Standard & Poor’s ‘B’ rating on Radian (RDN) remains unaffected by the mortgage insurer’s announcement that it will issue a tender offer to repurchase outstanding debt that matures in 2013.
The insurer posted a loss of $121.5 million, or 92 cents a share, in the fourth quarter, which is improved from the company’s loss of $1.1 billion a year earlier.
While S&P is keeping the insurer’s ratings the same, the ratings giant said Radian’s 2011 operating performance failed to meet S&P’s expectations, and the insurer’s loan delinquency inventory remains high despite some improvements last year.
“We remain concerned with the potential for adverse reserve development if macroeconomic conditions remain weak,” S&P said. “However, the current ratings contemplate continued losses through 2012 with a trajectory toward break-even operating results by the end of 2013 due to improving notice of delinquencies trends.”
