Core Viewpoint - MBIA shares experienced a significant rally of 10.3% in the last trading session, closing at $7.6, following a period of 8.5% loss over the past four weeks, indicating notable trading volume and interest in the stock [1] Group 1: Company Performance - MBIA is benefiting from reduced losses and LAE related to National's PREPA exposure, with a focus on resolving this exposure [2] - The company reported a decline in net investment income due to a lower average invested asset base, primarily from dividend payments to National's ultimate parent [2] - The topline performance was positively influenced by favorable changes from net realized investment losses and revenues from consolidated VIEs [2] Group 2: Earnings Expectations - The upcoming quarterly report is expected to show a loss of $0.05 per share, reflecting a year-over-year change of +89.6%, with revenues projected at $20 million, down 31% from the previous year [3] - The consensus EPS estimate for MBIA has remained unchanged over the last 30 days, suggesting that stock price movements may not sustain without trends in earnings estimate revisions [4] Group 3: Industry Context - MBIA holds a Zacks Rank of 3 (Hold) within the Zacks Insurance - Multi line industry, while Fidelis Insurance Holdings, another company in the same sector, closed 0.8% higher at $19.27 and has returned 3% over the past month [5] - Fidelis Insurance's consensus EPS estimate has also remained unchanged at $0.93, representing a year-over-year change of +188.6%, but it currently holds a Zacks Rank of 4 (Sell) [6]

Financial Data and Key Metrics Changes - The company reported a consolidated GAAP net loss of $8 million, or a negative $0.17 per share for Q3 2025, compared to a net loss of $56 million, or a negative $1.18 per share for Q3 2024, indicating a significant improvement in financial performance [8][12] - The adjusted net income for Q3 2025 was $51 million, or $1.03 per share, compared to an adjusted net loss of $174,000 for Q3 2024, reflecting a favorable change primarily due to lower losses in LAE [9][10] - The consolidated book value per share as of September 30, 2025, was a negative $43.17, driven by MBIA Insurance Corp's negative book value per share of $52.64 [10] Business Line Data and Key Metrics Changes - National reported statutory net income of $73 million for Q3 2025, up from $19 million in Q3 2024, primarily due to a statutory losses in LAE benefit of $56 million resulting from adjustments to PREPA loss reserves [11] - National's gross PAR amount outstanding declined by approximately $2.1 billion from year-end 2024 to about $23.2 billion as of September 30, 2025 [6][12] - MBIA Insurance Corp reported a statutory net loss of $25 million for Q3 2025, compared to statutory net income of $2 million for Q3 2024, primarily due to statutory losses in LAE [12] Market Data and Key Metrics Changes - National's PREPA exposure now amounts to $425 million of gross PAR outstanding, with bondholders representing about 90% opposing PREPA's proposed confirmation plan [5][6] - Claims-paying resources for National remained consistent at $1.5 billion as of September 30, 2025, while MBIA Insurance Corp's claims-paying resources totaled $326 million [11][12] Company Strategy and Development Direction - The company continues to prioritize resolving National's PREPA exposure, with the path and timing of resolution remaining uncertain [5] - There is a potential for a sale of the company as uncertainty around Puerto Rico has been substantially reduced, with management indicating that they may start a formal process if conditions are favorable [32] - The company is considering the timing of special dividends based on liquidity and the evolution of PREPA [33][34] Management's Comments on Operating Environment and Future Outlook - Management noted that the competitive environment and general market conditions could impact future results, emphasizing the importance of monitoring these factors [3][4] - The management expressed optimism regarding negotiations and the potential for regional agreements following changes in the cooperation agreement [16][18] Other Important Information - The corporate segment had total assets of approximately $650 million as of September 30, 2025, with unencumbered cash and liquid assets totaling $354 million [10][11] - The administrative expense claims litigation related to PREPA has been restarted after a temporary stay [5] Q&A Session Summary Question: Clarification on the cooperation agreement and bondholder voting - Management confirmed that no single bondholder can block a deal due to the cooperation agreement's terms [17] Question: Inquiry about buyback capacity and PREPA payments - Management affirmed that buyback capacity of $71 million is available if needed, and PREPA payments are manageable [20][21] Question: Discussion on the strategic review and potential sale of the company - Management indicated that reduced uncertainty around Puerto Rico makes a sale more feasible, and they would announce if a formal process begins [31][32] Question: Questions regarding bond sale contingencies and buyer identity - Management clarified that the sale of $374 million in bankruptcy claims had no contingencies and involved multiple buyers [38] Question: Inquiry about the oversight board's composition and potential delays - Management noted that the current board is shorthanded due to ongoing litigation, which could delay processes [46][48] Question: Discussion on MBIA's financial status and potential barriers to sale - Management stated that MBIA Insurance Corp is not bankrupt and has substantial surplus, which should not be a barrier to selling the company [50][52]

分组1 - MBIA reported a quarterly loss of $0.15 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.03, marking an earnings surprise of -400.00% [1] - The company posted revenues of $15 million for the quarter ended September 2025, missing the Zacks Consensus Estimate by 28.57%, and down from $31 million in the same quarter last year [2] - The stock has underperformed the market, gaining about 4.8% since the beginning of the year compared to the S&P 500's gain of 16.5% [3] 分组2 - The current consensus EPS estimate for the coming quarter is -$0.01 on $21 million in revenues, and for the current fiscal year, it is -$0.37 on $82 million in revenues [7] - The Zacks Industry Rank for Insurance - Multi line is in the top 36% of over 250 Zacks industries, indicating that the industry outlook can significantly impact stock performance [8]

