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Investments | 9 Months Ended
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Sep. 30, 2023
Investments [Abstract] |
Investments | Investments Available for Sale Securities Our available for sale securities within our investment portfolio consisted of the following as of the dates indicated.
Available for sale securities
|  | September 30, 2023
(In thousands) |  | Amortized Cost |  |  |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Fixed-maturities available for sale |  |  |  |  |  |  |  |  |  |
U.S. government and agency securities |  | $ | 171,560 |  |  |  |  | $ | — |  |  | $ | (36,382) |  |  | $ | 135,178 |
State and municipal obligations |  | 158,658 |  |  |  |  | 4 |  |  | (25,093) |  |  | 133,569 |
Corporate bonds and notes |  | 2,853,366 |  |  |  |  | 120 |  |  | (394,766) |  |  | 2,458,720 |
RMBS |  | 1,089,098 |  |  |  |  | 5,446 |  |  | (135,334) |  |  | 959,210 |
CMBS |  | 618,127 |  |  |  |  | 27 |  |  | (57,802) |  |  | 560,352 |
CLO |  | 502,572 |  |  |  |  | 74 |  |  | (8,969) |  |  | 493,677 |
Other ABS |  | 328,896 |  |  |  |  | 105 |  |  | (8,913) |  |  | 320,088 |
Foreign government and agency securities |  | 5,125 |  |  |  |  | — |  |  | (92) |  |  | 5,033 |
Mortgage insurance-linked notes (1) |  | 49,264 |  |  |  |  | 1,424 |  |  | (6) |  |  | 50,682 |
Total securities available for sale, including loaned securities |  | 5,776,666 |  |  |  |  | $ | 7,200 |  |  | $ | (667,357) |  | (2) | 5,116,509 |
Less: loaned securities (3) |  | 93,294 |  |  |  |  |  |  |  |  | 78,762 |
Total fixed-maturities available for sale |  | $ | 5,683,372 |  |  |  |  |  |  |  |  | $ | 5,037,747 |
|  | December 31, 2022
(In thousands) |  | Amortized Cost |  |  |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
Fixed-maturities available for sale |  |  |  |  |  |  |  |  |  |
U.S. government and agency securities |  | $ | 174,138 |  |  |  |  | $ | 206 |  |  | $ | (28,902) |  |  | $ | 145,442 |
State and municipal obligations |  | 164,325 |  |  |  |  | — |  |  | (21,939) |  |  | 142,386 |
Corporate bonds and notes |  | 2,886,905 |  |  |  |  | 1,403 |  |  | (350,537) |  |  | 2,537,771 |
RMBS |  | 1,025,795 |  |  |  |  | 1,163 |  |  | (98,559) |  |  | 928,399 |
CMBS |  | 645,890 |  |  |  |  | 13 |  |  | (52,546) |  |  | 593,357 |
CLO |  | 518,677 |  |  |  |  | — |  |  | (20,485) |  |  | 498,192 |
Other ABS |  | 168,033 |  |  |  |  | 69 |  |  | (6,743) |  |  | 161,359 |
Foreign government and agency securities |  | 5,118 |  |  |  |  | — |  |  | (143) |  |  | 4,975 |
Mortgage insurance-linked notes (1) |  | 54,578 |  |  |  |  | 80 |  |  | (1,639) |  |  | 53,019 |
Total securities available for sale, including loaned securities |  | 5,643,459 |  |  |  |  | $ | 2,934 |  |  | $ | (581,493) |  | (2) | 5,064,900 |
Less: loaned securities (3) |  | 56,198 |  |  |  |  |  |  |  |  | 47,189 |
Total fixed-maturities available for sale |  | $ | 5,587,261 |  |  |  |  |  |  |  |  | $ | 5,017,711 |
(1)Includes mortgage insurance-linked notes purchased by Radian Group in connection with the Excess-of-Loss Program. See Note 8 for more information. (2)See “Gross Unrealized Losses and Related Fair Value of Available for Sale Securities” below for additional details. (3)Included in other assets in our condensed consolidated balance sheets. See “Loaned Securities” below for a discussion of our securities lending agreements. Gross Unrealized Losses and Related Fair Value of Available for Sale Securities For securities deemed “available for sale” that are in an unrealized loss position and for which an allowance for credit loss has not been established, the following tables show the gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates indicated. Included in the amounts as of September 30, 2023, and December 31, 2022, are loaned securities that are classified as other assets in our condensed consolidated balance sheets, as further described below.
