(1) Effective June 9, 1999, Radian Group Inc. was formed by the merger of CMAC Investment Corporation and Amerin Corporation pursuant to an Agreement and Plan of Merger dated November 22, 1998. The transaction was accounted for on a pooling of interests basis and, therefore, all financial statements presented reflect the combined entity. On February 28, 2001, the Company acquired Enhance Financial Services Group Inc. The results for 2001 include the results of operations for Enhance Financial Services Group Inc. from the date of acquisition. See note 1 of Notes to Consolidated Financial Statements set forth on page 20 herein. (2) Diluted net income per share and average share information per Statement of Financial Accounting Standards No. 128, “Earnings Per Share.” See note 1 of Notes to Consolidated Financial Statements set forth on page 20 herein. (3) All share and per-share data for prior periods have been restated to reflect a 2-for-1 stock split in 2001. (4) Expense ratio in 1999 calculated net of merger expenses of $21.8 million recognized by statutory companies. >15 (in millions, except per-share amounts and ratios) 2001 2000 1999 1998 1997 CONDENSED CONSOLIDATED STATEMENTS OF INCOME Net premiums written $ 783.6 $ 544.3 $ 451.8 $ 406.5 $ 327.8 Net premiums earned 715.9 520.9 472.6 405.3 330.0 Net investment income 147.5 82.9 67.3 59.9 52.4 Equity in net income of affiliates 41.3 — — — — Other income 42.5 7.4 11.3 15.3 5.6 Total revenues 947.2 611.3 551.2 480.4 388.0 Provision for losses 208.1 154.3 174.1 166.4 147.4 Policy acquisition costs and other operating expenses 216.8 108.6 121.4 118.2 83.4 Merger expenses — — 37.8 1.1 — Net gains 1.0 4.2 1.6 3.2 2.0 Pretax income 505.5 352.5 219.5 197.9 159.2 Net income 360.4 248.9 148.1 142.2 115.7 Net income per share (2) (3) $ 3.88 $ 3.22 $ 1.91 $ 1.84 $ 1.50 Average shares outstanding (2) (3) 92.0 76.3 75.7 75.6 75.1 CONDENSED CONSOLIDATED BALANCE SHEETS Assets $ 4,438.6 $ 2,272.8 $ 1,776.7 $ 1,513.4 $ 1,222.7 Investments 3,369.5 1,750.5 1,388.7 1,175.5 974.7 Unearned premiums 513.9 77.2 54.9 75.5 72.7 Reserve for losses and loss adjustment expenses 588.6 390.0 335.6 245.1 179.9 Long-term debt 324.1 — — — — Redeemable preferred stock 40.0 40.0 40.0 40.0 40.0 Common stockholders’ equity 2,306.3 1,362.2 1,057.3 932.2 780.1 Book value per share (3) 24.54 17.97 14.17 12.65 10.69 STATUTORYRATIOS – MORTGAGE INSURANCE Loss ratio 30.2% 30.5% 37.6% 42.0% 46.1% Expense ratio (4) 20.4 17.9 24.2 24.6 22.5 Combined ratio 50.6% 48.4% 61.8% 66.6% 68.6% SELECTED RATIOS – FINANCIAL GUARANTY Loss ratio 27.2% — — — — Expense ratio 40.8 — — — — Combined ratio 68.0% OTHER DATA – MORTGAGE INSURANCE New primary insurance written $ 44,754 $ 24,934 $ 33,256 $ 37,067 $ 21,481 Direct primary insurance in force 107,918 100,859 97,089 83,178 67,294 Direct primary risk in force 26,004 24,622 22,901 19,840 15,158 Direct pool risk in force 1,571 1,388 1,361 933 601 Other risk in force 348 211 — — — OTHER DATA – FINANCIAL GUARANTY Net premiums written $ 143.2 — — — — Net premiums earned 106.5 — — — — Net debt service outstanding 97,939.7 — — — — SELECTED FINANCIAL AND STATISTICAL DATA