Financial Performance - Net income attributable to MBIA Inc. for the three months ended September 30, 2025, was a loss of $8 million, compared to a loss of $56 million in the same period of 2024, showing an improvement of approximately 86%[15] - Total revenues for the three months ended September 30, 2025, were $15 million, down from $29 million in the same period of 2024, a decrease of approximately 48%[15] - The company reported a net loss per common share of $0.17 for the three months ended September 30, 2025, compared to a loss of $1.18 per share in the same period of 2024[15] - The company reported a net income loss of $126 million for the nine months ended September 30, 2025, an improvement from a loss of $393 million in 2024[22] - The net income (loss) attributable to MBIA Inc. for the nine months ended September 30, 2025, was a loss of $126 million, compared to a loss of $396 million for the same period in 2024[168] - For the three months ended September 30, 2025, the net income from continuing operations available to common shareholders was a loss of $7 million, compared to a loss of $51 million for the same period in 2024[168] Revenue and Expenses - Premiums earned for the three months ended September 30, 2025, totaled $7 million, down from $9 million in the same period of 2024, a decrease of about 22%[15] - Total expenses for the three months ended September 30, 2025, were $22 million, compared to $80 million for the same period in 2024[151][155] - For the three months ended September 30, 2025, gross expenses in the U.S. public finance insurance segment were $8 million, a decrease of 11% from $9 million in 2024[210] - For the nine months ended September 30, 2025, gross expenses totaled $29 million, down 6% from $31 million in 2024[210] - Total insurance operating expenses for the three months ended September 30, 2025, were $10 million, reflecting a 9% decrease from $11 million in 2024[210] - For the nine months ended September 30, 2025, total insurance operating expenses were $34 million, a decline of 6% compared to $36 million in 2024[210] Assets and Liabilities - Total assets decreased to $2,060 million as of September 30, 2025, from $2,168 million at December 31, 2024, representing a decline of approximately 5%[13] - Total liabilities slightly decreased to $4,227 million from $4,244 million, a reduction of about 0.4%[13] - Total shareholders' equity of MBIA Inc. decreased to $(2,180) million as of September 30, 2025, from $(2,089) million at December 31, 2024[13] - The company’s cash and cash equivalents decreased to $64 million as of September 30, 2025, from $84 million at December 31, 2024, a decline of approximately 24%[13] - Total assets held for sale as of September 30, 2025, were $10 million, a decrease from $11 million at the end of 2024[35] - Total liabilities held for sale remained unchanged at $7 million as of September 30, 2025, compared to December 31, 2024[35] Investment Income and Losses - Net investment income decreased to $17 million for the three months ended September 30, 2025, from $20 million in the same period of 2024, a decline of 15%[15] - The company recorded $14 million in losses from fair valuing investments for the three months ended September 30, 2025, compared to $3 million in gains for the same period of 2024[186] - The company experienced a net loss of $25 million on financial instruments at fair value for the nine months ended September 30, 2025, compared to a loss of $63 million in 2024[118] - The net gains (losses) on financial instruments at fair value and foreign exchange for the three months ended September 30, 2025, were reported as a loss of $20 million, compared to a loss of $6 million in 2024[116] Insurance and Claims - Losses and loss adjustment expenses for the three months ended September 30, 2025, were $50 million, compared to a gain of $11 million in the same period of 2024[15] - The company experienced a significant change in loss and loss adjustment expense reserves, with a decrease of $83 million in the nine months ended September 30, 2025[22] - The insurance loss recoverable decreased by 90% to $17 million as of September 30, 2025, from $165 million as of December 31, 2024[208] - Loss and LAE reserves decreased by 30% to $208 million as of September 30, 2025, compared to $299 million as of December 31, 2024[208] Segment Performance - Total revenues for the three months ended September 30, 2025, were $15 million from U.S. Public Finance Insurance, $6 million from Corporate, and $4 million from International and Structured Finance, totaling $25 million[151] - Total revenues for the three months ended September 30, 2024, were $20 million from U.S. Public Finance Insurance, $6 million from Corporate, and $6 million from International and Structured Finance, totaling $33 million[155] - For the nine months ended September 30, 2025, total revenues were $41 million from U.S. Public Finance Insurance, $17 million from Corporate, and $14 million from International and Structured Finance, totaling $72 million[159] - For the nine months ended September 30, 2024, total revenues were $55 million from U.S. Public Finance Insurance, $22 million from Corporate, and $21 million from International and Structured Finance, totaling $98 million[163] Economic Environment - The economic environment indicates that U.S. economic activity is expanding at a moderate pace, with the unemployment rate remaining low and inflation elevated[179] - The Federal Open Market Committee lowered its federal funds rate target range to 3.75% to 4.00%[179] Tax and Deferred Assets - The company recorded a full valuation allowance against its net deferred tax asset of $1.4 billion as of September 30, 2025[141] - The effective tax rate for the three and nine months ended September 30, 2025, was below the U.S. statutory tax rate of 21% due to a full valuation allowance on the changes in the net deferred tax asset[190] Other Notable Points - The company does not expect to write new financial guarantee policies outside of remediation-related activities[178] - The company continues to monitor its insured portfolio, particularly regarding potential defaults from state and local governments experiencing financial stress[202] - The company has a maximum commitment of approximately $15 million for a delayed draw term loan, which was fully drawn and outstanding as of September 30, 2025[175]

