0	%		18,126		100.0	%		21,432		100.0	%			39,402		100.0	%
Percentage of primary new insurance written
Monthlies		90	%				85	%				92	%					90	%
Refinances		41	%				53	%				42	%					55	%
95.01% LTV and above		10	%				23	%				11	%					18	%
ARMs		36	%				24	%				35	%					38	%
Primary risk written (in millions)
Flow		2,596		87.6	%		3,172		69.7	%		4,909		88.5	%			5,714		57.5	%
Structured		367		12.4	%		1,377		30.3	%		639		11.5	%			4,219		42.5	%
Total		2,963		100.0	%		4,549		100.0	%		5,548		100.0	%			9,933		100.0	%
Pool risk written (in millions)		238					502					324						565
Other risk written (in millions)
Seconds		10										62
NIMS and other		52										220
Total other risk written		62										282
Loss ratio-GAAP Basis		50.7	%				40.1	%				49.0	%					36.4	%
Expense ratio-GAAP Basis		26.8	%				26.7	%				26.6	%					27.3	%
		77.5	%				66.8	%				75.6	%					63.7	%
Captives
Premiums ceded to captives($ millions)	$	22.7				$	17.6				$	41.9					$	36.1
% of total premiums		12.1	%				9.9	%				10.9	%					10.3	%
NIW subject to captives($ millions)	$	5,057				$	5,394				$	9,406					$	10,691
% of primary NIW		43.0	%				29.9	%				43.9	%					34.1	%
IIF subject to captives		31.7	%				28.0	%
RIF subject to captives		33.7	%				29.6	%
Persistency (twelve months ended June 30)		53.9	%				52.0	%

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Radian Group Inc.

Mortgage Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	June 30				December 31			June 30
	2004		%		2003	%		2003	%
Primary insurance in force (in millions)
Flow	91,449		78.7	%	91,709	76.5	%	91,675	75.1	%
Structured	24,730		21.3	%	28,178	23.5	%	30,411	24.9	%
Total	116,179		100.0	%	119,887	100.0	%	122,086	100.0	%
Prime	80,931		69.6	%	82,096	68.5	%	86,595	70.9	%
Alt-A	22,519		19.4	%	23,710	19.8	%	21,020	17.2	%
A minus and below	12,729		11.0	%	14,081	11.7	%	14,471	11.9	%
Total	116,179		100.0	%	119,887	100.0	%	122,086	100.0	%
Primary risk in force (in millions)
Flow	22,301		83.8	%	22,261	82.1	%
Structured	4,305		16.2	%	4,845	17.9	%
Total	26,606		100.0	%	27,106	100.0	%
Prime	18,327		68.9	%	18,449	68.0	%	19,750	71.0	%
Alt-A	5,159		19.4	%	5,253	19.4	%	4,541	16.3	%
A minus and below	3,120		11.7	%	3,404	12.6	%	3,524	12.7	%
Total	26,606		100.0	%	27,106	100.0	%	27,815	100.0	%
Total Primary Risk in Force by FICO Score (in millions)
<=619	3,098		11.6	%	3,508	12.9	%	3,814	13.7	%
620-679	8,586		32.3	%	8,773	32.4	%	8,918	32.1	%
680-739	9,099		34.2	%	9,097	33.6	%	9,233	33.2	%
>=740	5,823		21.9	%	5,728	21.1	%	5,850	21.0	%
Total	26,606		100.0	%	27,106	100.0	%	27,815	100.0	%
Percentage of primary risk in force
Monthlies	91	%
Refinances	36	%
95.01% LTV and above	13	%
ARMs	26	%

-14-

Radian Group Inc.

