WINSTON-SALEM, N.C., Aug 04, 2008 /PRNewswire-FirstCall via COMTEX/ ----Triad Guaranty Inc. (Nasdaq: TGIC) today reported a net loss for the quarter ended June 30, 2008 of $198.8 million compared with net income of $12.0 million for the same quarter in 2007. The loss per share was $13.36 for the second quarter of 2008 compared to diluted earnings per share of $0.80 for the second quarter of 2007. The net loss for the six months ended June 30, 2008 was $348.8 million compared to net income of $29.3 million for the same period in 2007. The loss per share was $23.45 for the first six months of 2008 compared to diluted earnings per share of $1.96 for the same period last year.

William T. Ratliff, III, Chairman and CEO, said, "As I take on this additional leadership role, Triad and the entire mortgage industry are facing significant challenges. During the second quarter we announced that Triad was going into run-off and we stopped issuing commitments for new mortgage insurance coverage effective July 15, 2008. Concurrent with the move to run-off, we took actions to reduce our workforce by approximately 45%. Our focus now is on the efficient and effective servicing of our insured portfolio, particularly around loss mitigation. We intend to continue to improve our processes in this area by examining and refining all aspects of our default management and claims process, including assessing servicer effectiveness, pursuing acquisitions of properties in foreclosure when appropriate and enhancing our investigations of potential fraud in the mortgage commitment process, particularly for recent policy years."

Mr. Ratliff continued, "The size of our second quarter loss reflects the depth and breadth of the collapse of the housing and mortgage markets. The continued growth in the number of defaults and foreclosures during the quarter required a significant increase in reserves. The distressed markets of California, Florida, Arizona and Nevada continue to be adversely impacted by declining home prices, and reserves for defaults in these states comprised approximately 68% of the increase in our reserves for the quarter."

To understand and assess the future performance of Triad requires information about the risk in our insured portfolio and performance to date. In our continuing effort to provide meaningful information, we have updated the supplemental information for the 2008 second quarter results related to product differentiation, risk structures, additional portfolio characteristics and performance on our web site at www.triadguaranty.com. The supplemental information can be found under "Investors" and then under "Webcasts and Presentations" by the title "Supplemental Information - Second Quarter 2008".

(Relevant Triad Guaranty Inc. financial and statistical information follows)

Triad Guaranty Inc.'s wholly owned subsidiary, Triad Guaranty Insurance Corporation, is a nationwide mortgage insurer pursuing a voluntary run-off of its existing in-force book of business. For more information, please visit the Company's web site at www.triadguaranty.com.

Diluted realized investment gains (losses) per share, net of taxes, is a non-GAAP financial measure. The Company believes this is relevant and useful information to investors because, except for losses on impaired securities, it shows the effect that the Company's discretionary sale of investments had on earnings.

Certain of the statements contained in this release are "forward-looking statements" and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements include estimates and assumptions related to economic, competitive, regulatory, operational and legislative developments. These forward-looking statements are subject to change, uncertainty and circumstances that are, in many instances, beyond our control and they have been made based upon our current expectations and beliefs concerning future developments and their potential effect on us. Actual developments and their results could differ materially from those expected by us, depending on the outcome of a number of factors, including our ability to transition our business into run-off, the possibility of general economic and business conditions that are different than anticipated, legislative, regulatory, and other similar developments, changes in interest rates, the housing market, the mortgage industry and the stock market, as well as the factors described under "Risk Factors" and under "Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995" in our Annual Report on Form 10-K for the year ended December 31, 2007 and in other reports and statements that we file with the Securities and Exchange Commission. Forward-looking statements are based upon our current expectations and beliefs concerning future events and we undertake no obligation to update or revise any forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements are made.

