Market leaders report combined 2007 losses of $4bn

Both MBIA and Radian Group say it will be difficult to shake off the challenges of the current environment

The two leading mortgage insurers in the US – Milwaukee-based MGIC Investment Corporation and Philadelphia-based Radian Group – posted combined pre-tax losses of $4.2bn last year as the subprime crisis forced the firms to sharply increase their loss reserves. At the same time both companies, which called off their proposed merger last year due to the difficult market conditions, were hurt by securities losses and costly write-downs.