Core Viewpoint - MBIA Inc. will host a webcast and conference call on November 5, 2025, at 8:00 a.m. (ET) to discuss its third quarter financial results and other company-related issues [1] Company Information - The dial-in number for the conference call is 800-445-7795 for U.S. participants and 785-424-1699 for international participants [1] - The conference call code is MBIAQ325 [1] - A live webcast of the conference call will be available on the company's website www.mbia.com [1]

Financial Data and Key Metrics Changes - The company reported a consolidated GAAP net loss of $56 million or a negative $1.12 per share for Q2 2025, compared to a consolidated GAAP net loss of $254 million or a negative $5.34 per share for Q2 2024, indicating a significant improvement in financial performance [9][10] - The adjusted net loss for Q2 2025 was $8 million or a negative $0.17 per share, compared to an adjusted net loss of $138 million or a negative $2.90 per share for Q2 2024, reflecting lower losses in LAE [11] - Book value per share decreased by $2.15 to a negative $43.14 as of June 30, 2025, from a negative $40.99 as of December 31, 2024, primarily due to the consolidated net loss [12] Business Line Data and Key Metrics Changes - National reported statutory net income of $6 million for 2025, compared to a statutory net loss of $131 million for 2024, driven by lower losses in LAE related to PREPA exposure [14] - MBIA Insurance Corp reported statutory net income of $4 million for 2025, compared to a statutory net loss of $35 million for 2024, also due to lower losses in LAE [15] Market Data and Key Metrics Changes - The gross par amount outstanding for National's insured portfolio declined by approximately $1.1 billion from year-end 2024 to about $24 billion as of June 30, 2025 [7] - National's leverage ratio of gross par to statutory capital was 26 to 1 at the end of Q2 2025, with total claims paying resources of $1.5 billion [8] Company Strategy and Development Direction - The company continues to prioritize resolving National's PREPA exposure, with the timing of resolution remaining uncertain, and believes that reducing uncertainty regarding PREPA is essential for maximizing shareholder value [7] - The transfer of $374 million of claims to a custodian is seen as a move to enhance marketability and facilitate potential sales of those claims [20][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism that the recent changes in the Puerto Rico oversight board could lead to a more favorable environment for reaching a consensual deal regarding PREPA [25][26] - The company is cautious about speculating on the impact of the oversight board changes until more information is available regarding new board members and their approach [25][26] Other Important Information - The corporate segment had total assets of approximately $677 million as of June 30, 2025, with unencumbered cash and liquid assets totaling $355 million [13] - The company has ongoing discussions regarding a cooperation agreement with Azure and GoldenTree, which is set to expire at the end of the year [42] Q&A Session Summary Question: Can the transfer of PREPA bankruptcy claims to a custodian be interpreted as a signal that the company is marketing those claims? - Management confirmed that $374 million of claims were transferred to a custodian to enhance marketability, making them effectively securities [20][22] Question: How does the recent dismissal of oversight board members impact restructuring negotiations? - Management stated that it is difficult to assess the impact until new board members are appointed and their approach is known, but there is hope for a positive outcome [25][26] Question: Is the cooperation agreement with Azure and GoldenTree still set to expire at the end of the year? - Management confirmed that the agreement will expire at the end of the year, but discussions are ongoing regarding its implications [42] Question: What is the current outstanding exposure related to PREPA? - As of June 30, the outstanding exposure was reported at $504 million, with a payment of approximately $91 million made on July 1 [45] Question: How does the company view the recent changes in the oversight board regarding bondholder interests? - Management noted that while they have not heard specific statements from the president regarding Puerto Rico, the changes are viewed positively and may facilitate a faster resolution [78]

[PART I FINANCIAL INFORMATION](index=5&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents MBIA Inc.'s unaudited consolidated financial statements, including balance sheets, statements of operations, comprehensive income, changes in equity, and cash flows, along with detailed explanatory notes [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20and%20December%2031%2C%202024%20(Unaudited)) Consolidated Balance Sheets (in millions) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Total investments | $1,547 | $1,655 | | Cash and cash equivalents | 165 | 84 | | Premiums receivable | 129 | 133 | | Deferred acquisition costs | 25 | 27 | | Insurance loss recoverable | 185 | 185 | | Assets held for sale | 11 | 11 | | Other assets | 37 | 42 | | Assets of consolidated variable interest entities: | | | | Cash | 2 | 3 | | Loans receivable at fair value | 33 | 28 | | **Total assets** | **$2,134** | **$2,168** | | **Liabilities and Equity** | | | | **Liabilities:** | | | | Unearned premium revenue | $186 | $199 | | Loss and loss adjustment expense reserves | 526 | 526 | | Long-term debt | 2,814 | 2,741 | | Medium-term notes | 454 | 440 | | Investment agreements | 203 | 204 | | Liabilities held for sale | 7 | 7 | | Other liabilities | 67 | 78 | | Liabilities of consolidated variable interest entities: | | | | Variable interest entity debt | 32 | 43 | | Derivative