 Triad Guaranty Inc. Consolidated Statement of Operations (Unaudited) Three Months Ended Six
   Months Ended June 30, June 30, 2008 2007 2008 2007 (Dollars in thousands except per share amounts) Premiums written: Direct
   $84,560 $83,153 $173,946 $161,561 Ceded (15,480) (12,988) (31,475) (25,689) Net premiums written $69,080 $70,165 $142,471
   $135,872 Earned premiums $69,864 $69,732 $141,929 $133,680 Net investment income 9,175 7,673 18,722 15,022 Net realized investment
   losses (3,799) (3,867) (1,096) (3,105) Other income 2 2 4 4 Total revenues 75,242 73,540 159,559 145,601 Net losses and loss
   adjustment expenses 292,749 41,893 514,008 74,474 Net change in premium deficiency reserve (15,000) - - - Interest expense
   on debt 696 694 2,172 1,387 Policy acquisition costs - 4,670 39,416 9,293 Other operating expenses - net 27,238 10,716 41,344
   21,047 (Loss) income before income taxes (230,441) 15,567 (437,381) 39,400 Income taxes (benefit) (31,630) 3,541 (88,556)
   10,051 Net (loss) income $(198,811) $12,026 $(348,825) $29,349 Basic (loss) earnings per share $(13.36) $0.81 $(23.45) $1.98
   Diluted (loss) earnings per share $(13.36) $0.80 $(23.45) $1.96 Weighted average common and common stock equivalents outstanding
   (in thousands) Basic 14,879 14,835 14,874 14,824 Diluted 14,879 14,951 14,874 14,946 CERTAIN NON-GAAP FINANCIAL MEASURES:
   Diluted earnings (losses) per share contribution from realized losses Net realized investment losses $(3,799) $(3,866) $(1,096)
   $(3,105) Income tax benefit at 35% (1,330) (1,353) (384) (1,087) After tax realized losses $(2,469) $(2,513) $(712) $(2,018)
   Diluted weighted average shares outstanding (in thousands) 14,879 14,951 14,874 14,946 Diluted earnings (losses) per share
   contribution from realized losses $(0.16) $(0.17) $(0.05) $(0.14) Diluted realized investment losses per share, net of taxes
   is a non-GAAP financial measure. We believe this is relevant and useful information to investors because, except for losses
   on impaired securities, it shows the effect that the Company's discretionary sale of investments had on earnings. Triad Guaranty
   Inc. Consolidated Balance Sheet (Unaudited) (Unaudited) June 30, December 31, June 30, 2008 2007 2007 (Dollars in thousands
   except per share amounts) Assets: Invested assets: Fixed maturities, available for sale, at market $843,951 $725,631 $618,034
   Equity securities, available for sale, at market 1,749 2,162 3,781 Short-term investments 23,322 56,746 52,384 869,022 784,539
   674,199 Cash and cash equivalents 19,669 124,811 26,711 Deferred policy acquisition costs - 36,243 35,157 Prepaid federal
   income tax 63,184 116,008 170,076 Reinsurance recoverable 55,316 - - Other assets 56,607 71,252 54,134 Total assets $1,063,798
   $1,132,853 $960,277 Liabilities: Losses and loss adjustment expenses $817,262 $359,939 $122,061 Premium deficiency reserve
   - - - Unearned premiums 18,360 17,793 15,461 Revolving line of credit - 80,000 - Deferred income tax 30,386 123,297 177,889
   Long-term debt 34,527 34,519 34,514 Other liabilities 22,354 18,454 15,729 Total liabilities 922,889 634,002 365,654 Stockholders'
   equity: Retained earnings 26,793 375,618 482,426 Accumulated other comprehensive income 2,585 13,405 4,507 Other equity accounts
   111,531 109,828 107,690 Total stockholders' equity 140,909 498,851 594,623 Total liabilities and stockholders' equity $1,063,798
