FORM 10-Q
                               ------------------

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities  Exchange
Act of 1934

                For the quarterly period ended September 30, 2002

                                       or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934

                 For the transition period from ______ to _____


                         Commission File Number 0-22342

                               TRIAD GUARANTY INC.
             (Exact name of registrant as specified in its charter)

        DELAWARE                                         56-1838519
(State of Incorporation)                      (I.R.S. Employer Identification
                                                           Number)


                            101 SOUTH STRATFORD ROAD
                       WINSTON-SALEM, NORTH CAROLINA 27104
                    (Address of principal executive offices)

                                 (336) 723-1282
              (Registrant's telephone number, including area code)
                         ------------------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes /X/ No / /

Number of shares of Common Stock, $.01 par value,  outstanding as of November 1,
2002: 14,143,336 shares.

<PAGE>

                               TRIAD GUARANTY INC.

                                      INDEX
                                                                            Page
                                                                          Number
                                                                         ------
Part I. Financial Information:

    Item 1. Financial Statements:

    Consolidated Balance Sheets as of September 30, 2002 (Unaudited)
       and December 31, 2001................................................  3

    Consolidated Income Statements for the Three and Nine Months
       Ended September 30, 2002 and 2001 (Unaudited).......................   4

    Consolidated Statements of Cash Flow for the Nine Months
       Ended September 30, 2002 and 2001 (Unaudited).......................   5

    Notes to Consolidated Financial Statements.............................   6

    Item 2. Management's Discussion and Analysis of Financial Condition
       and Results of Operations...........................................   9

    Item 3. Quantitative and Qualitative Disclosures about Market Risk.....  17

    Item 4. Controls and Procedures........................................  17

Part II. Other Information:

    Item 1. Legal Proceedings..............................................  18

    Item 2. Changes in Securities and Use of Proceeds......................  18

    Item 3. Defaults Upon Senior Securities................................  18

    Item 4. Submission of Matters to a Vote of Security Holders............  18

    Item 5. Other Information..............................................  18

    Item 6. Exhibits and Reports on Form 8-K...............................  18

    Signatures and Certifications of the Chief Executive Officer
       and Chief Financial Officer of the Company..........................  18

                                        2





<PAGE>
                               TRIAD GUARANTY INC.
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                  September 30,   December 31,
                                                                       2002           2001
                                                                  -------------   ------------
                                                                   (Unaudited)
(Dollars in thousands except per share information)

Assets
Invested assets:
<S>                                                                   <C>            <C>
    Fixed maturities, available-for-sale, at fair value..........     $297,692       $245,986
    Equity securities, available-for-sale, at fair value.........       10,632         12,476
    Short-term investments.......................................       24,794         18,739
                                                                      --------       --------
                                                                       333,118        277,201

Cash ............................................................          832            854
Real estate......................................................          986            162
Accrued investment income........................................        3,283          3,196
Deferred policy acquisition costs................................       29,233         25,944
Prepaid federal income taxes.....................................       73,526         62,619
Property and equipment...........................................       10,283         11,169
Reinsurance recoverable..........................................          510              5
Other assets.....................................................       16,166         15,305
                                                                      --------       --------
Total assets.....................................................     $467,937       $396,455
                                                                      ========       ========
Liabilities and stockholders' equity
Liabilities:
    Losses and loss adjustment expenses..........................     $ 20,108       $ 17,991
    Unearned premiums............................................        8,374          7,650
    Amounts payable to reinsurer.................................        2,761          2,445
    Current taxes payable........................................          659             40
    Deferred income taxes........................................       90,386         74,773
    Unearned ceding commission...................................        1,622          2,324
    Long-term debt...............................................       34,478         34,473
    Accrued interest on debt.....................................          584          1,275
    Accrued expenses and other liabilities.......................        9,254          9,415
                                                                      --------       --------
Total liabilities................................................      168,226        150,386
Commitments and contingent liabilities - Note 4
Stockholders' equity:
    Preferred stock, par value $.01 per share --- authorized
       1,000,000 shares; no shares issued and outstanding........          ---            ---
    Common stock, par value $.01 per share --- authorized
       32,000,000 shares; issued and outstanding 14,143,336
       shares at September 30, 2002 and 13,691,672 at
       December 31, 2001.........................................          141            137
    Additional paid-in capital...................................       79,741         69,057
    Accumulated other comprehensive income, net of income
       tax liability of $6,176 at September 30, 2002 and
       $522 at December 31, 2001.................................       11,475            975
    Deferred compensation........................................         (757)          (118)
    Retained earnings............................................      209,111        176,018
                                                                      --------       --------
Total stockholders' equity.......................................      299,711        246,069
                                                                      --------       --------
Total liabilities and stockholders' equity.......................     $467,937       $396,455
                                                                      ========       ========
</TABLE>
                             See accompanying notes.