Unrealized losses on fixed-maturities available for sale by category and length of time
|  |  |  | September 30, 2023
(In thousands) |  |  |  | Less Than 12 Months |  |  |  | 12 Months or Greater |  |  |  | Total
Description of Securities |  |  |  | Fair Value |  | Unrealized Losses |  |  |  | Fair Value |  | Unrealized Losses |  |  |  | Fair Value |  | Unrealized Losses
U.S. government and agency securities |  |  |  | $ | 18,644 |  |  | $ | (3,052) |  |  |  |  | $ | 106,409 |  |  | $ | (33,330) |  |  |  |  | $ | 125,053 |  |  | $ | (36,382) |
State and municipal obligations |  |  |  | 34,225 |  |  | (2,994) |  |  |  |  | 98,445 |  |  | (22,099) |  |  |  |  | 132,670 |  |  | (25,093) |
Corporate bonds and notes |  |  |  | 439,005 |  |  | (18,372) |  |  |  |  | 1,976,424 |  |  | (376,394) |  |  |  |  | 2,415,429 |  |  | (394,766) |
RMBS |  |  |  | 201,321 |  |  | (11,093) |  |  |  |  | 628,227 |  |  | (124,241) |  |  |  |  | 829,548 |  |  | (135,334) |
CMBS |  |  |  | 18,900 |  |  | (272) |  |  |  |  | 538,095 |  |  | (57,530) |  |  |  |  | 556,995 |  |  | (57,802) |
CLO |  |  |  | 14,841 |  |  | (19) |  |  |  |  | 445,391 |  |  | (8,950) |  |  |  |  | 460,232 |  |  | (8,969) |
Other ABS |  |  |  | 203,657 |  |  | (3,774) |  |  |  |  | 69,537 |  |  | (5,139) |  |  |  |  | 273,194 |  |  | (8,913) |
Mortgage insurance-linked notes |  |  |  | 3,125 |  |  | (6) |  |  |  |  | — |  |  | — |  |  |  |  | 3,125 |  |  | (6) |
Foreign government and agency securities |  |  |  | — |  |  | — |  |  |  |  | 5,033 |  |  | (92) |  |  |  |  | 5,033 |  |  | (92) |
Total |  |  |  | $ | 933,718 |  |  | $ | (39,582) |  |  |  |  | $ | 3,867,561 |  |  | $ | (627,775) |  |  |  |  | $ | 4,801,279 |  |  | $ | (667,357) |
|  |  |  | December 31, 2022
(In thousands) |  |  |  | Less Than 12 Months |  |  |  | 12 Months or Greater |  |  |  | Total
Description of Securities |  |  |  | Fair Value |  | Unrealized Losses |  |  |  | Fair Value |  | Unrealized Losses |  |  |  | Fair Value |  | Unrealized Losses
U.S. government and agency securities |  |  |  | $ | 86,964 |  |  | $ | (21,370) |  |  |  |  | $ | 47,770 |  |  | $ | (7,532) |  |  |  |  | $ | 134,734 |  |  | $ | (28,902) |
State and municipal obligations |  |  |  | 116,285 |  |  | (14,231) |  |  |  |  | 25,401 |  |  | (7,708) |  |  |  |  | 141,686 |  |  | (21,939) |
Corporate bonds and notes |  |  |  | 1,769,547 |  |  | (176,768) |  |  |  |  | 701,936 |  |  | (173,769) |  |  |  |  | 2,471,483 |  |  | (350,537) |
RMBS |  |  |  | 610,812 |  |  | (46,117) |  |  |  |  | 261,370 |  |  | (52,442) |  |  |  |  | 872,182 |  |  | (98,559) |
CMBS |  |  |  | 469,100 |  |  | (38,178) |  |  |  |  | 121,277 |  |  | (14,368) |  |  |  |  | 590,377 |  |  | (52,546) |
CLO |  |  |  | 246,705 |  |  | (10,271) |  |  |  |  | 245,584 |  |  | (10,214) |  |  |  |  | 492,289 |  |  | (20,485) |
Other ABS |  |  |  | 115,181 |  |  | (3,603) |  |  |  |  | 31,041 |  |  | (3,140) |  |  |  |  | 146,222 |  |  | (6,743) |
Mortgage insurance-linked notes |  |  |  | 43,745 |  |  | (1,639) |  |  |  |  | — |  |  | — |  |  |  |  | 43,745 |  |  | (1,639) |
Foreign government and agency securities |  |  |  | 4,975 |  |  | (143) |  |  |  |  | — |  |  | — |  |  |  |  | 4,975 |  |  | (143) |
Total |  |  |  | $ | 3,463,314 |  |  | $ | (312,320) |  |  |  |  | $ | 1,434,379 |  |  | $ | (269,173) |  |  |  |  | $ | 4,897,693 |  |  | $ | (581,493) |