   $1,132,853 $960,277 Stockholders' equity per share: $9.32 $33.43 $39.85 Common shares outstanding 15,116,259 14,920,243 14,920,108
   Triad Guaranty Inc. Consolidated Statement of Cash Flow (Unaudited) For the Six Months Ended June 30, 2008 2007 OPERATING
   ACTIVITIES Net income (loss) $(348,825) $29,349 Adjustments to reconcile net income (loss) to net cash provided by operating
   activities: Increase in loss and unearned premium reserves 457,890 39,977 Decrease (increase) in amounts due to/from reinsurer
   (56,026) 1,202 Net realized investment losses 1,096 3,105 Policy acquisition costs deferred (3,173) (9,307) Amortization of
   policy acquisition costs 39,416 9,293 Increase (decrease) in deferred income taxes (88,554) 6,526 Redemption (purchases) of
   Tax and Loss Bonds 52,824 (3,168) Other operating activities 23,565 (3,331) Net cash provided by operating activities 78,213
   73,646 INVESTING ACTIVITIES Purchases of investment securities (584,572) (128,425) Sales and maturities of investment securities
   450,706 90,597 Decrease (increase) in short-term investments 31,655 (47,083) Other investing activities (1,080) (3,404) Net
   cash used in investing activities (103,291) (88,315) FINANCING ACTIVITIES Borrowings (repayments) on credit facility (80,000)
   - Excess tax benefits related to share based compensation - 175 Proceeds from exercise of stock options - 616 Net cash provided
   by (used in) financing activities (80,000) 791 Foreign currency translation adjustment (64) 1,980 Net decrease in cash (105,142)
   (11,898) Cash at beginning of period 124,811 38,609 Cash at end of period $19,669 $26,711 Triad Guaranty Inc. Sequential Quarterly
   Statistical Information (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 (Dollars in millions
   unless otherwise indicated) Insurance In Force Primary insurance in force: - Flow business $41,645 $42,086 $41,840 $40,610
   $38,590 - Structured bulk transactions 4,248 4,374 4,525 4,700 4,133 Total Primary insurance in force 45,894 46,459 46,365
   45,310 42,724 Modified Pool insurance in force 20,439 21,187 21,863 22,737 23,649 Total insurance in force $66,333 $67,646
   $68,228 $68,047 $66,373 Number of insured loans: - Primary 267,689 272,289 273,798 269,681 258,163 - Modified Pool 97,960
   101,723 105,109 109,133 113,725 Total number of insured loans 365,649 374,012 378,907 378,814 371,888 Average loan size: ($
   in thousands) - Primary $171.4 $170.6 $169.3 $168.0 $165.5 - Modified Pool $208.6 $208.3 $208.0 $208.3 $208.0 Credit quality
   of Primary insurance in force(1) Prime 76.9% 76.5% 75.8% 74.9% 74.8% Alt-A 19.6% 19.9% 20.5% 21.4% 21.5% A Minus 3.1% 3.1%
   3.2% 3.2% 3.2% Sub Prime 0.5% 0.5% 0.5% 0.5% 0.6% Primary Alt-A insurance in force by credit score: FICO between 620 and 659
   7.4% 7.5% 7.6% 7.7% 8.3% FICO between 660 and 699 29.2% 29.2% 29.1% 29.3% 29.8% FICO between 700 and 739 35.5% 35.4% 35.4%
   35.1% 34.4% FICO greater than 739 28.0% 27.9% 28.0% 27.9% 27.5% Primary flow insurance in force subject to captive reinsurance
   arrangements 57.9% 58.8% 59.0% 58.0% 56.8% Primary annual persistency rate 85.1% 83.3% 81.4% 79.1% 77.7% Mar 31, Dec 31, Sep
   30, Jun 30, 2007 2006 2006 2006 (Dollars in millions unless otherwise indicated) Insurance In Force Primary insurance in force:
   - Flow business $35,366 $32,779 $31,012 $30,064 - Structured bulk transactions 2,616 1,330 1,094 719 Total Primary insurance
   in force 37,982 34,109 32,106 30,783 Modified Pool insurance in force 23,507 22,719 21,779 20,022 Total insurance in force