                                        3

<PAGE>

                               TRIAD GUARANTY INC.
                         CONSOLIDATED INCOME STATEMENTS
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                             Three Months Ended              Nine Months Ended
                                                                 September 30                  September 30
                                                         --------------------------      -----------------------
                                                             2002            2001            2002         2001
                                                             ----            ----            ----         ----
(Dollars in thousands except per share information)
<S>                                                      <C>             <C>             <C>          <C>
Revenue:
Premiums written:
   Direct...........................................        $33,199         $23,835         $90,821      $67,626
   Assumed..........................................              1               1               3            4
   Ceded............................................         (4,919)         (3,014)        (12,761)      (7,219)
                                                         ----------      ----------      ----------   ----------
Net premiums written................................         28,281          20,822          78,063       60,411
Change in unearned premiums.........................           (930)           (305)           (678)         (68)
                                                         ----------      ----------      ----------   ----------
Earned premiums.....................................         27,351          20,517          77,385       60,343
Net investment income...............................          4,156           3,804          11,873       10,937
Realized investment gains (losses)..................           (446)            187          (2,674)         801
Other income........................................             15               4              57        1,886
                                                         ----------      ----------      ----------   ----------
                                                             31,076          24,512          86,641       73,967
Losses and expenses:
Losses and loss adjustment expenses.................          4,390           1,549           9,787        5,884
Reinsurance recoveries..............................              2             (30)              -          (28)
                                                         ----------      ----------      ----------   ----------
Net losses and loss adjustment expenses.............          4,392           1,519           9,787        5,856
Interest expense on debt............................            693             693           2,078        2,078
Amortization of deferred policy acquisition costs...          3,377           2,894           9,423        7,903
Other operating expenses (net)......................          5,587           4,464          17,420       13,108
                                                         ----------      ----------      ----------   ----------
                                                             14,049           9,570          38,708       28,945
                                                         ----------      ----------      ----------   ----------
Income before income taxes .........................         17,027          14,942          47,933       45,022
Income taxes:
   Current..........................................            167              45             499          137
   Deferred.........................................          5,095           4,559          14,341       13,797
                                                         ----------      ----------      ----------   ----------
                                                              5,262           4,604          14,840       13,934
                                                         ----------      ----------      ----------   ----------
Net income..........................................        $11,765         $10,338         $33,093      $31,088
                                                         ==========      ==========      ==========   ==========
Earnings per common and common equivalent share:
   Basic............................................        $  .83          $  .76          $ 2.36        $ 2.31
                                                         ==========      ==========     ===========     ========
   Diluted..........................................        $  .82          $  .73          $ 2.31        $ 2.23
                                                         ==========      ==========     ===========     ========
Shares used in computing earnings per common and
 common equivalent share:
   Basic............................................     14,139,212      13,685,744      14,031,088   13,472,818
                                                         ==========      ==========      ==========   ==========
   Diluted..........................................     14,373,988      14,078,609      14,322,151   13,927,275
                                                         ==========      ==========      ==========   ==========
</TABLE>

                             See accompanying notes.

                                        4
<PAGE>
                               TRIAD GUARANTY INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOW
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                         Nine Months Ended
                                                                            September 30
                                                                     ------------------------
                                                                      2002               2001
                                                                      ----               ----
(Dollars in thousands)
<S>                                                                  <C>             <C>
Operating activities
Net income......................................................     $33,093         $31,088
Adjustments to reconcile net income to net cash
provided by operating activities:
   Loss and unearned premium reserves...........................       2,841           1,658
   Accrued expenses and other liabilities.......................      (4,314)         (2,293)
   Current taxes payable........................................         619             137
   Amounts due to/from reinsurer................................        (236)            872
   Accrued investment income....................................         (87)           (324)
   Policy acquisition costs deferred............................     (12,712)        (10,690)
   Amortization of policy acquisition costs.....................       9,423           7,903
   Net realized investment losses (gains).......................       2,674            (801)
   Provision for depreciation...................................       2,138           1,654
   Accretion of discount on investments.........................      (3,389)         (2,224)
   Deferred income taxes........................................      14,341          13,797
   Prepaid federal income tax...................................     (10,907)         (7,041)
   Unearned ceding commission...................................        (702)          1,127
   Real estate acquired in claim settlement.....................        (824)              1
   Accrued interest on debt.....................................        (691)           (691)
   Other assets.................................................        (813)         (1,619)
   Other operating activities...................................         298              88
                                                                     -------         -------
Net cash provided by operating activities.......................      30,752          32,642

Investing activities
Securities available-for-sale:
      Purchases - fixed maturities..............................     (62,700)        (56,462)
      Sales - fixed maturities..................................      34,376          26,016
      Purchases - equity securities.............................      (2,140)         (3,307)
      Sales - equity securities.................................       1,625           2,369
   Purchase of property and equipment...........................      (1,252)         (3,401)
                                                                     -------         -------
Net cash used in investing activities...........................     (30,091)        (34,785)

Financing activities
Proceeds from exercise of stock options.........................       5,372           2,871
                                                                     -------         -------
Net cash provided by financing activities.......................       5,372           2,871
                                                                     -------         -------
Net change in cash and short-term investments...................       6,033             728
Cash and short-term investments at beginning of period..........      19,593          18,525
                                                                     -------         -------
Cash and short-term investments at end of period................     $25,626         $19,253
                                                                     =======         =======

Supplemental schedule of cash flow information
Cash paid during the period for:
   Income taxes and United States Mortgage Guaranty
     Tax and Loss Bonds.........................................     $11,536         $ 7,026

     Interest...................................................     $ 2,765         $ 2,765
</TABLE>
                             See accompanying notes.

                                        5
<PAGE>

                               TRIAD GUARANTY INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2002
                                   (Unaudited)

NOTE 1 -- THE COMPANY

     Triad Guaranty Inc. is a holding company which, through its wholly-owned
subsidiary, Triad Guaranty Insurance Corporation ("Triad"), provides private
mortgage insurance coverage in the United States to mortgage lenders and
investors to protect the lender or investor against loss from defaults on low
down payment residential mortgage loans.


NOTE  2 -- BASIS OF PRESENTATION

     The accompanying unaudited consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States for interim financial information and with the instructions to
Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all
of the information and footnotes required by accounting principles generally
accepted in the United States for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the three and nine months ended September 30, 2002 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 2002. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Triad Guaranty Inc. annual
report on Form 10-K for the year ended December 31, 2001.


