NU Online News Service, Sept. 27, 11:11 a.m. EDT

Radian Group Inc. and the National League of Cities (NLC) say they are exploring the formation of a new public-finance mutual bond insurance company.

The agreement involves the NLC and Radian's financial guaranty subsidiary, Radian Asset Assurance Inc. Radian and NLC say they are still working on the details of the structure, but they anticipate it will involve the support of private capital from third-party investors.

NLC, a non-profit association of cities and state municipal leagues, says it began to pursue the creation of the first-ever mutual bond insurance company in response to the need for expanded capacity in the bond insurance industry.

David Beidler, president of Radian Asset Assurance, says, “A mutual bond insurance company with a public finance book of business would restore capacity that was lost in recent years. More importantly, the mutual insurance company structure, with the issuers as members, offers assurance to bondholders that the company will not deviate from its public-finance mission.”

NLC Executive Director David J. Borut says, “Radian is an established and experienced bond insurer that has the resources, people, infrastructure, transparency, and vision to help NLC, its members, and the thousands of local governmental issuers that access the municipal bond market each year.”

Special Reports /

Radian, NLC Look to Form Public-Finance Mutual Bond Insurer

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