liabilities | 10 | 6 | | **Total liabilities** | **$4,299** | **$4,244** | | **Equity:** | | | | Common stock | 283 | 283 | | Additional paid-in capital | 2,453 | 2,492 | | Retained earnings (deficit) | (1,709) | (1,591) | | Accumulated other comprehensive income (loss) | (96) | (128) | | Treasury stock, at cost | (3,109) | (3,145) | | Total shareholders' equity of MBIA Inc. | (2,178) | (2,089) | | Preferred stock of subsidiary | 13 | 13 | | **Total equity** | **(2,165)** | **(2,076)** | | **Total liabilities and equity** | **$2,134** | **$2,168** | [Consolidated Statements of Operations](index=6&type=section&id=Consolidated%20Statements%20of%20Operations%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(Unaudited)) Consolidated Statements of Operations (in millions, except share and per share amounts) | | Three Months Ended June 30, | | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Revenues** | | | | | | Premiums earned | $7 | $8 | $15 | $17 | | Net investment income | 19 | 22 | 37 | 45 | | Net realized investment gains (losses) | (1) | (2) | (6) | (3) | | Net gains (losses) on financial instruments at fair value and foreign exchange | (2) | (55) | (17) | (51) | | Fees and reimbursements | - | 1 | 1 | 1 | | Other net realized gains (losses) | - | 2 | - | 5 | | Revenues of consolidated variable interest entities: | | | | | | Net gains (losses) on financial instruments at fair value and foreign exchange | - | 1 | - | (24) | | Other net realized gains (losses) | - | (14) | 7 | (14) | | **Total revenues** | **23** | **(37)** | **37** | **(24)** | | **Expenses** | | | | | | Losses and loss adjustment | 8 | 142 | 16 | 160 | | Amortization of deferred acquisition costs | 1 | 1 | 2 | 2 | | Operating | 18 | 15 | 34 | 40 | | Interest | 48 | 53 | 98 | 105 | | Expenses of consolidated variable interest entities: | | | | | | Operating | 3 | 5 | 4 | 9 | | Interest | 1 | - | 1 | - | | **Total expenses** | **79** | **216** | **155** | **316** | | Income (loss) from continuing operations before income taxes | (56) | (253) | (118) | (340) | | Provision (benefit) for income taxes | - | - | - | - | | Income (loss) from continuing operations | (56) | (253) | (118) | (340) | | Income (loss) from discontinued operations, net of income taxes | - | (2) | - | (1) | | **Net income (loss)** | **(56)** | **(255)** | **(118)** | **(341)** | | Less: Net income from discontinued operations attributable to noncontrolling interest | - | (1) | - | (1) | | **Net income (loss) attributable to MBIA Inc.** | **$(56)** | **$(254)** | **$(118)** | **$(340)** | | **Net income (loss) per common share attributable to MBIA Inc. - basic and diluted** | | | | | | Continuing operations | $(1.12) | $(5.30) | $(2.40) | $(7.20) | | Discontinued operations | - | (0.04) | - | (0.01) | | **Net income (loss) per common share attributable to MBIA Inc. - basic and diluted** | **$(1.12)** | **$(5.34)** | **$(2.40)** | **$(7.21)** | | Weighted average number of common shares outstanding | | | | | | Basic | 49,543,258 | 47,501,248 | 48,952,068 | 47,161,085 | | Diluted | 49,543,258 | 47,501,248 | 48,952,068 | 47,161,085 | [Consolidated Statements of Comprehensive Income (Loss)](index=7&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(Unaudited)) Consolidated Statements of Comprehensive Income (Loss) (in millions) | | Three Months Ended June 30, | | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | Net income (loss) attributable to MBIA Inc. | $(56) | $(254) | $(118) | $(340) | | Other comprehensive income (loss): | | | | | | Available-for-sale securities with no credit losses: | | | | | | Unrealized gains (losses) arising during the period | 1 | (11) | 18 | (26) | | Reclassification adjustments for (gains) losses included in net income (loss) | - | 2 | 7 | 2 | | Foreign currency translation: | | | | | | Reclassification adjustments for (gains) losses included in net income (loss) | - | - | 5 | - | | Instrument-specific credit risk of liabilities measured at fair value: | | | | | | Unrealized gains (losses) arising during the period | 2 | (6) | 2 | (2) | | Reclassification adjustments for (gains) losses included in net income (loss) | - | 9 | - | 28 | | **Total other comprehensive income (loss)** | **3** | **(6)** | **32** | **2** | | **Comprehensive income (loss)** | **$(53)** | **$(260)** | **$(86)** | **$(338)** | [Consolidated Statements of Changes in Shareholders' Equity](index=8&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(Unaudited)) Consolidated Statements of Changes in Shareholders' Equity (in millions except share amounts) | | Three Months Ended June 30, | | Six Months Ended June 30, | | :--- | :--- | :--- | :--- | :--- | | | **2025** | **2024** | **2025** | **2024** | | **Common shares** | | | | | | Balance at beginning and end of period | 283,186,115 | 283,186,115 | 283,186,115 | 283,186,115 | | **Common stock amount** | | | | | | Balance at beginning and end of period | $283 | $283 | $283 | $283 | | **Additional paid-in capital** | | | | | | Balance at beginning of period | $2,460 | $2,486 | $2,492 | $2,515 | | Share-based compensation | (7) | (3) | (39) | (32) | | Balance at end of period | $2,453 | $2,483 | $2,453 | $2,483 | | **Retained earnings (deficit)** | | | | | | Balance at beginning of period | $(1,653) | $(1,230) | $(1,591) | $(1,144) | | Net income (loss) attributable to MBIA Inc. | (56) | (254) | (118) | (340) | | Balance at end of period | $(1,709) | $(1,484) | $(1,709) | $(1,484) | | **Accumulated other comprehensive income (loss)** | | | | | | Balance at beginning of period | $(99) | $(131) | $(128) | $(139) | | Other comprehensive income (loss) | 3 | (6) | 32 | 2 | | Balance at end of period | $(96) | $(137) | $(96) | $(137) | | **Treasury shares** | | | | | | Balance at beginning of period | (232,815,490) | (231,910,363) | (232,215,934) | (232,323,184) | | Other | 117,432 | (248,052) | (482,124) | 164,769 | | Balance at end of period | (232,698,058) | (232,158,415) | (232,698,058) | (232,158,415) | | **Treasury stock amount** | | | | | | Balance at beginning of period | $(3,117) | $(3,141) | $(3,145) | $(3,172) | | Other | 8 | 2 | 36 | 33 | | Balance at end of period | $(3,109) | $(3,139) | $(3,109) | $(3,139) | | **Total shareholders' equity of MBIA Inc.