   $61,489 $56,828 $53,885 $50,804 Number of insured loans: - Primary 239,326 225,531 219,287 216,458 - Modified Pool 114,711
   112,555 110,650 107,653 Total number of insured loans 354,037 338,086 329,937 324,111 Average loan size: ($ in thousands)
   - Primary $158.7 $151.2 $146.4 $142.2 - Modified Pool $204.9 $201.9 $196.8 $186.0 Credit quality of Primary insurance in force(1)
   Prime 77.1% 80.4% 81.5% 82.9% Alt-A 19.1% 15.4% 14.1% 12.3% A Minus 3.2% 3.5% 3.6% 3.9% Sub Prime 0.6% 0.7% 0.8% 0.9% Primary
   Alt-A insurance in force by credit score: FICO between 620 and 659 8.9% 10.1% 11.6% 14.4% FICO between 660 and 699 30.9% 32.5%
   33.9% 34.4% FICO between 700 and 739 33.7% 31.9% 30.3% 28.2% FICO greater than 739 26.5% 25.5% 24.2% 22.9% Primary flow insurance
   in force subject to captive reinsurance arrangements 57.9% 61.0% 63.0% 62.7% Primary annual persistency rate 77.0% 76.6% 75.3%
   72.7% (1) The credit quality of loans notated above are defined as follows: Prime - All business that is not Alt-A, A Minus,
   or Sub Prime; Alt A - Loans with credit scores >= 620 and that were underwritten with low or no documentation; A Minus
   - Loans with credit scores >= 575 and <= 619; Sub-Prime - Loans with credit scores < 575 Triad Guaranty Inc. Sequential
   Quarterly Statistical Information (con't.) (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 (Dollars
   in millions unless otherwise indicated) Risk in Force - Primary Primary net risk in force: - Flow business $9,524 $9,671 $9,642
   $9,350 $8,866 - Structured bulk business 1,425 1,470 1,525 1,583 1,373 Total Primary net risk in force $10,949 $11,141 $11,166
   $10,933 $10,239 Primary risk in force by credit score FICO less than 575 0.4% 0.4% 0.5% 0.5% 0.5% FICO between 575 and 619
   3.0% 3.1% 3.1% 3.2% 3.2% FICO between 620 and 659 15.4% 15.5% 15.6% 15.6% 15.6% FICO between 660 and 699 25.0% 25.0% 24.9%
   24.9% 24.9% FICO between 700 and 739 26.4% 26.4% 26.4% 26.4% 26.2% FICO greater than 739 29.8% 29.6% 29.5% 29.4% 29.5% Primary
   risk in force by policy year 2001 and prior 2.2% 2.3% 2.5% 2.7% 3.0% 2002 2.7% 2.8% 3.0% 3.3% 3.7% 2003 8.8% 9.2% 9.6% 10.3%
   11.7% 2004 8.5% 8.8% 9.2% 10.0% 11.3% 2005 12.6% 12.9% 13.5% 14.4% 16.2% 2006 21.2% 21.6% 22.4% 23.6% 26.0% 2007 38.9% 39.3%
   39.8% 35.8% 28.0% 2008 5.2% 3.1% - - - Primary risk in force by loan type: - Fixed 66.1% 65.6% 64.7% 63.5% 62.6% - Interest
   Only 10.4% 10.6% 10.7% 11.0% 9.6% - ARM (amortizing) Fixed Period 5 Years or Greater 8.8% 9.1% 9.4% 10.3% 11.0% - ARM (amortizing)
   Fixed Period Less than 5 Years 2.2% 2.3% 2.4% 2.3% 2.7% - ARM (potential negative amortization) 12.4% 12.5% 12.8% 13.0% 14.0%
   Primary risk in force by property type: - Condominium 10.6% 10.5% 10.4% 10.4% 10.3% - Other (principally single- family detached)
   89.4% 89.5% 89.6% 89.6% 89.7% Primary risk in force by occupancy status: - Primary residence 87.7% 87.7% 87.7% 87.7% 87.7%
   - Second home 7.9% 7.9% 7.9% 7.9% 7.9% - Non-owner occupied 4.4% 4.4% 4.4% 4.5% 4.5% Primary risk in force by mortgage amount:
   - $200,000 or less 47.2% 47.5% 48.0% 48.6% 49.8% - Greater than $200,000 52.8% 52.5% 52.0% 51.4% 50.2% Mar 31, Dec 31, Sep
   30, Jun 30, 2007 2006 2006 2006 (Dollars in millions unless otherwise indicated) Risk in Force - Primary Primary net risk
   in force: - Flow business $8,094 $7,447 $7,016 $6,781 - Structured bulk business 843 377 305 185 Total Primary net risk in