Mortgage Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	June 30			December 31			June 30
	2004	%		2003	%	��	2003	%
Total Primary Risk in Force by LTV (in millions)
95.01% and above	3,324	12.5	%	3,067	11.3	%	2,582	9.3	%
90.01% to 95.00%	9,954	37.4	%	10,184	37.6	%	10,633	38.2	%
85.01% to 90.00%	9,903	37.2	%	10,024	37.0	%	10,376	37.3	%
85.00% and below	3,425	12.9	%	3,831	14.1	%	4,224	15.2	%
Total	26,606	100.0	%	27,106	100.0	%	27,815	100.0	%
Total Primary Risk in Force by Policy Year (in millions)
2001 and prior	5,615	21.1	%	7,837	28.9	%	11,607	41.7	%
2002	4,609	17.3	%	6,198	22.9	%	8,675	31.2	%
2003	11,100	41.7	%	13,071	48.2	%	7,533	27.1	%
2004	5,282	19.9	%	—	0.0	%	—	0.0	%
Total	26,606	100.0	%	27,106	100.0	%	27,815	100.0	%
Pool risk in force (in millions)	2,567			2,415			2,340
GSE Pool risk in force (in millions)	1,559			1,393			1,212
Other risk in force (in millions)
Seconds	657			725			821
NIMS and other	481			328			232
Total other risk in force	1,138			1,053			1,053
Risk to capital ratio-STAT Basis	10.5:1			11.4:1			11.5:1

-15-

Radian Group Inc.

Mortgage Insurance Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	Quarter Ended June 30		Six Months Ended June 30
	2004	2003	2004	2003
Direct claims paid (in thousands)
Prime	37,588	32,271	69,647	56,334
Alt-A	22,377	12,091	42,902	20,699
A Minus and below	23,809	17,169	46,443	31,104
Seconds	9,899	6,336	23,298	13,042
Total	93,673	67,867	182,290	121,179
Average claim paid (in thousands)
Prime	24.4	25.6	24.4	24.3
Alt-A	38.4	40.2	40.3	38.9
A Minus and below	26.6	26.1	27.1	25.4
Seconds	25.6	28.5	28.0	26.1
Total	27.5	27.8	28.2	26.5

	June 30 2004		December 31 2003		June 30 2003
Default Statistics
Primary insurance:
Prime
Number of insured loans	624,055		640,778		683,734
Number of loans in default	18,830		22,156		20,889
Percentage of loans in default	3.02	%	3.46	%	3.06	%
Alt A
Number of insured loans	131,694		138,571		120,943
Number of loans in default	7,997		7,343		5,272
Percentage of loans in default	6.07	%	5.30	%	4.36	%
A Minus and below
Number of insured loans	99,980		110,054		112,646
Number of loans in default	12,083		12,497		10,941
Percentage of loans in default	12.09	%	11.36	%	9.71	%
Total
Number of insured loans	855,729		889,403		917,323
Number of loans in default	38,910		41,996		37,102
Percentage of loans in default	4.55	%	4.72	%	4.04	%
Pool insurance:
Number of insured loans	575,934		599,140		599,428
Number of loans in default	6,206		5,738		5,554
Percentage of loans in default	1.08	%	0.96	%	0.93	%

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Radian Group Inc.

Mortgage Insurance Supplemental Information

For the Quarter Ended and as of June 30, 2004

ALT-A

	Quarter Ended June 30						Six Months Ended June 30
	2004	%		2003	%		2004	%		2003	%
Primary New Insurance Written by FICO Score (in millions)
<=619	25	1.0	%	5	0.1	%	45	0.9	%	10	0.1	%
620-659	309	12.9	%	961	23.6	%	773	15.8	%	1,724	18.8	%
660-679	435	18.1	%	798	19.6	%	879	18.0	%	1,338	14.6	%
680-739	1,133	47.1	%	1,656	40.7	%	2,257	46.2	%	3,493	38.1	%
>=740	501	20.9	%	650	16.0	%	936	19.1	%	2,609	28.4	%
Total	2,403	100.0	%	4,070	100.0	%	4,890	100.0	%	9,174	100.0	%
Primary Risk in Force by FICO Score (in millions)
<=619	85	1.6	%	94	2.0	%
620-659	1,154	22.4	%	1,204	26.5	%
660-679	889	17.2	%	739	16.3	%
680-739	2,133	41.4	%	1,738	38.3	%
>=740	898	17.4	%	766	16.9	%
Total	5,159	100.0	%	4,541	100.0	%
Primary Risk in Force by LTV (in millions)
95.01% and above	463	9.0	%	291	6.4	%
90.01% to 95.00%	1,842	35.7	%	1,505	33.2	%
85.01% to 90.00%	2,098	40.7	%	1,831	40.3	%
85.00% and below	756	14.6	%	914	20.1	%
Total	5,159	100.0	%	4,541	100.0	%
Primary Risk in Force by Policy Year (in millions)
2001 and prior	526	10.2	%	1,057	23.3	%
2002	981	19.0	%	1,915	42.2	%
2003	2,381	46.2	%	1,569	34.5	%
2004	1,271	24.6	%	—	0.0	%
Total	5,159	100.0	%	4,541	100.0	%

-17-

Radian Group Inc.