NOTE 3 -- CONSOLIDATION

     The consolidated financial statements include Triad Guaranty Inc. and its
wholly-owned subsidiary, Triad Guaranty Insurance Corporation ("Triad"), and
Triad's wholly-owned subsidiaries, Triad Guaranty Assurance Corporation and
Triad Re Insurance Corporation (collectively referred to as "the Company"). All
significant intercompany accounts and transactions have been eliminated.


NOTE 4 -- COMMITMENTS AND CONTINGENT LIABILITIES

     REINSURANCE - Triad assumes and cedes certain premiums and losses from/to
reinsurers under various reinsurance agreements. Reinsurance contracts do not
relieve Triad from its obligations to policyholders. Failure of the reinsurer to
honor its obligation could result in losses to Triad; consequently, allowances
are established for amounts when deemed uncollectible.

                                        6
<PAGE>

                               TRIAD GUARANTY INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2002
                                   (Unaudited)


INSURANCE IN FORCE, DIVIDEND RESTRICTIONS, AND STATUTORY RESULTS - Insurance
regulations generally limit the writing of mortgage guaranty insurance to an
aggregate amount of insured risk no greater than 25 times the total of statutory
capital and surplus and the statutory contingency reserve. The amount of net
risk for insurance in force at September 30, 2002 and December 31, 2001, as
presented below, was computed by applying the various percentage settlement
options and applicable stop-loss parameters to the insurance in force amounts
based on the original insured amount of the loan. Triad's ratio is as follows:


                                          September 30,     December 31,
                                              2002              2001
                                           -----------      -----------
(Dollars in thousands)
Net risk............................       $ 5,370,519      $ 4,471,705
                                           ===========      ===========
Statutory capital and surplus.......       $   107,510        $ 105,306
Statutory contingency reserve.......           231,649          193,747
                                           -----------      -----------
Total...............................       $   339,159        $ 299,053
                                           ===========      ===========
Risk-to-capital ratio...............         15.8-to-1        15.0-to-1
                                           ===========      ===========


     Triad and its wholly-owned subsidiaries, Triad Guaranty Assurance
Corporation and Triad Re Insurance Corporation, are each required under their
respective domiciliary states' insurance code to maintain a minimum level of
statutory capital and surplus. Triad, an Illinois domiciled insurer, is required
under the Illinois Insurance Code (the "Code") to maintain minimum statutory
capital and surplus of $5 million. The Code permits dividends to be paid only
out of earned surplus and also requires prior approval of extraordinary
dividends. An extraordinary dividend is any dividend or distribution of cash or
other property, the fair value of which, together with that of other dividends
or distributions made within a period of twelve consecutive months, exceeds the
greater of (a) ten percent of statutory surplus as regards policyholders, or (b)
statutory net income for the calendar year preceding the date of the dividend.

     Net income as determined in accordance with statutory accounting practices
was $44.7 million for the nine months ended September 30, 2002, $41.8 million
for the nine months ended September 30, 2001, and $55.4 million for the year
ended December 31, 2001.

     At September 30, 2002 and December 31, 2001, the amount of Triad's equity
that could be paid out in dividends to stockholders was $23.3 million and $21.6
million, respectively, which was the earned surplus of Triad on a statutory
basis on those dates.

     LOSS RESERVES - The Company establishes loss reserves to provide for the
estimated costs of settling claims with respect to loans reported to be in
default and loans in default which have not been reported to the Company.

                                        7
<PAGE>
                               TRIAD GUARANTY INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                               September 30, 2002
                                   (Unaudited)

Reserves are established by management using estimated claim rates (frequency)
and claim amounts (severity) to estimate ultimate losses. The reserving process
gives effect to current economic conditions and profiles delinquencies by such
factors as policy year, geography, chronic late payment characteristics and age.
Due to the inherent uncertainty in estimating reserves for losses and loss
adjustment expenses, there can be no assurance that the reserves will prove to
be adequate to cover ultimate loss development.


NOTE 5 - - EARNINGS PER SHARE

     Basic and diluted earnings per share are based on the weighted-average
daily number of shares outstanding. For diluted earnings per share, the
denominator includes the dilutive effect of stock options on the
weighted-average shares outstanding. There are no other reconciling items
between the denominator used in basic earnings per share and diluted earnings
per share. The numerator used in basic earnings per share and diluted earnings
per share is the same for all periods presented.


NOTE 6 - - COMPREHENSIVE INCOME

     Comprehensive income consists of net income and other comprehensive income.
For the Company, other comprehensive income is composed of unrealized gains or
losses on available-for-sale securities, net of income tax. For the three months
ended September 30, 2002 and 2001, the Company's comprehensive income was $19.3
million and $11.6 million, respectively. For the nine months ended September 30,
2002 and 2001, the Company's comprehensive income was $43.6 million and $31.9
million, respectively.


















                                        8
<PAGE>

ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS


RESULTS OF OPERATIONS

     Net income for the first nine months of 2002 increased 6.4% to $33.1
million or $2.31 per diluted share compared to $31.1 million or $2.23 per
diluted share for the first nine months of 2001. Net income for the first nine
months of 2001 included the receipt of a nonrecurring incentive payment of
approximately $1.9 million or $0.09 per diluted share relating to the
cancellation of one of the Company's excess of loss reinsurance contracts. The
payment was reported as other income in the first quarter of 2001. Net income
for the third quarter of 2002 increased 13.8% to $11.8 million or $0.82 per
diluted share from $10.3 million or $0.73 per diluted share in the third quarter
of 2001. Earnings per share for the first nine months of 2002 includes $0.12 per
share of net realized investment losses compared to $0.04 per share of net
realized investment gains in the first nine months of 2001. Earnings per share
for the third quarter of 2002 includes $0.02 per share of net realized
investment losses compared to less than $0.01 per share of net realized
investment gains for the third quarter of 2001.

