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Borrowings and Financing Activities
 3 Months Ended
Mar. 31, 2024
Long-Term Debt, Unclassified [Abstract]  
Borrowings and Financing Activities Borrowings and Financing Activities
The carrying value of our debt as of the dates indicated was as follows.
Borrowings
($ in thousands) Interest rateMarch 31,
2024		December 31,
2023
Senior notes
Senior Notes due 20244.500 %$449,354 $449,037 
Senior Notes due 20256.625 %— 522,343 
Senior Notes due 20274.875 %446,661 446,401 
Senior Notes due 20296.200 %616,845 — 
Total senior notes$1,512,860 $1,417,781 
($ in thousands)
Average interest rate (1)
March 31,
2024		December 31,
2023
Secured borrowings
FHLB advances
FHLB advances due 2024 (2)
4.730 %$56,875 $72,871 
FHLB advances due 20252.340 %12,684 12,684 
FHLB advances due 20264.469 %1,835 1,835 
FHLB advances due 20272.562 %7,887 7,887 
Total FHLB advances79,281 95,277 
Mortgage loan financing facilities7.097 %128,320 24,199 
Total secured borrowings$207,601 $119,476 
(1)As of March 31, 2024. See “FHLB Advances” and “Mortgage Loan Financing Facilities” below for more information.
(2)Includes $13 million of floating-rate advances with a weighted average interest rate of 5.532% and 5.602% as of March 31, 2024, and December 31, 2023, respectively, which resets daily based on changes in SOFR.
Interest expense consisted of the following.
Interest expense
Three Months Ended
March 31,
20242023
Senior notes$22,128 $20,288 
Loss on extinguishment of debt4,275 — 
Mortgage loan financing facilities1,438 77 
FHLB advances945 745 
Revolving credit facility260 311 
Other— 18 
Total interest expense$29,046 $21,439 
Senior Notes
Senior Notes due 2029. In March 2024, we issued $625 million aggregate principal amount of Senior Notes due 2029 and received net proceeds of $617 million. These notes mature on May 15, 2029, and bear interest at a rate of 6.200% per annum, payable semi-annually on May 15 and November 15 of each year, with interest payments commencing on November 15, 2024.
We have the option to redeem these notes, in whole or in part, at any time, or from time to time, prior to April 15, 2029 (the date that is one month prior to the maturity date of the notes) (the “Par Call Date”), at a redemption price equal to the
greater of (a) the make-whole amount, which is the sum of the present values of the remaining scheduled payments of principal and interest in respect of the notes to be redeemed discounted to the redemption date (assuming the Senior Notes due 2029 matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the applicable treasury rate plus 30 basis points less interest accrued to the redemption date, and (b) 100% of the aggregate principal amount of the notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to, but excluding, the redemption date. At any time on or after the Par Call Date, we may, at our option, redeem the notes in whole or in part, at a redemption price equal to 100% of the aggregate principal amount of the notes to be redeemed, plus accrued and unpaid interest thereon to, but excluding, the redemption date.
The indenture governing the Senior Notes due 2029 contains covenants customary for securities of this nature, including covenants related to the payments of the notes, reports to be provided, compliance certificates to be issued and the ability to modify the covenants. Additionally, the indenture includes covenants restricting us from encumbering the capital stock of a designated subsidiary (as defined in the indenture for the notes) or disposing of any capital stock of any designated subsidiary unless either all of the stock is disposed of for cash or property which is at least equal to the fair market value of the stock or we retain more than 80% of the stock.
Extinguishment of Debt
Redemption of Senior Notes due 2025. In March 2024, we exercised our right to redeem all of our outstanding Senior Notes due 2025 in the aggregate principal amount of $525 million, at a redemption price of 100.4% of the principal amount plus accrued and unpaid interest. We funded the redemption with $527 million in cash (which included accrued and unpaid interest due on the redeemed notes). This redemption resulted in a loss on extinguishment of debt of $4 million during the three months ended March 31, 2024, which is included in interest expense in our condensed consolidated statements of operations.
Following this redemption, there were no remaining principal amounts outstanding on the Senior Notes due 2025 at March 31, 2024.
FHLB Advances
The principal balance of the FHLB advances is required to be collateralized by eligible assets with a fair value that must be maintained generally within a minimum range of 103% to 114% of the amount borrowed, depending on the type of assets pledged. Our fixed-maturities available for sale include securities totaling $84 million and $101 million at March 31, 2024, and December 31, 2023, respectively, which serve as collateral for our FHLB advances to satisfy this requirement.
Mortgage Loan Financing Facilities
Radian Mortgage Capital has entered into Master Repurchase Agreements to finance the acquisition of residential mortgage loans and related mortgage loan assets. The Goldman Sachs Master Repurchase Agreement and the BMO Master Repurchase Agreement are uncommitted mortgage loan repurchase facilities, with maximum borrowing amounts of $100 million and $150 million, respectively, as of March 31, 2024. In April 2024, the BMO Master Repurchase Agreement was amended to increase the maximum borrowing amount to $400 million. The Goldman Sachs Master Repurchase Agreement and the BMO Master Repurchase Agreement are currently scheduled to expire on September 14, 2024, and September 25, 2024, respectively.
In January 2024, Radian Mortgage Capital entered into a master repurchase agreement with Flagstar Bank, N.A. (“Flagstar”). This agreement is an uncommitted mortgage loan repurchase facility with a maximum borrowing amount of $150 million pursuant to which Radian Mortgage Capital may from time to time sell to Flagstar, and later repurchase, certain residential mortgage loan assets. The Flagstar Master Repurchase Agreement is scheduled to expire on January 27, 2025.
The borrowings under the Master Repurchase Agreements bear a variable interest rate based on one-month SOFR or compounded SOFR, depending on the agreement, plus an applicable margin, with interest payable monthly. Principal is due upon the earliest of the sale or disposition of the related mortgage loans, the occurrence of certain default or acceleration events or at the termination date of the applicable Master Repurchase Agreement.
Funds advanced under the Master Repurchase Agreements generally will be calculated as a percentage of the unpaid principal balance or fair value of the residential mortgage loan assets, depending on the credit characteristics of the loans being purchased. Of our mortgage loans held for sale, $142 million and $31 million served as collateral for the Master Repurchase Agreements to support the funds advanced at March 31, 2024, and December 31, 2023, respectively.
Revolving Credit Facility
Radian Group has in place a $275 million unsecured revolving credit facility with a syndicate of bank lenders. As of March 31, 2024, there were no amounts outstanding under this facility.
Debt Covenants and Other Information
As of March 31, 2024, we are in compliance with all of our debt covenants, including for our senior notes. For more information regarding our borrowings and financing activities, including certain terms, covenants and Parent Guarantees provided by Radian Group in connection with particular borrowings, see Note 12 of Notes to Consolidated Financial Statements in our 2023 Form 10-K.