MBIA 3Q Loss Narrows; Insurance Losses Bigger Than Expected
Date : 11/09/2009 @ 5:13PM
Source : Dow Jones News
Stock : MBIA Inc. (MBI)
Quote : 4.8 0.45 (10.34%) @ 5:12PM
MBIA 3Q Loss Narrows; Insurance Losses Bigger Than Expected
DOW JONES NEWSWIRES
MBIA Inc.'s (MBI) third-quarter loss narrowed slightly as losses in the insurance business were greater than expected and the housing downturn continued to cause asset losses.
Shares sank 14% to $4.14 in after-hours trading as the bond insurer posted its fifth quarterly loss in the past two years. The stock has lost almost half its value from its 52-week high in September.
In late September, Standard & Poor's Ratings Service cut MBIA's rating to junk status. The company is writing almost no new business, after forming National Public Finance Guarantee Corp. earlier this year to hold its public finance business.
Ambac Financial Group Inc. (ABK), the second-largest U.S. bond insurer, last week swung to a third-quarter profit, but analysts said its bond-insurance business is in danger of falling below legally required capital levels.
For the latest quarter, MBIA reported a loss of $727.8 million, or $3.50 a share, compared with a year-earlier loss of $806.5 million, or $3.42 a share. The latest results included an $810.2 million pretax unrealized loss on insured credit derivatives, $238.8 million in pretax loss and loss adjustment expenses related to second-lien mortgage loan securitizations, and $171.4 million in pre-tax realized losses and other-than-temporary impairments on investments.
MBIA paid $638.4 million in claims in the third quarter.
-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357; Kathy.Shwiff@dowjones.com