     Operating earnings for the first nine months of 2002 increased 13.9% to
$34.8 million from $30.6 million for the first nine months of 2001. For the
third quarter of 2002, operating earnings increased 18.0% to $12.1 million from
$10.2 million in the third quarter of 2001. Operating earnings exclude realized
investment losses of $2.7 million in the first nine months of 2002 and realized
investment gains of $801,000 in the first nine months of 2001. For the third
quarter of 2002 and 2001, operating earnings exclude realized investment losses
of $446,000 and realized investment gains of $188,000, respectively. Operating
earnings per share on a diluted basis were $2.43 for the first nine months of
2002 compared to $2.19 per share for the same period of 2001. For the third
quarter of 2002, operating earnings per share on a diluted basis were $0.84
compared to $0.73 per share for the third quarter of 2001. Excluding the effects
of the nonrecurring incentive payment from operating results for the first nine
months of 2001, operating earnings increased 18.6% and operating earnings per
diluted share increased 15.3% for the first nine months of 2002 compared to the
first nine months of 2001. The improvement in operating earnings is attributable
primarily to a 28.2% (33.3% in the third quarter) increase in earned premiums
and an 8.6% (9.3% in the third quarter) increase in net investment income.

     Traditional flow insurance written for the first nine months of 2002
increased 49.5% to $8.4 billion from $5.6 billion in the first nine months of
2001. For the third quarter of 2002, traditional flow insurance written was $3.0
billion compared to $2.3 billion in the third quarter of 2001, an increase of
30.4%. The increase in new insurance written from traditional flow production
was primarily the result of expanding relationships with national lenders,
strong demand for risk-sharing arrangements, and a lower interest rate
environment.

     Insurance written in the first nine months of 2002 attributable to
structured bulk transactions totaled $1.2 billion ($478 million in the third
quarter) compared to $2.9 billion in the first nine months of 2001 ($1.5 billion
in the third quarter). Structured bulk transactions are generally initiated by
secondary mortgage market participants where mortgage insurance is used as a
credit enhancement. The Company competes against other mortgage insurers as well
as other forms of credit enhancements provided by capital markets for these

                                        9
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


transactions. Insurance written attributed to structured bulk transactions is
likely to vary significantly due to the relatively small number of transactions
that encompass this market (as opposed to the traditional flow market), the
competitive nature of the market, and the unknown loan composition of the
market.

     Total insurance written was $9.7 billion for the first nine months of 2002
compared to $8.5 billion for the first nine months of 2001, an increase of
13.9%. For the third quarter of 2002, total insurance written was $3.5 billion
compared to $3.8 billion for the third quarter of 2001, a decrease of 9.2%.

     Consolidation within the mortgage origination industry and Triad's
continued focus on national lenders has resulted in a greater percentage of
production volume being concentrated among a smaller customer base. The loss of
one or more of these significant customers could have a significant adverse
effect on the Company's business. According to industry data, Triad's national
market share of net new primary insurance written, which includes insurance
written on a traditional flow basis as well as that attributed to strucutured
bulk transactions, was 4.0% for the third quarter and 3.6% for the first nine
months of 2002 compared to 4.5% and 3.4% for the respective periods in 2001.
Triad's national market share of net new primary insurance written on a
traditional flow basis was 4.3% for the third quarter and 4.2% for the first
nine months of 2002 compared to 3.3% and 3.1% for the respective periods in
2001.Net new primary insurance written excludes insurance placed on loans more
than 12 months after loan origination, insurance placed on loans already covered
by primary mortgage insurance, and insurance placed on loans where lender
exposure is effectively reduced below defined minimums. This treatment is
consistent with the definitions adopted by the Company and the industry
regarding the computation of new insurance written for market share purposes.
Total direct insurance in force reached $25.0 billion at September 30, 2002,
compared to $19.5 billion at September 30, 2001, an increase of 28.1%.

     Total direct premiums written were $90.8 million for the first nine months
of 2002, an increase of 34.3% from $67.6 million for the first nine months of
2001. Direct premiums written for the third quarter of 2002 increased 39.3% to
$33.2 million compared to $23.8 million for the same period of 2001. Net
premiums written were $78.1 million in the first nine months of 2002, an
increase of 29.2% from $60.4 million for the same period of 2001. Net premiums
written for the third quarter of 2002 increased by 35.8% to $28.3 million
compared to $20.8 million for the same period of 2001. Earned premiums increased
28.2% to $77.4 million for the first nine months of 2002 from $60.3 million for
the first nine months of 2001. Earned premiums for the third quarter of 2002
were $27.4 million compared to $20.5 million for the same period of 2001, an
increase of 33.3%. This growth in written and earned premiums resulted from
strong levels of insurance written offset by the impact of a low persistency
rate due to the high level of refinance activity.

     Growth in direct premiums written was partially offset by an increase in
ceded premiums written. Driven by increases in risk-sharing arrangements, ceded
premium written increased 76.8% to $12.8 million for the first nine months of

                                       10
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


2002 from $7.2 million for the first nine months of 2001. Ceded premiums written
in the third quarter of 2002 were $4.9 million compared to $3.0 million in the
same period of 2001, an increase of 63.2%. The Company's premium ceded rate (the
ratio of ceded premiums written to direct premiums written) was 14.1% in the
first nine months of 2002 (14.8% in the third quarter) compared to 10.7% in the
first nine months of 2001 (12.6% in the third quarter). Approximately 53% of
flow insurance written (46% including structured bulk transactions) during the
first nine months of 2002 is subject to risk-sharing arrangements compared to
59% of flow insurance written (40% including structured bulk transactions) in
the first nine months of 2001. Management anticipates ceded premiums will
increase as a result of continued lender participation in risk-sharing programs.

