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UPDATE 1-Radian returns to profit as U.S. housing market recovers

* Fourth-quarter net profit $36.4 mln vs loss of $177 mln year-ago

* Provision for losses down more than 50 pct to $137.6 mln

Feb 5 (Reuters) - Radian Group Inc, the biggest U.S. private mortgage insurer, reported a quarterly profit after four straight losses as fewer homeowners defaulted on their loans in a recovering housing market.

Mortgage insurers have been writing more profitable insurance policies as fewer people default on home loans, largely helped by a recovery in the U.S. housing market.

Mortgage insurers cover losses when homeowners default on payments and foreclosures fail to recoup costs.

Rival MGIC Investment Corp reported a smaller-than-expected quarterly loss last month due to fewer defaults, while Genworth Financial Inc on Tuesday said profit was boosted by strong performance at its mortgage insurance business.

Radian more than halved its provision for losses to $137.6 million in the fourth quarter compared with the year-earlier period.

"We expect that the size and credit quality of our MI (mortgage insurance) portfolio will fuel improved levels of operating profitability this year," Chief Executive S.A. Ibrahim said in a statement.

Net profit was $36.4 million, or 19 cents per share, for the fourth quarter ended Dec.31, compared with a loss of $177.3 million, or $1.34 per share, a year earlier.

Analysts on an average expected the company to break even on a per-share basis, according to Thomson Reuters I/B/E/S.

Philadelphia-based Radian's risk-to-capital ratio was 19.4 to 1 as of Dec. 31, down from 20.8 to 1 at the end of 2012.

Most U.S. states allow a maximum ratio of 25 to 1 after which the insurer must seek waivers in individual states to continue writing insurance.

Radian's shares closed at $14.33 on Tuesday on the New York Stock Exchange.

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