Radian Group Inc.

Good day and thank you for standing by. Welcome to the first quarter 2022 Radian Group earnings conference call. At this time, all participants are in listen only mode. After the presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star then one on your telephone keypad. Please be advised today's conference may be recorded. If you require operator assistance during the call, please press star then zero. I'd now like to hand the conference over to John Damian, Senior Vice President, Investor Relations and Corporate Development.

Thank you, and welcome to Radian's first quarter 2022 conference call. Our press release, which contains Radian's financial results for the quarter, was issued yesterday evening and is posted to the investor section of our website at www.radian.com. This press release includes certain non-GATT measures that will be discussed during today's call, including adjusted pre-tax operating income, adjusted diluted net operating income per share, and adjusted net operating return on equity. In addition, specifically for our home genius segment, other non-GATT measures that will be discussed today include include adjusted gross profit, adjusted pre-tax operating income or loss before allocated corporate operating expenses, and the related home genius profit margins. A complete description of all of our non-GAAP measures may be found in press release Exhibit F, and reconciliations of these measures to the most comparable GAAP measures may be found in press release Exhibit G. These exhibits are on the investor section of our website. This morning, you will hear from Rick Thornberry, Radian's Chief Executive Officer, and Frank Hall, Chief Financial Officer. Also on hand for the Q&A portion of the call is Derek Brummer, President of Radian Mortgage. Before we begin, I would like to remind you that comments made during this call will include forward-looking statements. These statements are based on current expectations, estimates, projections, and assumptions that are subject to risks and uncertainties which may cause actual results that differ materially. For discussion of these risks, please review the cautionary statements regarding forward-looking statements included in our earnings release and the risk factors included in our 2021 Forum 10-K and subsequent reports filed with the SEC. These are also available on our website. Now, I would like to turn the call over to Rick.

