Fitch: MGIC and Radian unaffected

Fitch Ratings said it is taking no rating actions on MGIC Investment Corp. and its rated subsidiaries or the Radian Group Inc. and its rated subsidiaries following announcements by both companies related to their pending merger.

MGIC Investment said that it advised the New York Department of Insurance that management's preliminary assessment is that it is not obligated to complete a pending merger with Radian in light of previously disclosed impairments to both companies' investment in Credit-Based Asset Servicing and Securitization LLC.

Following MGIC Investment's press release, Radian said it believed that the impairments related to C-BASS do not affect MGIC Investment's obligation to go forward with the merger agreement, and it is Radian's intention to move ahead and complete the merger as soon as possible.

Based on the announcement by MGIC, Fitch said it believes the probability of the merger between the two companies being consummated is now lower than previously expected. Fitch placed the ratings of Radian and its insurance subsidiaries on Rating Watch negative on July 31.

MGIC has $200 million of 5 5/8% senior notes due Sept. 15, 2011 and $300 million of 5 3/8% senior notes due Nov. 1, 2015 both rated A. The outlook is stable.

Radian's ratings on Rating Watch negative are $250 million of 7¾% debentures due June 1, 2011, $250 million of 5 5/8% senior notes due Feb. 15, 2013 and $250 million of 5.325% senior notes due Feb. 15, 2015 all rated A.

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