** | | | | | | Balance at beginning of period | $(2,126) | $(1,733) | $(2,089) | $(1,657) | | Period change | (52) | (261) | (89) | (337) | | Balance at end of period | $(2,178) | $(1,994) | $(2,178) | $(1,994) | | **Preferred stock of subsidiary shares** | | | | | | Balance at beginning and end of period | 1,315 | 1,315 | 1,315 | 1,315 | | **Preferred stock of subsidiary and noncontrolling interest held for sale** | | | | | | Balance at beginning of period | $13 | $10 | $13 | $10 | | Period change | - | (1) | - | (1) | | Balance at end of period | $13 | $9 | $13 | $9 | | **Total equity** | **$(2,165)** | **$(1,985)** | **$(2,165)** | **$(1,985)** | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20six%20months%20ended%20June%2030%2C%202025%20and%202024%20(Unaudited)) Consolidated Statements of Cash Flows (in millions) | | Six Months Ended June 30, | | :--- | :--- | :--- | | | **2025** | **2024** | | **Cash flows from operating activities:** | | | | Premiums, fees and reimbursements received | $8 | $7 | | Investment income received | 25 | 31 | | Financial guarantee losses and loss adjustment expenses paid | (29) | (25) | | Proceeds from recoveries and reinsurance, net of salvage paid to reinsurers | 15 | 4 | | Operating expenses paid and other operating | (42) | (35) | | Other proceeds from consolidated variable interest entities | - | 2 | | Interest paid, net of interest converted to principal | (19) | (24) | | **Net cash provided (used) by operating activities** | **(42)** | **(40)** | | **Cash flows from investing activities:** | | | | Purchases of available-for-sale investments | (173) | (108) | | Sales of available-for-sale investments | 123 | 55 | | Paydowns, maturities and other proceeds of available-for-sale investments | 103 | 117 | | Purchases of investments at fair value | (22) | (68) | | Sales, paydowns, maturities and other proceeds of investments at fair value | 32 | 154 | | Sales, paydowns and maturities (purchases) of short-term investments, net | 74 | 100 | | Other investing | 1 | 3 | | **Net cash provided (used) by investing activities** | **138** | **253** | | **Cash flows from financing activities:** | | | | Principal paydowns of investment agreements | (1) | (1) | | Principal paydowns of medium-term notes | - | (62) | | Proceeds from variable interest entity debt | - | 2 | | Principal paydowns/redemptions of variable interest entity debt | (8) | (57) | | Principal paydowns of long-term debt | - | (1) | | Purchases of treasury stock | (7) | (4) | | **Net cash provided (used) by financing activities** | **(16)** | **(123)** | | **Net increase (decrease) in cash and cash equivalents** | **80** | **90** | | Cash and cash equivalents - beginning of period | 87 | 108 | | **Cash and cash equivalents - end of period** | **$167** | **$198** | | **Reconciliation of net income (loss) to net cash provided (used) by operating activities:** | | | | Net income (loss) | $(118) | $(341) | | Income (loss) from discontinued operations, net of income taxes | - | (1) | | Income (loss) from continuing operations | (118) | (340) | | Adjustments to reconcile net income (loss) from continuing operations to net cash provided (used) by operating activities: | | | | Change in: | | | | Unearned premium revenue | (13) | (16) | | Loss and loss adjustment expense reserves | - | 104 | | Insurance loss recoverable | - | 41 | | Accrued interest payable | 80 | 86 | | Other assets and liabilities | (12) | (6) | | Net realized investment gains (losses) | 6 | 3 | | Net (gains) losses on financial instruments at fair value and foreign exchange | 17 | 75 | | Other net realized (gains) losses | (7) | 9 | | Other operating | 5 | 4 | | Total adjustments to income (loss) from continuing operations | 76 | 300 | | **Net cash provided (used) by operating activities** | **$(42)** | **$(40)** | | **Supplementary Disclosure of Consolidated Cash Flow Information:** | | | | Non-cash financing activities: | | | | Variable interest entity debt extinguishment | $7 | $- | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) [Note 1: Business Developments and Risks and Uncertainties](index=10&type=section&id=Note%201%3A%20Business%20Developments%20and%20Risks%20and%20Uncertainties) - National paid gross claims of **$13 million** on January 1, 2025, and **$92 million** on July 1, 2025, due to PREPA debt service defaults. As of June 30, 2025, National had **$657 million** of insured debt service outstanding related to PREPA[26](index=26&type=chunk)[180](index=180&type=chunk)[299](index=299&type=chunk) - National terminated the PREPA RSA due to the Oversight Board's intent to modify National's settlement in an amended Plan, raising uncertainty about a substantially similar confirmed plan[27](index=27&type=chunk)[184](index=184&type=chunk)[300](index=300&type=chunk) - MBIA Corp. is dissolving its wholly-owned subsidiary, MBIA Mexico, which returned approximately **$12 million** of capital to MBIA Corp. during the six months ended June 30, 2025[30](index=30&type=chunk)[183](index=183&type=chunk) - Significant uncertainty remains regarding the realizable value of remaining loans and equity interests in portfolio companies and the litigation trust from Zohar CDOs[32](index=32&type=chunk) - Assets and liabilities of certain Zohar entities are classified as 'held for sale' and their results as 'discontinued operations'[33](index=33&type=chunk) - MBIA Corp.'s ability to meet obligations is limited by liquidity, and failure to collect expected recoveries could lead to rehabilitation or liquidation proceedings by the NYSDFS[38](index=38&type=chunk)[40](index=40&type=chunk) [Note 2: Significant Accounting Policies](index=15&type=section&id=Note%202%3A%20Significant%20Accounting%20Policies) - Unaudited consolidated financial statements are prepared per Form 10-Q and Article 10 of Regulation S-X, not including all GAAP disclosures for annual periods[44](index=44&type=chunk) - Financial statements rely on management's estimates and assumptions, which may differ from actual results[45](index=45&type=chunk) [Note 3: Recent Accounting Pronouncements](index=15&type=section&id=Note%203%3A%20Recent%20Accounting%20Pronouncements) - No new accounting pronouncements adopted had a material impact on consolidated financial