There were 1,216 and 1,284 securities in an unrealized loss position at September 30, 2023, and December 31, 2022, respectively. We determined that these unrealized losses were due to non-credit factors and that, as of September 30, 2023, we did not expect to realize a loss for our investments in an unrealized loss position given our intent and ability to hold these investment securities until recovery of their amortized cost basis. See Note 2 of Notes to Consolidated Financial Statements in our 2022 Form 10-K for information regarding our accounting policy for impairments of investments. Loaned Securities We participate in a securities lending program whereby we loan certain securities in our investment portfolio to third-party borrowers for short periods of time. Although we report such securities at fair value within other assets in our condensed consolidated balance sheets, rather than within investments, the detailed information we provide in this Note 6 includes these securities. All of our securities lending agreements are classified as overnight and revolving. Securities collateral on deposit with us from third-party borrowers totaling $35 million and $16 million as of September 30, 2023, and December 31, 2022, respectively, may not be transferred or re-pledged unless the third-party borrower is in default, and is therefore not reflected in our condensed consolidated financial statements. See Note 5 herein for additional detail on the loaned securities, and see Note 6 of Notes to Consolidated Financial Statements in our 2022 Form 10-K for additional information about our accounting policies with respect to our securities lending agreements and the collateral requirements thereunder. Mortgage Loans Held for Sale The carrying value of mortgage loans held for sale owned by Radian Mortgage Capital totaled $138 million and $4 million at September 30, 2023, and December 31, 2022, respectively, and is based on fair value as discussed below. As of September 30, 2023, our mortgage loans held for sale consisted of 331 mortgage loans with a total unpaid principal balance of $139 million, related to properties in 35 states and the District of Columbia. As of September 30, 2023, none of these loans were greater than ninety days delinquent. Interest earned on mortgage loans held for sale is included in net investment income on our condensed consolidated statements of operations. We elected the fair value option for our mortgage loans held for sale to mitigate income statement volatility and allow for consistent treatment of both loans and any associated hedges or derivatives. Net gains (losses) associated with our mortgage loans held for sale and any related hedges are included in net gains (losses) on investments and other financial instruments on our condensed consolidated statements of operations. See Note 5 for additional information about the fair value of these financial instruments. We typically fund the purchases of our mortgage loans held for sale primarily with amounts borrowed under our mortgage loan financing facilities. See Note 12 for additional information on these facilities and their related terms. Net Gains (Losses) on Investments and Other Financial Instruments Net gains (losses) on investments and other financial instruments consisted of the following.