     Refinance activity was 37.4% of insurance written (37.0% excluding
structured bulk transactions) in the first nine months of 2002 compared to 31.6%
of insurance written (34.0% excluding structured bulk transactions) in the same
period of 2001. Refinance activity was 33.0% of insurance written (31.2%
excluding structured bulk transactions) in the third quarter of 2002 compared to
33.6% of insurance written (28.9% excluding structured bulk transactions) in the
same period of 2001. Persistency, or the percentage of insurance in force
remaining from 12 months prior, was 61.3% at September 30, 2002 compared to
67.6% at December 31, 2001, and 72.3% at September 30, 2001. The high level of
refinance activity and the resulting decrease in persistency is reflective of
the low interest rate environment that has been in place over the previous 12
months. Low persistency results in an acceleration of the amortization of
deferred policy acquisition costs and a reduction in renewal premiums. The
annualized quarterly persistency run rate for the third quarter of 2002 was
57.9% compared to 61.7% in the third quarter of 2001.

     The Company defines persistency as the percentage of insurance in force
remaining from 12 months prior. Run off, defined as cancelled or terminated
policies, of production originated during the past 12 months is not considered
in the Company's calculation of persistency. The Company calculates persistency
by determining the run off over the prior 12 months of each individual policy
year (exclusive of current year production). This method of calculating
persistency may vary from that of other mortgage insurers. The Company believes
that its calculation presents an accurate measure of the percentage of insurance
in force remaining from 12 months prior. The Company's current method of
calculating persistency is consistent with the methodology used by the Company
in prior years.

     Net investment income for the first nine months of 2002 was $11.9 million,
an 8.6% increase over $10.9 million in the first nine months of 2001. Net
investment income for the third quarter of 2002 was $4.2 million compared to
$3.8 million in the same period of 2001, an increase of 9.3%. This increase in
investment income is the result of growth in the average book value of invested
assets by $47.3 million to $294.0 million at September 30, 2002 from $246.7
million at September 30, 2001. The growth in invested assets is attributable to
normal operating cash flow. The pre-tax yield on average invested assets
decreased to 5.4% for the first nine months of 2002 compared to 5.9% for the
first nine months of 2001, reflecting the current low interest rate environment
for new money investments and the disposal of a number of higher yielding, lower
quality securities during the past twelve months to enhance the overall quality
of the portfolio. The portfolio's tax-equivalent yield-to-maturity was 7.9% for
the first nine months of 2002 versus 8.1% for the first nine months of 2001.

                                       11
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


Based on fair value, approximately 79% and 72% of the Company's fixed maturity
portfolio at September 30, 2002 and 2001, respectively, was composed of state
and municipal tax-preferred securities. At September 30, 2002, based on fair
value, approximately 95% of the Company's fixed maturity portfolio was either a
U.S. government or U.S. agency obligation or was rated investment grade by at
least one nationally recognized securities rating organization compared to
approximately 92% of the Company's fixed maturity portfolio at September 30,
2001.

     The Company actively monitors investment securities considered to be at
risk for impairment. When the Company determines that a decline in the value of
a security below its amortized cost is other-than-temporary, an impairment loss
has occurred. In the event of permanent impairment, the Company writes down the
cost basis of the security to its fair value and recognizes a realized loss for
the amount of the writedown. Realized losses in the first nine months of 2002
included impairment writedowns of approximately $1.6 million on bonds held in
the Company's portfolio, with approximately $261,000 of impairment writedowns
occurring in the third quarter. For the first nine months, the writedowns
primarily involved securities in the telecommunications and technology sectors.
For the quarter, the writedowns also included securities in the airline and
textile manufacturing industries.

     Net losses and loss adjustment expenses (net of reinsurance recoveries)
increased by 67.1% in the first nine months of 2002 to $9.8 million from $5.9
million for the same period of 2001. Net losses and loss adjustment expenses
were $4.4 million in the third quarter of 2002 compared to $1.5 million in the
third quarter of 2001, an increase of 189%. This rise reflects an increase in
paid losses and delinquent loans as the Company's insurance in force grows and
matures. Net paid losses and loss adjustment expenses were $7.7 million in the
first nine months of 2002, up from $4.3 million in the first nine months of
2001. Net paid losses and loss adjustment expenses were $3.0 million in the
third quarter of 2002 compared to $1.5 million in the third quarter of 2001.
Reported delinquent loans totaled 1,956 at September 30, 2002, compared to 1,420
at December 31, 2001 and 1,139 at September 30, 2001. The delinquency inventory
count includes all reported delinquencies that are three or more payments in
arrears at the reporting date and all reported delinquencies that were
previously three or more payments in arrears and have not made payments to the
current due date. Reserves are established for all insured loans reported as
delinquent to the Company by the loan servicer. The Company's loss ratio (the
ratio of incurred losses to earned premiums) was 12.6% for the first nine months
of 2002 compared to 9.7% for the same period of 2001 and 10.7% for all of 2001.
The loss ratio was 16.1% for the third quarter of 2002 and 7.4% for the third
quarter of 2001.

     As of September 30, 2002, approximately 80% of the Company's insurance in
force was originated in the last 36 months. Management believes, based upon its
experience and industry data, that claims incidence for it and other private
mortgage insurers is generally highest in the third through sixth years after
loan origination. Although the claims experience on insurance written in
previous years has been quite favorable, management does not expect losses to
remain at the low levels currently reported. The Company expects its incurred

                                       12
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


losses to increase as a greater amount of its insurance in force reaches its
anticipated highest claim frequency years. Furthermore, changes in the economic
environment could accelerate paid and incurred loss development. Due to the
inherent uncertainty of future premium levels, losses, economic conditions, and
other factors that affect earnings, it is impossible to predict with any degree
of certainty the impact of such higher claim frequencies on future earnings.

