Radian Group Inc, the biggest private U.S. mortgage insurer,posted a surprise quarterly adjusted profit, helped by a rise inpremium income, and said new business it wrote after the housingbust accounted for more than half of its portfolio.

A recovery in the U.S. housing sector has helped mortgageinsurers attract new and profitable business, giving them somerespite from the string of losses they have been posting since thehousing crisis in 2008.

“This improved composition has helped our mortgage insurancebusiness achieve profitability, absent the impact of fair valuegains and losses, for the quarter and six months,” Chief ExecutiveS.A. Ibrahim said in a statement.

Rival MGIC Investment Corp on Tuesday posted its first quarterlyprofit in three years and reported a drop in delinquencies.

Also Read: Mortgage Insurer MGIC Back in Profit as HousingRecovers

Radian said its new mortgage insurance business grew 60 percentin the quarter while its inventory of primary delinquent loans fell21 percent.

Radian's loss narrowed to $33.2 million, or 19 cents per share,in the second quarter from $119.3 million, or 90 cents per share, ayear earlier.

The mortgage insurer's results were hurt by net losses oninvestments of $130.3 million.

On an adjusted basis, the company earned 5 cents per share.Analysts on average had expected a loss of 5 cents per share,according to Thomson Reuters I/B/E/S.

The mortgage insurer has just posted one net profit in sevenquarters, highlighting the scale of losses the industry has bookedfollowing the housing market crash.

Net premiums earned rose 14 percent to $213.1 million.

Radian shares closed at $13.83 on Tuesday on the New York StockExchange. They have gained 19 percent this month, outperforming theS&P 500 Index, which is up more than 5 percent.