statements[47](index=47&type=chunk) - The company is evaluating the potential impact of ASU 2023-09 (Improvements to Income Tax Disclosures), effective for annual periods after December 15, 2024[48](index=48&type=chunk) - The company is evaluating the potential impact of ASU 2024-03 (Disaggregation of Income Statement Expenses), effective for annual periods after December 15, 2026[49](index=49&type=chunk) [Note 4: Variable Interest Entities](index=17&type=section&id=Note%204%3A%20Variable%20Interest%20Entities) - MBIA consolidates VIEs where it has both the power to direct activities that significantly impact economic performance and the obligation to absorb losses or right to receive benefits[52](index=52&type=chunk) - No additional consolidations or deconsolidations occurred in Q1/Q2 2025. In Q2 2024, one VIE was deconsolidated due to prepayment, resulting in **$14 million** losses (**$9 million** from AOCI)[53](index=53&type=chunk) Maximum Exposure to Loss for Nonconsolidated VIEs (in millions) | In millions | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total insurance in force | $1,255 | $1,425 | | Total investments | $29 | $26 | | Total premiums receivable | $9 | $10 | | Total insurance loss recoverable | $21 | $21 | | Total unearned premium revenue | $7 | $8 | | Total loss and LAE reserves | $231 | $227 | [Note 5: Loss and Loss Adjustment Expense Reserves](index=20&type=section&id=Note%205%3A%20Loss%20and%20Loss%20Adjustment%20Expense%20Reserves) - U.S. public finance loss reserves are estimated using probability-weighted cash flow scenarios, considering debt service and recoveries[58](index=58&type=chunk) - RMBS case basis reserves are calculated using the Roll Rate Methodology, involving loan-level data, internal cash flow models, and commercially available models[61](index=61&type=chunk) Summary of Loss and LAE Reserves and Recoveries (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Total Insurance loss recoverable | $185 | $185 | | Total Loss and LAE reserves | $526 | $526 | | U.S. Public Finance Insurance loss recoverable | $164 | $165 | | U.S. Public Finance Loss and LAE reserves | $295 | $299 | | International and Structured Finance Insurance loss recoverable | $21 | $20 | | International and Structured Finance Loss and LAE reserves | $231 | $227 | - Loss and LAE reserves remained flat at **$526 million** for the six months ended June 30, 2025, with claim payments on PREPA and a U.S. public finance leased-backed transaction partially offset by accretion and lower risk-free rates[68](index=68&type=chunk)[69](index=69&type=chunk) - Insurance loss recoverable remained flat at **$185 million** for the six months ended June 30, 2025, as collections from unwrapped PREPA bonds were offset by reclassification of expected recoveries on a lease-backed transaction, accretion, and a decline in risk-free rates[71](index=71&type=chunk)[72](index=72&type=chunk) Surveillance Categories (June 30, 2025, in millions) | Metric | Total | | :------------------------------------------ | :---- | | Number of policies | 115 | | Number of issues | 84 | | Remaining weighted average contract period (in years) | 5.4 | | Gross insured contractual payments outstanding: Principal | $2,029 | | Gross insured contractual payments outstanding: Interest | $1,694 | | Total Gross insured contractual payments outstanding | $3,723 | | Gross Claim Liability | $872 | | Gross Potential Recoveries | $441 | | Discount, net | $99 | | Net claim liability (recoverable) | $332 | | Unearned premium revenue | $11 | | Reinsurance recoverable on paid and unpaid losses | $16 | [Note 6: Fair Value of Financial Instruments](index=27&type=section&id=Note%206%3A%20Fair%20Value%20of%20Financial%20Instruments) - Investments are classified into Level 1 (quoted active markets), Level 2 (observable inputs), and Level 3 (significant unobservable inputs) of the fair value hierarchy[86](index=86&type=chunk) - As of June 30, 2025, Level 3 assets represented approximately **6%** of total assets measured at fair value, while Level 3 liabilities represented approximately **99%** of total liabilities measured at fair value[103](index=103&type=chunk) Fair Value Measurements at Reporting Date (in millions) | Category | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Total assets measured at fair value | $1,746 | $1,769 | | Level 1 Assets | $781 | $797 | | Level 2 Assets | $854 | $866 | | Level 3 Assets | $101 | $96 | | Total liabilities measured at fair value | $75 | $73 | | Level 1 Liabilities | $0 | $0 | | Level 2 Liabilities | $1 | $1 | | Level 3 Liabilities | $74 | $72 | - The company elected to record certain financial instruments at fair value, including certain equity investments and financial instruments consolidated in connection with VIEs[118](index=118&type=chunk) - Cumulative changes in instrument-specific credit risk of liabilities elected under the fair value option were gains of **$29 million** (June 30, 2025) and **$27 million** (December 31, 2024), reported in AOCI[121](index=121&type=chunk) [Note 7: Investments](index=45&type=section&id=Note%207%3A%20Investments) AFS Investments (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Total AFS investments (Fair Value) | $1,268 | $1,236 | | Total AFS investments (Amortized Cost) | $1,400 | $1,391 | | Gross Unrealized Gains | $6 | $5 | | Gross Unrealized Losses | $(138) | $(160) | AFS Fixed-Maturity Securities by Contractual Maturity (June 30, 2025, in millions) | Maturity | Net Amortized Cost | Fair Value | | :------------------------------------------ | :----------------- | :--------- | | Due in one year or less | $433 | $432 | | Due after one year through five years | $91 | $91 | | Due after five years through ten years | $182 | $162 | | Due after ten years | $379 | $281 | | Mortgage-backed and asset-backed | $315 | $302 | | Total fixed-maturity investments | $1,400 | $1,268 | - Fair value of securities pledged as collateral for investment agreements was **$214 million** at June 30, 2025[127](index=127&type=chunk) - Gross unrealized losses on AFS investments decreased from **$160 million** (Dec 31, 2024) to **$138 million** (June 30, 2025), primarily due to lower interest rates and tighter credit spreads[129](index=129&type=chunk) - The company