Net gains (losses) on investments and other financial instruments
|  | Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands) |  | 2023 |  | 2022 |  | 2023 |  | 2022
Net realized gains (losses) on investments sold or redeemed |  |  |  |  |  |  |  |
Fixed-maturities available for sale |  |  |  |  |  |  |  |
Gross realized gains |  | $ | 20 |  |  | $ | 411 |  |  | $ | 588 |  |  | $ | 2,554 |
Gross realized losses |  | (2,814) |  |  | (4,564) |  |  | (13,768) |  |  | (12,625) |
Fixed-maturities available for sale, net |  | (2,794) |  |  | (4,153) |  |  | (13,180) |  |  | (10,071) |
Trading securities |  | — |  |  | (30) |  |  | (402) |  |  | (136) |
Equity securities |  | — |  |  | — |  |  | 1,890 |  |  | 1,655 |
Mortgage loans held for sale |  | (99) |  |  | — |  |  | (94) |  |  | — |
Other investments |  | 19 |  |  | 44 |  |  | 56 |  |  | 98 |
Net realized gains (losses) on investments sold or redeemed |  | (2,874) |  |  | (4,139) |  |  | (11,730) |  |  | (8,454) |
Change in unrealized gains (losses) on investments sold or redeemed |  | 9 |  |  | 29 |  |  | 226 |  |  | (2,914) |
Net unrealized gains (losses) on investments still held |  |  |  |  |  |  |  |
Trading securities |  | (5,632) |  |  | (7,398) |  |  | (4,494) |  |  | (27,892) |
Equity securities |  | 290 |  |  | (7,256) |  |  | 4,991 |  |  | (32,249) |
Mortgage loans held for sale |  | (1,675) |  |  | — |  |  | (1,785) |  |  | — |
Other investments |  | (1) |  |  | (149) |  |  | (97) |  |  | (490) |
Net unrealized gains (losses) on investments still held |  | (7,018) |  |  | (14,803) |  |  | (1,385) |  |  | (60,631) |
Total net gains (losses) on investments |  | (9,883) |  |  | (18,913) |  |  | (12,889) |  |  | (71,999) |
Net gains (losses) on other financial instruments (1) |  | 1,328 |  |  | 2,661 |  |  | 9,683 |  |  | (15,579) |
Net gains (losses) on investments and other financial instruments |  | $ | (8,555) |  |  | $ | (16,252) |  |  | $ | (3,206) |  |  | $ | (87,578) |
(1)Includes changes in the fair value of derivatives, including embedded derivatives associated with our Excess-of-Loss program and derivatives that hedge interest rate risk related to our mortgage loans held for sale. Contractual Maturities The contractual maturities of fixed-maturities available for sale were as follows.
Contractual maturities of fixed-maturities available for sale
|  | September 30, 2023
(In thousands) |  | Amortized Cost |  | Fair Value
Due in one year or less |  | $ | 108,051 |  |  | $ | 106,300 |
Due after one year through five years (1) |  | 1,296,150 |  |  | 1,209,013 |
Due after five years through 10 years (1) |  | 917,687 |  |  | 781,903 |
Due after 10 years (1) |  | 866,821 |  |  | 635,284 |
Asset-backed and mortgage-backed securities (2) |  | 2,587,957 |  |  | 2,384,009 |
Total |  | 5,776,666 |  |  | 5,116,509 |
Less: loaned securities |  | 93,294 |  |  | 78,762 |
Total fixed-maturities available for sale |  | $ | 5,683,372 |  |  | $ | 5,037,747 |
(1)Actual maturities may differ as a result of calls before scheduled maturity. (2)Includes RMBS, CMBS, CLO, Other ABS and mortgage insurance-linked notes, which are not due at a single maturity date. Other Our fixed-maturities available for sale include securities totaling $13 million at both September 30, 2023, and December 31, 2022, on deposit and serving as collateral with various state regulatory authorities. Our fixed-maturities available for sale and trading securities also include securities serving as collateral for our FHLB advances. See Note 12 for additional information about our FHLB advances.

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