     Amortization of deferred policy acquisition costs increased by 19.2% to
$9.4 million in the first nine months of 2002 from $7.9 million for the first
nine months of 2001. These amortization costs were $3.4 million in the third
quarter of 2002 compared to $2.9 million in the third quarter of 2001, an
increase of 16.7%. The increase in amortization reflects growth in deferred
policy acquisition costs to amortize related to the growth of the Company's
insurance in force and accelerated amortization due to higher cancellations from
refinance activity in the first nine months of 2002.

     Other operating expenses increased 32.9% to $17.4 million for the first
nine months of 2002 from $13.1 million for the same period of 2001. For the
third quarter of 2002, other operating expenses were $5.6 million compared to
$4.5 million in the third quarter of 2001, an increase of 25.2%. This increase
in expenses is primarily attributable to personnel, technology amortization, and
equipment costs required to support the Company's increased levels of
production, product development, system enhancements, and geographic expansion.
The expense ratio (ratio of underwriting expenses to net premiums written) for
the first nine months of 2002 was 34.4% compared to 34.8% for the first nine
months of 2001 and 35.1% for all of 2001. The expense ratio for the third
quarter of 2002 was 31.7% compared to 35.3% for the third quarter of 2001.

     The effective tax rate for the first nine months of 2002 and 2001 was 31.0%
and 30.9%, respectively. The effective tax rate was 30.9% for the third quarter
of 2002 compared to 30.8% for the third quarter of 2001. Management expects the
Company's effective tax rate to remain near current levels as long as yields
from new funds invested in tax-preferred securities remain favorable in relation
to fully taxable securities.

LIQUIDITY AND CAPITAL RESOURCES

     The Company's sources of operating funds consist primarily of premiums
written and investment income. Operating cash flow is applied primarily to the
payment of claims, interest, operating expenses, and taxes.

     The Company generated positive cash flow from operating activities for the
first nine months of 2002 of $30.8 million compared to $32.6 million for the
same period of 2001. Triad's positive operating cash flow in the first nine
months of 2002 reflects premiums and investment income received that were
greater than expenses and losses paid. The decrease in operating cash flow from
the prior-year level reflects primarily the receipt of a $1.9 million cash
payment in the prior-year period from the cancellation of an excess of loss
reinsurance contract.

                                       13
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


     The Company's business does not routinely require significant capital
expenditures other than for enhancements to its computer systems and
technological capabilities. Positive cash flows are invested pending future
payments of claims and expenses. Cash flow shortfalls, if any, could be funded
through sales of short-term investments and other investment portfolio
securities.

     The parent company's cash flow is dependent on interest income and payments
from Triad including management fees and interest payments under surplus notes.
The Illinois Insurance Department permits expenses of the parent company to be
reimbursed by Triad in the form of management fees. Payment of dividends is also
permitted, although none have been paid to date.

     The insurance laws of the State of Illinois impose certain restrictions on
dividends that Triad can pay the parent company. These restrictions, based on
statutory accounting practices, include requirements that dividends may be paid
only out of statutory earned surplus and limit the amount of dividends that may
be paid without prior approval of the Illinois Insurance Department.

     Consolidated invested assets were $333.1 million at September 30, 2002
compared to $277.2 million at December 31, 2001. Fixed maturity securities and
equity securities classified as available-for-sale totaled $308.3 million at
September 30, 2002. Net unrealized investment gains were $19.0 million on fixed
maturity securities and net unrealized investment losses were $1.3 million on
equity securities at September 30, 2002. Based on fair value, the fixed maturity
portfolio consisted of approximately 79% municipal securities, 17% corporate
securities, and 4% U.S. government obligations at September 30, 2002.

     The Company's loss reserves were $20.1 million at September 30, 2002
compared to $18.0 million at December 31, 2001. Reserves are established for
reported insurance losses and loss adjustment expenses based on when notices of
default on insured mortgage loans are received. Reserves also are established
for estimated losses incurred on notices of default not yet reported by the
lender. Consistent with industry practices, the Company does not establish loss
reserves for future claims on insured loans that are not currently in default.
The growth in loss reserves is the result of the increase in reported defaults
and the maturing of the Company's risk in force. The Company expects loss
reserves to continue to grow, reflecting the growth and aging of its insurance
in force. Including bulk loans, the Company's delinquency ratio (the ratio of
delinquent insured loans to total insured loans) was 1.05% at September 30, 2002
compared to 0.89% at December 31, 2001. The Company's delinquency ratio for bulk
loans was 1.01% at September 30, 2002. There were no reported delinquencies for
bulk loans at December 31, 2001.

     Reserves are established by management using estimated claim rates
(frequency) and claim amounts (severity) to estimate ultimate losses. The
reserving process incorporates a multi-dimensional analytical form that gives
effect to current economic conditions and profiles delinquencies by such factors
as policy year, geography, chronic late payment characteristics, and the number
of months the policy has been in default. Because the estimate for loss reserves

                                       14
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


is sensitive to the estimates of claims frequency and severity, management
performs sensitivity analyses to test the reasonableness of the best estimate
generated by the loss reserve process. These sensitivity analyses allow
management to use alternative assumptions related to claims frequency and claims
severity to develop a range of reasonably possible loss reserve outcomes that
can be used to challenge the best estimate. The loss reserve estimation process
and the sensitivity analyses support the reasonableness of the best estimate of
loss reserves recorded as a liability in the financial statements. Management
periodically reviews the loss reserve process in order to improve its estimate
of ultimate losses on loans currently in default. Adjustments to reserve
estimates are reflected in the financial statements in the periods in which the
adjustments are made.