Financial Services Supplemental Information

For the Quarter and Six Months Ended and as of June 30, 2004

	Quarter Ended June 30			Six Months Ended June 30
(Thousands of dollars, except ratios)	2004	2003		2004	2003
Investment in Affiliate Reconciliation:
C-BASS
Balance, beginning of period	235,086	185,420		226,710	175,630
Net income for period	33,673	21,309		54,549	31,099
Dividends received	20,000	2,500		32,500	2,500
Balance, end of period	248,759	204,229		248,759	204,229
Sherman
Balance, beginning of period	48,217	41,049		65,979	52,142
Net income for period	18,212	7,070		30,738	12,190
Dividends received	20,750	—		49,800	12,450
Other comprehensive income	3,030	(1,891	)	1,792	(5,654	)
Balance, end of period	48,709	46,228		48,709	46,228
Portfolio Information:
C-BASS
Servicing portfolio	20,400,000	14,800,000
Total assets (in thousands)	3,860,941	2,287,502
Servicing income	38,413	29,469		74,027	58,217
Net interest income	35,230	29,830		72,182	57,923
Total revenues	144,330	110,556		249,059	177,445
Sherman
Total assets	463,587	525,171
Net revenues	124,678	60,277		223,653	112,325

-18-

Supplemental Schedule Schedule 1

Radian Group Inc. and Subsidiaries

The following schedule shows the Consolidated Income Statement as reported (Column 1) and adjustments (Column 2) to reflect the income statement impact of the recapture (referred to below as the clawback) of business previously ceded to the Company by one of the primary insurer customers of the financial guaranty segment. The adjusted numbers are shown in Column 3. The impact of the clawback (Column 2) reflects the clawback of business ceded to the Company in prior periods. This clawback only affected the first quarter (and, as a result, the year-to-date periods) of 2004. Accordingly, management believes that Column 3 provides useful information to investors by presenting a more meaningful basis of comparison for the Company's past and future results.

(Thousands of dollars, except per-share data)	As Reported Six Months Ended June 30 2004		Impact of Clawback			As Adjusted Six Months Ended June 30 Excluding Clawback		Six Months Ended June 30 2003
Revenues:
Net premiums written	$	512,697	$	(96,417	)	$	609,114	$	526,256
Premiums earned	$	502,669	$	(24,892	)	$	527,561	$	481,141
Net investment income		100,584		—			100,584		93,676
Equity in net income of affiliates		84,654		—			84,654		48,747
Other income		15,796		—			15,796		29,960
Total revenues		703,703		(24,892	)		728,595		653,524
Expenses:
Provision for losses		231,327		—			231,327		163,298
Policy acquisition costs		53,655		(9,766	)		63,421		62,385
Other operating expenses		105,583		—			105,583		101,006
Interest expense		18,018		—			18,018		18,236
Total expenses		408,583		(9,766	)		418,349		344,925
Gains and losses:
Gain/loss on sales of investments		31,963		—			31,963		6,849
Change in fair value of derivative instruments		4,659		(791	)		5,450		(12,727	)
Total gains and losses		36,622		(791	)		37,413		(5,878	)
Pretax income		331,742		(15,917	)		347,659		302,721
Provision for income taxes		91,229		(5,571	)		96,800		86,275
Net income	$	240,513	$	(10,346	)	$	250,859	$	216,446
Net income available to common stockholders	$	240,513	$	(10,346	)	$	250,859	$	216,446
Net income per share	$	2.53	$	(0.11	)	$	2.64	$	2.29
Weighted average shares outstanding (in thousands)		94,991					94,991		94,328