did not purchase any credit-deteriorated assets or establish an allowance for credit losses for AFS securities for the three and six months ended June 30, 2025 and 2024[133](index=133&type=chunk) Sales of Available-for-Sale Investments (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Proceeds from sales | $61 | $27 | $123 | $55 | | Gross realized gains | $0 | $1 | $1 | $1 | | Gross realized losses | $(1) | $(2) | $(7) | $(3) | [Note 8: Income Taxes](index=49&type=section&id=Note%208%3A%20Income%20Taxes) - The effective tax rate was **0.0%** for both three and six months ended June 30, 2025 and 2024, due to a full valuation allowance on the net deferred tax asset[139](index=139&type=chunk) - A full valuation allowance of **$1.4 billion** was recorded against the net deferred tax asset as of June 30, 2025, and December 31, 2024, due to a three-year cumulative loss[140](index=140&type=chunk) - The company has approximately **$4.4 billion** in Net Operating Losses (NOLs) as of June 30, 2025, expiring between 2026 and 2044, and a **$55 million** foreign tax credit carryforward expiring between 2025 and 2033[143](index=143&type=chunk) - The One Big Beautiful Bill Act (OBBBA), signed July 4, 2025, is not expected to have a material impact on the company's financial results[145](index=145&type=chunk) [Note 9: Business Segments](index=51&type=section&id=Note%209%3A%20Business%20Segments) - MBIA manages three operating segments: U.S. public finance insurance (National), corporate, and international and structured finance insurance (MBIA Corp.)[146](index=146&type=chunk) - The U.S. public finance insurance segment (National) provides unconditional guarantees for U.S. municipal bonds and public purpose projects, with **$24.2 billion** gross insured par outstanding as of June 30, 2025[147](index=147&type=chunk)[201](index=201&type=chunk) - The international and structured finance insurance segment (MBIA Corp.) guarantees non-U.S. public finance and global structured finance obligations, with **$2.2 billion** gross insured par outstanding as of June 30, 2025. It has not written meaningful new business since 2008[149](index=149&type=chunk)[228](index=228&type=chunk) Segment Results: Income (loss) from continuing operations before income taxes (in millions) | Segment | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | U.S. Public Finance Insurance | $7 | $(130) | $7 | $(139) | | Corporate | $(20) | $(4) | $(35) | $(13) | | International and Structured Finance Insurance | $(42) | $(119) | $(89) | $(188) | | Eliminations | $(1) | $0 | $(1) | $0 | | Consolidated | $(56) | $(253) | $(118) | $(340) | [Note 10: Earnings Per Share](index=57&type=section&id=Note%2010%3A%20Earnings%20Per%20Share) - Earnings per share (EPS) is calculated using the two-class method, allocating earnings to common stock and participating securities (unvested restricted stock)[165](index=165&type=chunk) - Unvested restricted stock is excluded from diluted EPS calculation during net loss periods as it would be antidilutive[166](index=166&type=chunk) Net Income (Loss) Per Common Share - Basic and Diluted (in millions except per share amounts) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Continuing operations | $(1.12) | $(5.30) | $(2.40) | $(7.20) | | Discontinued operations | $0.00 | $(0.04) | $0.00 | $(0.01) | | Net income (loss) per share - basic and diluted | $(1.12) | $(5.34) | $(2.40) | $(7.21) | [Note 11: Accumulated Other Comprehensive Income](index=58&type=section&id=Note%2011%3A%20Accumulated%20Other%20Comprehensive%20Income) Accumulated Other Comprehensive Income (AOCI) Balance (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Balance | $(96) | $(128) | Changes in AOCI (6 months ended June 30, 2025, in millions) | Component | Balance, Dec 31, 2024 | Other comprehensive income (loss) before reclassifications | Amounts reclassified from AOCI | Net period other comprehensive income (loss) | Balance, June 30, 2025 | | :------------------------------------------ | :-------------------- | :--------------------------------------------------------- | :----------------------------- | :------------------------------------------ | :--------------------- | | Unrealized Gains (Losses) on AFS Securities, Net | $(150) | $18 | $7 | $25 | $(125) | | Foreign Currency Translation, Net | $(5) | $0 | $5 | $5 | $0 | | Instrument-Specific Credit Risk of Liabilities Measured at Fair Value, Net | $27 | $2 | $0 | $2 | $29 | | Total | $(128) | $20 | $12 | $32 | $(96) | - Total reclassifications from AOCI for the six months ended June 30, 2025, were **$(12) million**, including **$(7) million** from realized gains/losses on AFS securities and **$(5) million** from foreign currency translation due to MBIA Mexico liquidation[169](index=169&type=chunk) [Note 12: Commitments and Contingencies](index=59&type=section&id=Note%2012%3A%20Commitments%20and%20Contingencies) - Ongoing PREPA Title III proceedings are the primary material legal matter. No other material legal proceedings are pending or threatened[171](index=171&type=chunk) - The company exercised its right to terminate its Purchase, New York headquarters lease in August 2025 but executed a partial reinstatement for a portion of the space with an initial term expiring in 2029[173](index=173&type=chunk) Lease Information (June 30, 2025, in millions) | Metric | Amount | | :------------------------------------------ | :----- | | ROU asset | $2 | | Lease liability | $7 | | Weighted average remaining lease term (years) | 3.8 | | Discount rate used for operating leases | 9.5% | | Total future minimum lease payments | $8 | - MBIA Corp. has a fully drawn **$15 million** delayed draw term loan commitment to an entity it holds as an equity investment[175](index=175&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=60&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes the company's financial condition and results, highlighting improved net loss driven by favorable investment fair value changes and reduced loss adjustment expenses - MBIA operates in financial guarantee insurance across U.S. public finance (National), corporate, and international/structured finance (MBIA Corp.) segments. Neither National nor MBIA Corp. is expected to write new financial guarantee