Thank you, John. And good morning. Thank you all for joining us today and for your interest in Radian. This morning, I'm pleased to report a strong start to the year. Our team remains focused across our three areas of strategic value creation, growing the economic value and the future earnings of our mortgage insurance portfolio, growing our home genius business, and managing our capital resources. Before we start, I want to highlight that 2022 marks our 45th year in business. and our 30th year as a publicly traded company. We are proud of our history of ensuring affordable, sustainable, and equitable homeownership for so many years and are even more excited about the promise of our future. Frank will discuss the details of our financial position shortly, but let me share a few highlights from the quarter. We reported net income of $181 million, or $1.01 per share. Adjusted diluted net operating income was $1.17 per diluted share. Return on equity was 17.2%, an increase from 11.8% reported a year ago. Frank will discuss the favorable prior period reserve development, which was largely driven by better than expected cure activity. We grew our book value per share by more than 7% year over year, or 14%, after adjusting for the impact of accumulated other comprehensive income, which Frank will discuss in more detail shortly. We also returned $116 million of dividends to stockholders over the past year. In our mortgage segment, we wrote $18.7 billion of NIW in the first quarter. We are continuing to see a higher mix of purchase business with a 43% increase in purchase volume year-over-year. And as I mentioned last quarter, we typically deploy more capital in a purchase-driven market and expect the environment in 2022 to continue to provide strong opportunities to put our capital to work at attractive risk-adjusted returns. We believe our ability to leverage the strength of our proprietary analytics and radar reach platform, utilizing artificial intelligence and machine learning, has been and continues to be a differentiator for Radiant in terms of optimizing economic value across a competitive marketplace. Our primary insurance in-force, which is the main driver of future earnings for our company, grew more than 4% year-over-year to nearly $249 billion at March 31, 2022. Our monthly premium in-force portfolio grew more than 10% year-over-year, while our single premium in-force portfolio declined 19%. Additionally, nearly 70% of our mortgage insurance portfolios comprise of business written since 2020 at historically low interest rates. We are pleased with the positive credit trends that we are seeing in our defaulted loan portfolio. The total number of loans in default declined by 49% year-over-year. We've seen a sharp increase in cures over the past year for loans in forbearance programs, particularly among the population that has missed 12 payments or more. As we have noted previously, CURES have outpaced new defaults each period beginning in the third quarter of 2020. For those borrowers who remain in default, we are actively monitoring and communicating with servicers and supporting efforts by the GSEs to effectively navigate a successful resolution. For our home genius segment, total revenues for the quarter were $33.9 million, a 31% increase compared to the first quarter of 2021. In the first quarter, we saw increased revenue and strong performance from our real estate services, specifically our single-family rental business and our valuation products and services. We saw a decline in volume from our centralized lender refinance title business due to a significant industry-wide decline in mortgage refinance activity from the fourth quarter of 2021. Although we and other mortgage industry participants expected the decline and refinances to occur, the rise in rates during the first quarter alone was more rapid than expected, and industry forecasts now anticipate a more significant slowdown in total refinance activity for the year versus the original 2022 projections. Despite this decrease in overall volume, we remain well-positioned with our current customers to continue growing our share in this market while also attracting new centralized lender customers. We continue to develop our innovative direct purchase title business leveraging our award-winning title genius technology platform. And although volumes are small, we are encouraged by the traction we are gaining with home buyers, real estate agents, lenders, and investors. In terms of our technology products, we are pleased with the customer response to our software as a service solutions for real estate agents, specifically Genius Price, an innovative property intelligence technology platform offered by our RedBell real estate brokerage. Over the last couple of months, we've signed Genius Price contracts with real estate brokers, as well as marketing partnerships with large real estate franchise companies. These relationships provide us with sponsored access to market and deliver our Genius Price SaaS solution to more than 200,000 real estate agents across the country. Additionally, I'm proud to highlight that in March, HomeGenius was named the 2022 Tech 100 Real Estate winner by HousingWire. The award recognizes the most innovative technology companies in our industries, and we were honored to be chosen for our Genius Price technology and our digital purchase title platform, TitleGenius, which leverages patent-pending blockchain technologies. Frank will provide additional details on our HomeGenius financial results and an update on our expectations for this business. Turning now to our capital and liquidity, at March 31st, Radian Group maintained a strong capital position with $1.3 billion of total holding company liquidity. At March 31st, Radian guarantees available assets under PLR's total approximately $5.1 billion, resulting in a cushion of $1.6 billion, or 44%. Frank will update on our capital actions during the quarter. Moving now to the broader mortgage and real estate market, we are closely monitoring the impact from inflation and the rise in interest rates on the mortgage and housing markets, as well as our businesses. Despite current inflationary pressure, rising interest rates, and steady home price appreciation, the strong demand for housing continues. This is fueled largely by the constrained supply of homes available for sale and demand from first-time homebuyers who are most likely to use private MI. In terms of the overall housing market, we saw positive momentum continuing in the first quarter with purchase originations increasing 11% year-over-year. Based on the latest data from our own rating home price index, over the first three months of 2022, continued strong housing demand and relatively limited supply in the markets led to an annualized 13% increase in home prices across the country. We expect the rate of home price appreciation to moderate this year, and we believe the combination of low unemployment and positive housing market dynamics in terms of low supply and strong demand will support a strong and stable national housing market in 2022. The increase in mortgage interest rates is expected to drive higher persistency on our existing in-force portfolio and in turn contribute to growth in our large high quality insurance and force portfolio. Additionally, the increase in interest rates is likely to result in higher reinvestment yields in our investment portfolio. Based on the most recent origination projections for 2022, we expect the private mortgage insurance market to be approximately $500 to $525 billion, which would represent the third largest MI volume year in history. And finally, while we are extremely proud of our success over the years in ensuring the American dream of homeownership, we know we are in a unique position to do even more. That's why we launched an affordable homeownership initiative within Radiant to further address access to affordable, sustainable, and equitable homeownership, with a particular focus on closing the homeownership gap for underserved communities. Our initiative builds upon our industry and trade association partnerships, our research and analytics capability, our unique expertise across the mortgage and real estate ecosystem, and our extensive training and education platforms. We believe we can play an important role in extending the homeownership opportunity to even more deserving families and look forward to reporting on our progress. Now I'd like to turn the call over to Frank for details of our financial positions.