   force $8,937 $7,824 $7,321 $6,966 Primary risk in force by credit score FICO less than 575 0.5% 0.6% 0.7% 0.7% FICO between
   575 and 619 3.2% 3.6% 3.7% 3.9% FICO between 620 and 659 15.9% 16.4% 16.7% 17.3% FICO between 660 and 699 24.7% 24.5% 24.5%
   24.5% FICO between 700 and 739 25.9% 25.2% 24.7% 24.2% FICO greater than 739 29.8% 29.7% 29.8% 29.3% Primary risk in force
   by policy year 2001 and prior 3.7% 4.4% 5.0% 5.7% 2002 4.6% 5.5% 6.3% 7.1% 2003 14.3% 17.1% 19.4% 22.0% 2004 13.9% 16.8% 19.3%
   21.9% 2005 19.6% 23.4% 26.3% 29.1% 2006 30.5% 32.8% 23.7% 14.2% 2007 13.5% - - - 2008 - - - - Primary risk in force by loan
   type: - Fixed 64.4% 68.9% 70.2% 72.0% - Interest Only 7.4% 5.9% 5.0% 3.6% - ARM (amortizing) Fixed Period 5 Years or Greater
   11.0% 9.4% 10.0% 10.7% - ARM (amortizing) Fixed Period Less than 5 Years 3.6% 4.5% 5.4% 6.3% - ARM (potential negative amortization)
   13.6% 11.3% 9.4% 7.4% Primary risk in force by property type: - Condominium 10.1% 9.6% 9.2% 8.7% - Other (principally single-family
   detached) 89.9% 90.4% 90.8% 91.3% Primary risk in force by occupancy status: - Primary residence 88.1% 89.4% 89.6% 90.3% -
   Second home 7.7% 7.4% 7.0% 6.2% - Non-owner occupied 4.2% 3.2% 3.3% 3.4% Primary risk in force by mortgage amount: - $200,000
   or less 53.5% 57.9% 60.8% 63.8% - Greater than $200,000 46.5% 42.1% 39.2% 36.2% Triad Guaranty Inc. Sequential Quarterly Statistical
   Information (con't.) (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 (Dollars in millions unless
   otherwise indicated) Risk in Force - Modified Pool Modified Pool risk in force net of stop loss $875 $903 $913 $922 $935 Deductibles
   on modified pool risk $103 $108 $112 $115 $117 Modified Pool risk in force by credit score(2): FICO less than 575 0.1% 0.1%
   0.1% 0.1% 0.1% FICO between 575 and 619 0.7% 0.7% 0.7% 0.7% 0.7% FICO between 620 and 659 10.7% 10.7% 10.7% 10.7% 10.8% FICO
   between 660 and 699 31.4% 31.3% 31.3% 31.3% 31.3% FICO between 700 and 739 30.0% 29.9% 29.9% 29.9% 29.8% FICO greater than
   739 27.1% 27.3% 27.3% 27.3% 27.3% Modified Pool risk in force by policy year 2001 and prior 2.2% 2.3% 2.4% 2.5% 2.6% 2002
   2.5% 2.6% 2.8% 3.0% 3.1% 2003 14.0% 13.9% 14.0% 14.5% 14.5% 2004 16.4% 16.0% 16.3% 16.2% 16.1% 2005 27.5% 27.7% 29.9% 28.7%
   29.1% 2006 33.3% 33.7% 30.9% 31.3% 31.1% 2007 4.1% 3.9% 3.8% 3.7% 3.5% Modified Pool risk in force by loan type(2): - Fixed
   26.2% 26.1% 26.2% 26.8% 26.8% - Interest Only 23.3% 23.4% 23.3% 23.0% 22.9% - ARM (amortizing) Fixed Period 5 Years or Greater
   31.4% 31.5% 31.4% 33.7% 33.6% - ARM (amortizing) Fixed Period Less than 5 Years 5.7% 5.8% 6.1% 4.0% 4.1% - ARM (potential
   negative amortization) 13.5% 13.2% 13.0% 12.6% 12.5% Modified Pool risk in force by property type(2): - Condominium 9.5% 9.5%
   9.4% 9.3% 9.3% - Other (principally single-family detached) 90.5% 90.5% 90.6% 90.7% 90.7% Modified Pool risk in force by occupancy
   status(2): - Primary residence 73.4% 73.5% 73.6% 73.6% 73.7% - Second home 6.1% 6.2% 6.2% 6.2% 6.2% - Non-owner occupied 20.4%
   20.4% 20.3% 20.2% 20.1% Modified Pool risk in force by mortgage amount(2): - $200,000 or less 35.2% 35.4% 35.5% 35.5% 35.7%
   - Greater than $200,000 64.8% 64.6% 64.5% 64.5% 64.3% Mar 31, Dec 31, Sep 30, Jun 30, 2007 2006 2006 2006 Risk in Force -
   Modified Pool Modified Pool risk in force net of stop loss $933 $890 $837 $764 Deductibles on modified pool risk $114 $101
