UPDATE 1-Radian's quarterly loss widens on higher derivatives losses

Wed May 1, 2013 7:55am EDT

* Net loss $187.5 mln vs $169.2 mln a year earlier

* 1st-qtr new mortgage insurance written $10.92 bln

* Provision for mortgage losses down

May 1 (Reuters) - Mortgage insurer Radian Group Inc quarterly loss widened due to higher losses from changes in the fair value of derivatives and other financial instruments.

Losses from derivative instruments almost doubled to $173.3 million for the first quarter from $90.6 million a year earlier.

Net loss widened to $187.5 million, or $1.30 per share, in the first quarter, from $169.2 million, or $1.28 per share, a year earlier.

The company has posted a profit only once in the last six quarters.

"As our strong new business volume continues, our delinquency inventory decreases and the mix of profitable new business begins to outweigh our legacy mortgage insurance book, we are positioning Radian for a return to operating profitability." Chief Executive S.A. Ibrahim said in a statement.

Radian Guaranty's risk-to-capital-ratio was 18.6-to-1 as of March 31. Most U.S. states allow a maximum ratio of 25-to-1, after which the insurer must seek waivers in individual states to continue writing insurance.

In March Radian raised about $700 million through a combination of stock offering and convertible senior notes that reduced concerns about its ability to pay mortgage insurance claims.

Radian set aside less money to cover mortgage insurance losses in the first quarter. Mortgage insurance provision for losses fell to $132.0 million from $234.7 million a year earlier.

New mortgage insurance written for the quarter rose to $10.9 billion, from $6.5 billion a year earlier, while total mortgage insurance claims paid rose more than 40 percent to $309.9 million.

Radian shares, which traded at more than $67 before the housing bubble burst in 2007, closed at $11.95 on the New York Stock Exchange on Tuesday.