     Total stockholders' equity increased to $299.7 million at September 30,
2002 from $246.1 million at December 31, 2001. This increase resulted primarily
from net income of $33.1 million for the first nine months of 2002, an increase
in net unrealized gains on invested assets classified as available-for-sale of
$10.5 million (net of income tax), and additional paid-in-capital of $9.8
million resulting from the exercise of employee stock options and the related
tax benefit.

     Triad's total statutory policyholders' surplus increased to $107.5 million
at September 30, 2002 from $105.3 million at December 31, 2001. Triad's
statutory earned surplus increased to $23.3 million at September 30, 2002 from
$21.6 million at December 31, 2001. The increase in Triad's statutory
policyholders' surplus and statutory earned surplus resulted, primarily, from
growth in statutory net income greater than the increase in the statutory
contingency reserve and a $2.2 million increase in unrealized investment losses
on a statutory basis. The balance in the statutory contingency reserve was
$231.6 million at September 30, 2002 compared to $193.7 million at December 31,
2001.

     Triad's ability to write insurance depends on the maintenance of its
financial strength ratings and the adequacy of its capital in relation to risk
in force. A lowered financial strength rating, a significant reduction of
capital, or a significant increase in risk may impair Triad's ability to write
additional insurance. A number of states also generally limit Triad's
risk-to-capital ratio to 25-to-1. As of September 30, 2002, Triad's
risk-to-capital ratio was 15.8-to-1 compared to 15.0-to-1 at December 31, 2001,
and to 11.1-to-1 for the industry as a whole at December 31, 2001, the latest
industry data available.

     Triad is rated "AA" by both Standard & Poor's Ratings Services and Fitch
Ratings and "Aa3" by Moody's Investors Service.

     The Office of Federal Housing Enterprise Oversight (OFHEO) issued its
risk-based capital rules for Fannie Mae and Freddie Mac in the first quarter of
2002. The regulation provides capital guidelines for Fannie Mae and Freddie Mac
in connection with their use of various types of credit protection
counterparties including a more preferential capital credit for insurance from a
"AAA" rated private mortgage insurer than for insurance from a "AA" rated
private mortgage insurer. The phase-in period for the new rules is ten years.
Based on information available at this time, the Company does not believe that

                                       15
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


the new rules will have a significant adverse impact on the Company. However, if
the new capital guidelines result in changes to the preferences of Fannie Mae
and Freddie Mac regarding their use of the various types of credit enhancements
or their choice of mortgage insurers based on their credit rating, the Company's
financial condition could be significantly harmed.

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

     Management's Discussion and Analysis and this Report contain
forward-looking statements relating to future plans, expectations, and
performance which involve various risks and uncertainties, including but not
limited to the following: interest rates may increase or decrease from their
current levels; housing transactions and mortgage insurance may decrease for
many reasons including changes in interest rates or economic conditions; the
Company's market share may change as a result of changes in underwriting
criteria or competitive products or rates; the amount of insurance written could
be adversely affected by changes in federal housing legislation, including
changes in the Federal Housing Administration loan limits and coverage
requirements of Freddie Mac and Fannie Mae; the Company's financial condition
and competitive position could be affected by legislation impacting the mortgage
guaranty industry specifically and the financial services industry in general;
rating agencies may revise methodologies for determining the Company's financial
strength ratings and may revise or withdraw the assigned ratings at any time;
decreases in persistency, which are affected by loan refinancings in periods of
low interest rates, may have an adverse effect on earnings; the amount of
insurance written and the growth in insurance in force or risk in force as well
as the performance of the Company may be adversely impacted by the competitive
environment in the private mortgage insurance industry, including the type,
structure, and pricing of products and services offered by the Company and its
competitors; if the Company fails to properly underwrite mortgage loans under
contract underwriting service agreements, the Company may be required to assume
the costs of repurchasing those loans; with consolidation occurring among
mortgage lenders and the Company's concentration of insurance in force generated
through relationships with significant lender customers, the loss of a
significant customer may have an adverse effect on earnings; the Company's
performance may by impacted by changes in the performance of the financial
markets and general economic conditions. Economic downturns in regions where
Triad's risk is more concentrated could have a particularly adverse effect on
Triad's financial condition and loss development. New OFHEO risk-based capital
rules could result in changes to the preferences of Fannie Mae and Freddie Mac
regarding types of credit enhancements or their choice of mortgage insurers
based on credit rating, and Triad's ability to compete with various types of
credit protection counterparties, including "AAA" rated private mortgage
insurers, could be severely limited. Fannie Mae is in the process of revising
its approval requirements for mortgage insurers. The new requirements are
expected to be finalized before the end of 2002 and would require prior approval
by Fannie Mae for many of Triad's activities and new products, allow for other
approved types of mortgage insurers rated less than "AA," and give Fannie Mae
increased rights to revise the eligibility standards of mortgage insurers. The
form the eligibility guidelines ultimately will take is unknown at this time,
but new guidelines, if issued, could have an adverse effect on the Company.

                                       16
<PAGE>

 ITEM 2.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF
              FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- CONTINUED


     Accordingly, actual results may differ from those set forth in the
forward-looking statements. Attention also is directed to other risk factors set
forth in documents filed by the Company with the Securities and Exchange
Commission.

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The  Company's  market  risk  exposures  at  September  30,  2002  have not
materially changed from those identified at December 31, 2001

ITEM 4.       CONTROLS AND PROCEDURES

     Within the 90 days prior to the filing date of this report the Company
evaluated the effectiveness of the design and operation of its disclosure
controls and procedures pursuant to the Exchange Act of 1934, Rule 13a-15. The
evaluation was conducted under the supervision and with the participation of
management, including the Chief Executive Officer (CEO) and Chief Financial
Officer (CFO). Based on that evaluation, management, including the CEO and CFO,
concluded that the Company's disclosure controls and procedures were effective.
Disclosure controls and procedures are designed to ensure that information
required to be disclosed in the Company's reports filed or submitted under the
Exchange Act is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's rules and forms.