   $94 $90 Modified Pool risk in force by credit score(2): FICO less than 575 0.1% 0.2% 0.2% 0.2% FICO between 575 and 619 0.7%
   0.8% 0.9% 1.0% FICO between 620 and 659 10.9% 11.3% 11.6% 12.0% FICO between 660 and 699 31.3% 31.0% 30.6% 30.2% FICO between
   700 and 739 29.8% 29.4% 29.4% 29.5% FICO greater than 739 27.2% 27.3% 27.3% 27.1% Modified Pool risk in force by policy year
   2001 and prior 2.8% 3.1% 3.7% 4.3% 2002 3.4% 3.7% 4.3% 5.2% 2003 14.7% 15.4% 16.4% 18.1% 2004 16.0% 16.6% 17.6% 19.5% 2005
   29.2% 30.4% 32.3% 35.6% 2006 29.9% 30.8% 25.7% 17.3% 2007 4.0% - - - Modified Pool risk in force by loan type(2): - Fixed
   28.1% 30.8% 31.8% 35.0% - Interest Only 23.0% 24.5% 26.4% 28.8% - ARM (amortizing) Fixed Period 5 Years or Greater 32.5% 27.2%
   25.2% 24.8% - ARM (amortizing) Fixed Period Less than 5 Years 4.3% 4.5% 5.0% 5.7% - ARM (potential negative amortization)
   12.0% 13.1% 11.6% 5.7% Modified Pool risk in force by property type(2): - Condominium 8.9% 8.0% 7.3% 7.2% - Other (principally
   single-family detached) 91.1% 92.0% 92.7% 92.8% Modified Pool risk in force by occupancy status(2): - Primary residence 73.8%
   73.7% 73.7% 73.9% - Second home 6.1% 6.2% 6.0% 5.9% - Non-owner occupied 20.1% 20.1% 20.3% 20.1% Modified Pool risk in force
   by mortgage amount(2): - $200,000 or less 36.5% 37.8% 39.1% 41.4% - Greater than $200,000 63.5% 62.2% 60.9% 58.6% (2) Percentages
   represent distribution of direct risk in force (RIF) on a per policy basis and do not account for applicable stop loss amounts.
   Triad Guaranty Inc. Sequential Quarterly Statistical Information (con't.) (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun
   30, 2008 2008 2007 2007 2007 (Dollars in millions unless otherwise indicated) Production New insurance written (NIW): - Primary
   flow business $1,148 $1,913 $2,680 $3,720 $5,089 - Primary structured bulk business - - - 694 1,702 Total Primary 1,148 1,913
   2,680 4,414 6,791 - Modified Pool - - - 1,406 Total NIW $1,148 $1,913 $2,680 $4,414 $8,196 New risk written: - Primary (gross)
   $252 $451 $678 $1,203 $1,860 - Modified Pool - - - - 51 Total new risk written $252 $451 $678 $1,203 $1,912 Primary NIW by
   loan-to-value ratio (LTV): - Greater than 95.00% 11.1% 9.6% 29.7% 37.4% 36.1% - 90.01% to 95.00% 25.2% 29.1% 25.8% 23.1% 23.3%
   - 90.00% and below 63.7% 61.3% 44.5% 39.5% 40.7% Percent of Primary NIW from refinancings 36.2% 43.1% 27.6% 25.7% 36.9% Percent
   of Primary flow NIW subject to captive reinsurance arrangements 22.0% 43.9% 53.2% 47.6% 34.3% Mar 31, Dec 31, Sep 30, Jun
   30, 2007 2006 2006 2006 (Dollars in millions unless otherwise indicated) Production New insurance written (NIW): - Primary
   flow business $4,372 $3,612 $2,844 $2,559 - Primary structured bulk business 1,327 304 436 385 Total Primary 5,699 3,916 3,280
   2,944 - Modified Pool 1,925 2,130 2,956 2,980 Total NIW $7,624 $6,046 $6,236 $5,924 New risk written: - Primary (gross) $1,576
   $991 $865 $730 - Modified Pool 69 78 106 92 Total new risk written $1,645 $1,069 $971 $822 Primary NIW by loan-to-value ratio
   (LTV): - Greater than 95.00% 26.2% 16.2% 20.7% 12.2% - 90.01% to 95.00% 23.8% 25.3% 23.3% 22.0% - 90.00% and below 50.0% 58.5%
   56.0% 65.8% Percent of Primary NIW from refinancings 44.1% 41.5% 28.9% 32.5% Percent of Primary flow NIW subject to captive
   reinsurance arrangements 28.1% 31.9% 61.5% 61.2% Triad Guaranty Inc. Sequential Quarterly Statistical Information (con't.)
