Radian Adds Default Protection on MBIA to Hedge Loan Risk
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Radian Group Inc. bought $100 million of default protection on an MBIA Inc. unit to help hedge against losses on a collateralized loan obligation backed by the two insurers.
Radian is the second insurer, behind MBIA Insurance Corp., on a guarantee of about $377 million on a CLO called Zohar that’s backed by loans to smaller companies. Radian purchased half of the protection in August 2013 and the rest in June, Chief Risk Officer Derek Brummer said today in an interview, after his Philadelphia-based firm disclosed the hedge on a conference call with analysts.