     There have been no significant changes in the Company's internal controls
or in other factors that could significantly affect the Company's internal
controls subsequent to the date management carried out its evaluation.




                                       17
<PAGE>




PART II

ITEM 1. LEGAL PROCEEDINGS - None

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS - None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES - None

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None

ITEM 5. OTHER INFORMATION - None

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits - None

     (b)  Reports on Form 8-K

          On August 14, 2002, the Company filed a current report on Item 9 of
          Form 8-K relating to the certifications made by its Chief Executive
          Officer and Chief Financial Officer as required by Section 906 of the
          Sarbanes-Oxley Act of 2002.




SIGNATURES AND CERTIFICATIONS OF THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL
OFFICER OF THE COMPANY

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                                TRIAD GUARANTY INC.

Date: November 14, 2002
                                                /s/ Michael E. Crow
                                                ------------------------------
                                                Michael E. Crow
                                                Vice President and Controller,
                                                Principal Accounting Officer





                                       18
<PAGE>
Form 10-Q

                                 CERTIFICATIONS


I, Darryl W. Thompson, certify that:

     1.   I have reviewed this  quarterly  report on Form 10-Q of Triad Guaranty
          Inc.;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the  registrants as of,  and for, the periods  presented
          in this quarterly report;

     4.   The registrant's  other  certifying  officer and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and have:

          a)   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly report is being prepared;

          b)   evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          c)   presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed,  based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit committee of registrant's board of directors:

          a)   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

          b)   any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

                                       19
<PAGE>

     6.   The registrant's other certifying officer and I have indicated in this
          quarterly  report whether there were  significant  changes in internal
          controls or in other factors that could significantly  affect internal
          controls  subsequent  to the  date  of  our  most  recent  evaluation,
          including   any   corrective   actions  with  regard  to   significant
          deficiencies and material weaknesses.



November 14, 2002
                                            /s/Darryl W. Thompson
                                            -----------------------------
                                            Darryl W. Thompson
                                            President, Chief Executive Officer







                                       20
<PAGE>

Form 10-Q
                                 CERTIFICATIONS


I, Ron D. Kessinger, certify that:

     1.   I have reviewed this  quarterly  report on Form 10-Q of Triad Guaranty
          Inc.;

     2.   Based on my  knowledge,  this  quarterly  report  does not contain any
          untrue  statement of a material  fact or omit to state a material fact
          necessary to make the statements  made, in light of the  circumstances
          under which such  statements were made, not misleading with respect to
          the period covered by this quarterly report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this quarterly report,  fairly present in all
          material respects the financial  condition,  results of operations and
          cash flows of the  registrants as of,  and for, the periods  presented
          in this quarterly report;

     4.   The registrant's  other  certifying  officer and I are responsible for
          establishing  and maintaining  disclosure  controls and procedures (as
          defined in Exchange  Act Rules  13a-14 and 15d-14) for the  registrant
          and have:

          a)   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the registrant,  including its
               consolidated  subsidiaries,  is made known to us by others within
               those  entities,  particularly  during  the  period in which this
               quarterly report is being prepared;

          b)   evaluated  the  effectiveness  of  the  registrant's   disclosure
               controls and  procedures as of a date within 90 days prior to the
               filing date of this quarterly report (the "Evaluation Date"); and

          c)   presented  in this  quarterly  report our  conclusions  about the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   The registrant's other certifying officer and I have disclosed,  based
          on our most recent  evaluation,  to the registrant's  auditors and the
          audit committee of registrant's board of directors:

          a)   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  registrant's  auditors any material
               weaknesses in internal controls; and

          b)   any fraud,  whether or not material,  that involves management or
               other employees who have a significant  role in the  registrant's
               internal controls; and

                                       21
<PAGE>


     6.   The registrant's other certifying officer and I have indicated in this
          quarterly  report whether there were  significant  changes in internal
          controls or in other factors that could significantly  affect internal
          controls  subsequent  to the  date  of  our  most  recent  evaluation,
          including   any   corrective   actions  with  regard  to   significant
          deficiencies and material weaknesses.



November 14, 2002
                                           /s/ Ron D. Kessinger
                                           ------------------------
                                           Ron D. Kessinger
                                           Executive Vice President and
                                           Chief Financial Officer










                                       22
<PAGE>

                             Triad Guaranty Inc.


                   Certification of Periodic Financial Report
                       Pursuant to 18 U.S.C. Section 1350

     Pursuant to 18 U.S.C.  Section 1350, as adopted  pursuant to Section 906 of
the  Sarbanes-Oxley  Act of  2002,  each of the  undersigned  officers  of Triad
Guaranty Inc. Corporation (the "Company") certifies that, to his knowledge,  the
Quarterly Report on Form 10-Q of the Company for the quarter ended September 30,
2002 fully  complies  with the  requirements  of  Section  13(a) or 15(d) of the
Securities  Exchange  Act of 1934 and  information  contained  in that Form 10-Q
fairly presents,  in all material respects,  the financial condition and results
of operations of the Company.



Dated: November 14, 2002
                                            /s/ Darryl W. Thompson
                                            --------------------------
                                            Darryl W. Thompson
                                            President, Chief Executive Officer



Dated: November 14, 2002
                                            /s/ Ron D. Kessinger
                                            --------------------------
                                            Ron D. Kessinger
                                            Executive Vice-President and
                                            Chief Financial Officer



     This  certification  is made  solely for the  purpose of 18 U.S.C.  Section
1350, subject to the knowledge standard contained therein, and not for any other
purpose.







                                       23