MBIA Reverses Prior-Year Loss - Analyst Blog
04 Mars 2013 - 2:43PM
Zacks
MBIA Inc. (MBI) reported adjusted reported net
income for the quarter was $3.26 per share compared with a net loss
of $3.23 per share in the fourth quarter of 2011. The reversal in
the company results were brought about by changes in the fair value
of insured credit derivatives.
The company reported net income for the quarter was $3.26 per
share compared with a net loss of $3.23 per share in the fourth
quarter of 2011.
Total revenue was $732 million, significantly improved from a
revenue loss of $1.17 billion in the year-ago quarter.
Premiums earned were $141 million, up from $102 million in the
year-ago quarter.
Net investment income was reported at $42 million, down from $84
million in the year-ago quarter.
For the full year 2012, net income was $6.33 per share, compared
with a net loss of $6.69 per share. The reversal in net income was
primarily due to $1.5 billion of net gains on insured credit
derivatives, compared with $2.8 billion of net losses on insured
credit derivatives in 2011.
Segmental Performance
The U.S. Public Finance Insurance segment is
managed by its subsidiary National Public Finance, set up in
February 2009.
Therefore, National virtually wrote no new business. Total
premiums earned in the U.S. public finance insurance segment were
$122 million, up 8% year over year. The increase was due to
refunding premiums earned, partially offset by a decrease in
scheduled premiums earned.
Pretax income was $202 million compared with $163 million in the
prior-year quarter.
The Structured Finance and International
Insurance business operations are managed by MBIA Corp.
While no new business was written in this segment, the existing
business generates the scheduled premiums earned. The segment
suffered an adjusted pre-tax loss of $13 million compared with an
adjusted pre-tax loss of $300 million in the prior-year
quarter.
Premiums earned, net investment income, fee and reimbursements,
and premiums and fees on insured derivatives totaled $115 million
in the quarter.
The Advisory Services are managed by Cutwater
Asset Management. Cutwater recorded a pre-tax loss of $1 million
compared with a pre-tax loss of $9 million in prior-year quarter.
The increase in the pre-tax loss was primarily due to lower fees
from affiliates.
Adjusted book value per share (a non-GAAP measure) declined to
$30.68 per share as of Dec 31, 2012, compared with $34.50 as of Dec
31, 2011.
MBIA Corp.'s statutory capital stood at $1.5 billion at year-end
2012 and claims-paying resources were $5.3 billion.
Other companies in the same industry, Radian Group Inc.
(RDN), Genworth Financial Inc. (GNW) and
MGIC Investment Corporation (MTG) are all
witnessing losses from their mortgage businesses.
GENWORTH FINL (GNW): Free Stock Analysis Report
MBIA INC (MBI): Free Stock Analysis Report
MGIC INVSTMT CP (MTG): Free Stock Analysis Report
RADIAN GRP INC (RDN): Free Stock Analysis Report
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