   (Unaudited) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 (Dollars in millions unless otherwise indicated)
   Delinquencies and Claim Information Total Primary delinquent loans 16,075 13,322 10,419 7,541 5,940 - Flow business 13,710
   11,576 9,166 6,807 5,504 - Bulk business 2,365 1,746 1,253 734 436 Total Modified Pool delinquent loans 10,526 8,594 6,402
   4,826 3,913 - Structured with deductibles (3) 6,221 5,128 4,072 3,104 2,508 - Structured without deductibles 4,305 3,466 2,330
   1,722 1,405 Total Primary delinquency rate 6.01% 4.89% 3.81% 2.80% 2.30% Modified Pool delinquency rate 10.75% 8.45% 6.09%
   4.42% 3.44% Primary average paid severity ($ thousands) $52.4 $42.6 $41.6 $36.9 $30.9 - Flow business $49.3 $41.4 $40.9 $36.9
   $30.9 - Bulk business $90.8 $68.3 $63.9 $35.9 $30.1 Primary net paid claims ($ thousands) $48,071 $29,209 $27,012 $23,058
   $16,687 - Flow business $41,805 $27,091 $25,798 $22,090 $15,965 - Bulk business $6,266 $2,119 $1,214 $968 $722 Modified Pool
   average paid severity ($ thousands) $55.6 $65.0 $57.9 $41.3 $26.6 Modified Pool net paid claims ($ thousands) $20,192 $10,852
   $9,328 $5,413 $1,386 Gross Case Reserves as percent of risk in default (4) 45.0% 40.5% 36.6% 32.1% 26.9% Financial Information
   (5) Loss ratio - GAAP 419.0% 307.0% 262.1% 148.2% 60.1% Expense ratio - GAAP 39.4% 25.5% 20.8% 22.4% 21.9% Combined ratio
   - GAAP 458.4% 332.5% 282.9% 170.6% 82.0% Risk-to-capital ratio 42.7:1 27.7:1 20.5:1 17.8:1 16.0:1 Mar 31, Dec 31, Sep 30,
   Jun 30, 2007 2006 2006 2006 (Dollars in millions unless otherwise indicated) Delinquencies and Claim Information Total Primary
   delinquent loans 5,632 5,565 5,201 5,001 - Flow business 5,335 5,265 4,892 4,666 - Bulk business 297 300 309 335 Total Modified
   Pool delinquent loans 3,366 3,001 2,387 1,944 - Structured with deductibles (3) 2,176 1,897 1,578 1,330 - Structured without
   deductibles 1,190 1,104 809 614 Total Primary delinquency rate 2.35% 2.47% 2.37% 2.31% Modified Pool delinquency rate 2.93%
   2.67% 2.16% 1.81% Primary average paid severity ($ thousands) $31.3 $28.1 $25.7 $25.8 - Flow business $31.1 $27.9 $25.0 $25.0
   - Bulk business $34.0 $29.8 $37.6 $32.5 Primary net paid claims ($ thousands) $16,447 $15,100 $13,016 $13,501 - Flow business
   $15,122 $13,880 $11,887 $11,614 - Bulk business $1,325 $1,220 $1,129 $1,887 Modified Pool average paid severity ($ thousands)
   $23.7 $26.2 $18.8 $19.4 Modified Pool net paid claims ($ thousands) $1,281 $1,493 $603 $930 Gross Case Reserves as percent
   of risk in default (4) 27.3% 27.0% 22.9% 24.3% Financial Information (5) Loss ratio - GAAP 50.9% 70.9% 35.7% 34.1% Expense
   ratio - GAAP 22.8% 22.8% 24.8% 25.6% Combined ratio - GAAP 73.7% 93.7% 60.5% 59.7% Risk-to-capital ratio 13.8:1 12.5:1 12.0:1
   11.8:1 (3) We record reserves in our financial statements for defaults on contracts where the incurred losses have exceeded
   the amount of the deductible. At June 30, 2008 there were approximately 2,670 defaults in structures in which the incurred
   losses had exceeded the deductible. (4) Reflects gross case reserves, which excludes IBNR and ceded reserves, as a percent
   of risk in default for total primary delinquent loans and total modified pool delinquent loans. Previous numbers have been
   restated to conform to current presentation. (5) The Loss & Expense Ratios do not reflect any impact from establishment
   of Premium Deficiency Reserve. (5) The Loss & Expense Ratios do not reflect any impact from establishment of Premium Deficiency
   Reserve. TRIAD GUARANTY INC. Sequential Quarterly Financial Statements (unaudited) Condensed Statements of Operations For
   The Quarter Ended (dollars in thousands) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 Revenue: Earned
