Presented by Rick Thornberry Chief Executive Officer Radian Group - PowerPoint PPT Presentation

Presented by Rick Thornberry Chief Executive Officer Radian Group Inc.

Rick Thornberry, CEO 2007-2009 Senior Advisor 1996 Financial Institution Investment President, COO Team for Leading Private Citicorp Mortgage Inc. Equity Firm BS, Business Administration (Accounting) 2006 St. Louis University Chairman, CEO, Co-Founder NexSpring Group 1981 1999 2017, March CPA at Deloitte President, CEO, Co-Founder CEO Nexstar Financial Corporation Radian Group 2017, October Elected to Board of Directors 1987 of the Mortgage Bankers Residential Services Association Corporation of America/Prudential Home Mortgage Company 4

Why I joined Radian Diversified Market Financial Strategic Products and Position Strength Opportunities Services 5

What I have learned since joining Our Team, Our Relationships, Our Strengths, Our Financial Flexibility and Our Opportunities. 6

We are a uniquely diversified mortgage risk management business Credit Transactions Real Estate Mortgage Insurance Originations Valuation Reinsurance Acquisitions Title Structured Mortgage Securitizations Brokerage Solutions Servicing Asset management Loans Securities Our mortgage insurance business provides the foundation to build from. Our broad capabilities provide strong building blocks for the future. 7

Radian has a long history of success Over the past 40 years, Radian has insured nearly 7 million loans. Over the last 5 years , Radian has written $228 billion in new insurance covering approximately 940,000 loans and paid more than $4 billion in claims. Clayton has reviewed more than 12 million loans and maintains a database of mortgage loans with more than $2 trillion in original loan balance. Red Bell maintains more than 58 million properties in its proprietary database. 8

Today’s topics 1. Growing our high quality, high value mortgage insurance portfolio to drive future earnings 2. Executing our strategy to further diversify our business 3. Leveraging our capital and financial flexibility to optimize shareholder returns 4. Driving a one company market view through our enterprise sales and marketing platform 5. Achieving operational excellence to drive further competitive differentiation and enhance operating leverage 6. How we are building competitive differentiation through our business model 7. Our positioning relative to the mortgage market transformation 8. Our progress to date and roadmap going forward 9

The projected mortgage market looks favorable for the MI industry 2011 – 2020 A sustainable growing purchase loan market. Source: MBA Mortgage Finance Forecast 10

Growing our MI portfolio through the next cycle As the market evolves towards the new cycle, we are well positioned. Grow Market New MI Disciplined Portfolio Leader Market Cycle Management Value     Disciplined risk We expect to Market leader, Origination management continue to delivering great market pivots  Risk and return drive organic, service and from refinances analytics high quality, competitively to a purchase  Customer high value priced products loan market  analytics growth in our First-time  Economic nearly homebuyers value driven $200 billion are an insurance in increasing % of force portfolio purchase loans We continually monitor the risk/return profile of NIW. 11

Diversifying our business through structured mortgage solutions We are leveraging our credit risk capabilities to address expanded market opportunities. Core Innovative Grow Market Need Competency Structures Earnings     Insurance Increased Leverage our Epic shift of  Reinsurance portfolio and experience, credit risk from  Securities fee-based market insights, government  Managed revenues risk analytics, and taxpayers  structures / Increased tools and to private vehicles operating transaction capital   Sponsorship leverage management Re-emergence through co- platforms of non-agency investment securities market Our capabilities match up very well with the market need for credit risk transfer. 12

Diversifying our business through our mortgage and real estate services We have a diversified set of market leading, highly relevant products and services. Current Enhancing Grow Products and Market Need Our Products Earnings Services     Product Increased fee- Mortgage and Integrated expansion based, capital real estate products across  Bundled light revenues transaction mortgage value  offerings Strong management, chain   Technology operating due diligence, Digitally enabled, data margins and portfolio enabled  driven Increased and securities products and  Opportunistic, operating surveillance services   highly accretive leverage Real estate Transaction M&A brokerage and quality and valuation transparency  Title and settlement The restructuring of our Services business is focused on services strategically repositioning our core products to align with the  REO asset market opportunities. management 13

Leveraging our capital and financial flexibility We continually evaluate market opportunities to improve earnings and returns. Strong Market Leverage Improve Capital Base Opportunities Market Tools Returns     Reinsurance Optimize use of Focus on Leverage third  FHLB financing our capital optimizing the party capital to   Off balance Grow earnings use of our improve our sheet financing by leveraging capital returns   Proprietary third-party Expand capital vehicles capital business   Capital partners Increased fee- opportunities based beyond our revenues capital structure  Increased operating leverage We plan to strategically and opportunistically leverage capital partners to drive our business growth and value for shareholders. 14

Achieving operational excellence We are implementing a disciplined approach to driving sustainable improvement. Develop Improve Grow Key Metrics Roadmaps Performance Earnings     Make Grow revenues Customer Targets  investments through service KPIs    Measure enhanced Operating Improvement results competitive quality plans   Align differentiation Productivity   accountability Improve Costs   Celebrate operating Employee successes performance satisfaction  Increase operating leverage Operational excellence is a strategic imperative. 15

Leveraging our enterprise sales and marketing model Our diversified product set uniquely positions us to become increasingly relevant to our customers. Team Diversified Grow Customers Structure Products Earnings     We have a Grow revenues Product Mortgage strong starting through greater specific teams insurance   point with over penetration of Enterprise level Structured 1,500 high our customer relationship mortgage value relationships managers solutions   customers Inside sales Mortgage and team real estate  Integrated products and marketing and services communication Our customers are confirming their desire to have a broader relationship. 16

Radian has an unparalleled portfolio of product and service offerings MI Appraisal Services Component Services Loan Review Solutions MI Real Estate Services Appraisal Services Rental Property Services Diverse Markets Risk Solutions Industry Advocacy Securitization Review Online Tools Surveillance Real Estate Services Title Services Risk Solutions Radian Title/Closing Services Group Training MI Appraisal Services Component Services Loan Review Solutions Appraisal Services Real Estate Services Online Tools Rental Property Services Real Estate Services REO Management Title/Closing Services Surveillance Training Title/Closing Underwriting Services 17

Our diversified product set positions us to be increasingly relevant For a typical Mortgage Insurance company, the relationship opportunity is limited. Typical MI Company Radian        Loan Lifecycle Loan Lifecycle For us, it’s just the beginning of the opportunity to work with a customer. 18

Our customers are beginning to realize they can rely on us for more than just MI Rental Property Services Loan Review Solutions Servicing Surveillance Title/Closing Services Securitization Review Component Services Real Estate Services Valuation Services REO Management Risk Solutions Underwriting Online Tools Training MI               Radian Other MI Companies      Competitive Differentiation 19

Why is our strategic plan important We are well positioned as the mortgage and real estate markets enter a transformative period. Our credit risk management expertise aligns well as the industry transitions to the epic shift from government to private capital. Diversification drives competitive differentiation and sustainable value for shareholders. 20

Repositioning the business We have been busy… Evolving the organization and team Integrating to One Company Restructuring Services business Launching Enterprise Sales platform Strengthening our Capital and Debt Structure Refining focus on core strengths 21