-19-

Supplemental Schedule Schedule 2

Segment Information-Financial Guaranty

Radian Group Inc. and Subsidiaries

The following schedule shows the Financial Guaranty Segment Income Statement as reported (Column 1) and adjustments (Column 2) to reflect the income statement impact of the recapture (referred to below as the clawback) of business previously ceded to the Company by one of the primary insurer customers of the financial guaranty segment. The adjusted numbers are shown in Column 3. The impact of the clawback (Column 2) reflects the clawback of business ceded to the Company in prior periods. This clawback only affected the first quarter (and, as a result, the year-to-date periods) of 2004. Accordingly, management believes that Column 3 provides useful information to investors by presenting a more meaningful basis of comparison for the Company's past and future results.

(Thousands of dollars)	As Reported Six Months Ended June 30 2004			Impact of Clawback			As Adjusted Six Months Ended June 30 Excluding Clawback			Six Months Ended June 30 2003
Revenues:
Net premiums written	$	70,569		$	(96,417	)	$	166,986		$	171,257
Premiums earned	$	96,066		$	(24,892	)	$	120,958		$	123,391
Net investment income		42,294			—			42,294			39,058
Equity in net income (loss) of affiliates		(633	)		—			(633	)		5,458
Other income		854			—			854			2,759
Total revenues		138,581			(24,892	)	$	163,473			170,666
Expenses:
Provision for losses		32,165			—			32,165			33,094
Policy acquisition costs		19,436			(9,766	)		29,202			27,462
Other operating expenses		23,070			—			23,070			18,186
Interest expense		6,296			—			6,296			6,101
Total expenses		80,967			(9,766	)		90,733			84,843
Gains and losses:
Gain/loss on sales of investments		1,141			—			1,141			6,902
Change in fair value of derivative instruments		1,410			(791	)		2,201			(12,728	)
Total gain and losses		2,551			(791	)		3,342			(5,826	)
Pretax income		60,165			(15,917	)		76,082			79,997
Income tax provision		10,199			(5,571	)		15,770			21,518
Net income	$	49,966		$	(10,346	)	$	60,312		$	58,479
Loss ratio-excluding Clawback								26.6	%		26.8	%
Expense ratio-excluding Clawback								43.2	%		37.0	%
								69.8	%		63.8	%

-20-

All statements in this press release that address operating performance, events or developments that we expect or anticipate may occur in the future are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the U.S. Private Securities Litigation Reform Act of 1995. These statements are made on the basis of management’s current views and assumptions with respect to future events. The forward-looking statements are subject to risks and uncertainties including the following: changes in general financial and political conditions, such as extended national or regional economic recessions (or expansions), changes in housing values, changes or volatility in interest rates, or other political instability; changes in investor perception of the strength of private mortgage insurers or financial guaranty providers, and risks faced by the businesses, municipalities or pools of assets covered by Radian’s insurance; the loss of significant customers with whom Radian has a concentration of its insurance in force; rising delinquencies in mortgage loans insured by Radian resulting from increased consolidation of mortgage lenders and servicers; increased severity or frequency of losses associated with certain Radian products that are riskier than traditional mortgage insurance and municipal guaranty insurance policies; material changes in persistency rates of Radian’s mortgage insurance policies; downgrades of the insurance financial-strength ratings assigned by the major ratings agencies to Radian’s operating subsidiaries; intense competition from others and from alternative products to private mortgage insurance and financial guaranty insurance; changes in the business practices of Fannie Mae and Freddie Mac; legislative and regulatory changes affecting demand for private mortgage insurance and financial guaranty insurance; changes in claims against mortgage insurance products resulting from the aging of Radian’s mortgage insurance policies; changes in Radian’s ability to maintain sufficient reinsurance capacity in an increasingly concentrated reinsurance market; vulnerability to the performance of Radian’s strategic investments; and the loss of executive officers or other key personnel. Investors are also directed to other risks discussed in documents filed by Radian with the SEC, including the factors detailed in our annual report on Form 10-K for the year ended December 31, 2003 in the section immediately preceding Part I of the report. Radian does not intend to and disclaims any duty or obligation to update or revise any forward-looking statements made in this press release to reflect new information, future events or for any other reason.

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-21-