   premiums $69,864 $72,065 $73,130 $72,090 $69,732 Net investment income 9,175 9,547 9,544 8,371 7,673 Other income (loss) (3,797)
   2,705 (27) 86 (3,864) Total revenues 75,242 84,317 82,647 80,547 73,540 Losses and expenses: Net losses and LAE 292,749 221,259
   191,652 106,813 41,893 Change in premium deficiency reserve (15,000) 15,000 - - - Interest expense on debt 696 1,476 1,827
   1,161 694 Amortization of DAC - 39,416 4,637 4,567 4,670 Other operating expenses 27,238 14,106 10,895 11,686 10,717 Total
   Losses and expenses 305,683 291,257 209,011 124,228 57,973 Income (loss) before income taxes (230,441) (206,940) (126,364)
   (43,680) 15,567 Income taxes (benefit) (31,630) (56,926) (51,405) (11,832) 3,541 Net income (loss) $(198,811) $(150,014) $(74,959)
   $(31,849) $12,026 Mar 31, Dec 31, Sep 30, Jun 30, 2007 2006 2006 2006 Revenue: Earned premiums $63,949 $58,222 $54,077 $50,668
   Net investment income 7,349 7,178 6,761 6,534 Other income (loss) 763 (50) (34) 777 Total revenues 72,061 65,350 60,804 57,979
   Losses and expenses: Net losses and LAE 32,581 41,300 19,305 17,271 Change in premium deficiency reserve - - - - Interest
   expense on debt 694 693 693 693 Amortization of DAC 4,624 4,180 4,108 4,118 Other operating expenses 10,330 9,268 9,278 8,497
   Total Losses and expenses 48,228 55,442 33,386 30,579 Income (loss) before income taxes 23,832 9,909 27,418 27,400 Income
   taxes (benefit) 6,510 1,805 8,027 7,814 Net income (loss) $17,322 $8,104 $19,392 $19,587 Condensed Balance Sheets As Of (dollars
   in thousands) Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, 2008 2008 2007 2007 2007 Assets Invested Assets: $869,022 $760,073 $784,539
   $794,373 $674,199 Cash 19,669 80,544 124,811 30,617 26,711 Real estate acquired 6,202 8,993 10,860 12,566 7,923 Deferred policy
   acquisition costs - - 36,243 35,574 35,157 Prepaid federal income tax 63,183 115,598 116,008 168,817 170,076 Reinsurance recoverable
   55,316 93,244 5,815 2 1 Other assets 50,406 52,572 54,577 54,724 46,210 Total assets $1,063,798 $1,111,024 $1,132,853 $1,096,673
   $960,277 Liabilities and stockholders' equity Liabilities: Losses and loss adjustment expenses $817,262 $547,766 $359,939
   $200,455 $122,061 Premium deficiency reserve - 96,073 - - - Deferred income taxes 30,386 61,522 123,297 170,477 177,889 Borrowing
   under credit facility - - 80,000 80,000 - Long term debt 34,527 34,522 34,519 34,517 34,514 Accrued expenses and other liabilities
   40,714 32,699 36,247 39,754 31,191 Total liabilities 922,889 772,582 634,002 525,203 365,655 Total stockholders' equity 140,909
   338,442 498,851 571,470 594,623 Total liabilities and stockholders' equity $1,063,798 $1,111,024 $1,132,853 $1,096,673 $960,277
   Mar 31, Dec 31, Sep 30, Jun 30, 2007 2006 2006 2006 Assets Invested Assets: $669,160 $607,312 $611,176 $575,315 Cash 10,429
   38,609 9,230 5,191 Real estate acquired 9,765 10,170 7,982 8,614 Deferred policy acquisition costs 35,035 35,143 34,681 34,203
   Prepaid federal income tax 166,693 166,908 159,268 151,908 Reinsurance recoverable 211 840 1 1 Other assets 40,223 36,648
   35,641 33,791 Total assets $931,515 $895,631 $857,979 $809,023 Liabilities and stockholders' equity Liabilities: Losses and
   loss adjustment expenses $98,721 $84,352 $60,123 $54,905 Premium deficiency reserve - - - - Deferred income taxes 180,232
   176,483 175,728 163,436 Borrowing under credit facility - - - - Long term debt 34,512 34,510 34,508 34,505 Accrued expenses
   and other liabilities 30,898 30,061 26,698 25,025 Total liabilities 344,363 325,407 297,057 277,870 Total stockholders' equity
   587,152 570,224 560,922 531,153 Total liabilities and stockholders' equity $931,515 $895,631 $857,979 $809,023 

SOURCE Triad Guaranty Inc.

http://www.triadguaranty.com 

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