policies outside of remediation[177](index=177&type=chunk)[178](index=178&type=chunk) - U.S. economic activity moderated in H1 2025, with low unemployment and elevated inflation. FOMC maintained federal funds rate at **4.25%-4.50%**. Economic trends could impact investment portfolio values and yields, and loss reserves[179](index=179&type=chunk) [OVERVIEW](index=60&type=section&id=OVERVIEW) - National paid **$13 million** in claims on Jan 1, 2025, and **$92 million** on July 1, 2025, due to PREPA defaults. **$657 million** of insured debt service outstanding as of June 30, 2025[180](index=180&type=chunk) - National terminated the PREPA RSA due to the Oversight Board's intent to modify the settlement, creating uncertainty for future plan confirmation[184](index=184&type=chunk) - MBIA Mexico returned **$12 million** capital to MBIA Corp. during H1 2025 as part of its dissolution process[183](index=183&type=chunk) [RESULTS OF OPERATIONS](index=62&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated Financial Results (in millions, except EPS) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Total revenues | $23 | $(37) | $37 | $(24) | | Total expenses | $79 | $216 | $155 | $316 | | Net income (loss) attributable to MBIA Inc. | $(56) | $(254) | $(118) | $(340) | | Net income (loss) per basic and diluted common share | $(1.12) | $(5.34) | $(2.40) | $(7.21) | | Adjusted net income (loss) | $(8) | $(138) | $(16) | $(162) | - Consolidated total revenues increased for the three months ended June 30, 2025, primarily due to favorable changes from fair valuing investments (**$5 million** gains vs. **$59 million** losses in 2024) and consolidated VIE revenues, partially offset by foreign currency losses (**$9 million** vs. **$1 million** gains in 2024) and lower net investment income[186](index=186&type=chunk) - Consolidated total revenues increased for the six months ended June 30, 2025, primarily due to favorable changes from fair valuing investments (**$1 million** gains vs. **$59 million** losses in 2024) and consolidated VIE revenues (**$7 million** gain vs. **$38 million** loss in 2024), partially offset by foreign currency losses (**$13 million** vs. **$4 million** gains in 2024) and lower net investment income[188](index=188&type=chunk) - Consolidated losses and LAE significantly decreased to **$8 million** (3 months) and **$16 million** (6 months) in 2025 from **$142 million** and **$160 million** in 2024, primarily due to favorable changes in PREPA net reserves[187](index=187&type=chunk)[189](index=189&type=chunk) - The effective tax rate remained **0.0%** for both periods due to a full valuation allowance on the net deferred tax asset[190](index=190&type=chunk) [Non-GAAP Adjusted Net Income (Loss)](index=64&type=section&id=Non-GAAP%20Adjusted%20Net%20Income%20(Loss)) - Adjusted net income (loss) is a non-GAAP measure used by management to assess performance and make business decisions, considered a fundamental measure of periodic financial performance[192](index=192&type=chunk) - Adjustments include removing after-tax results of the international and structured finance insurance segment, and adjusting for mark-to-market gains/losses on financial instruments, foreign exchange gains/losses, net realized investment gains/losses, and extinguishment of debt[193](index=193&type=chunk)[198](index=198&type=chunk) Adjusted Net Income (Loss) (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Adjusted net income (loss) | $(8) | $(138) | $(16) | $(162) | | Adjusted net income (loss) per diluted common share | $(0.17) | $(2.90) | $(0.33) | $(3.44) | [Book Value Adjustments Per Share](index=66&type=section&id=Book%20Value%20Adjustments%20Per%20Share) - Management analyzes adjusted book value (ABV) per share by removing the negative book value of MBIA Corp., net unrealized gains/losses on AFS securities, and including net unearned premium revenue in excess of expected losses of National[197](index=197&type=chunk)[202](index=202&type=chunk) GAAP Book Value Per Share (in millions except share and per share amounts) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Total shareholders' equity of MBIA Inc. | $(2,178) | $(2,089) | | Common shares outstanding | 50,488,057 | 50,970,181 | | GAAP book value per share | $(43.14) | $(40.99) | [U.S. Public Finance Insurance Segment](index=67&type=section&id=U.S.%20Public%20Finance%20Insurance%20Segment) - National's gross insured par outstanding was **$24.2 billion** as of June 30, 2025[201](index=201&type=chunk) U.S. Public Finance Insurance Segment Results: Income (loss) from continuing operations before income taxes (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Total revenues | $23 | $23 | $40 | $49 | | Total expenses | $16 | $153 | $33 | $188 | | Income (loss) from continuing operations before income taxes | $7 | $(130) | $7 | $(139) | - For the three and six months ended June 30, 2025, losses and LAE incurred were primarily due to extending the timing of a settlement on the PREPA exposure. In 2024, they were mainly due to changes in PREPA reserves[207](index=207&type=chunk) - National paid **$3.2 billion** in gross claims related to Puerto Rico bonds through June 30, 2025[217](index=217&type=chunk) PREPA Scheduled Gross Debt Service (June 30, 2025, in millions) | Year | Amount | | :------------------------------------------ | :----- | | 2025 (remaining 6 months) | $92 | | 2026 | $57 | | 2027 | $20 | | 2028 | $20 | | 2029 | $89 | | Thereafter | $379 | | Total | $657 | Credit Quality Distribution of National's U.S. Public Finance Outstanding Gross Par Insured (June 30, 2025, in millions) | Rating | Amount | % | | :------------------------------------------ | :----- | :---- | | AAA | $960 | 4.0% | | AA | $10,831 | 44.7% | | A | $8,878 | 36.6% | | BBB | $1,788 | 7.4% | | Below investment grade | $1,757 | 7.3% | | Total | $24,214 | 100.0% | [Corporate Segment](index=74&type=section&id=Corporate%20Segment) Corporate Segment Results: Income (loss) from continuing operations before income taxes (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Total revenues | $14 | $27 | $30 | $58 | | Total expenses | $34 | $31 | $65 | $71 | | Income (loss) from continuing operations before income taxes | $(20) | $(4) | $(35) | $(13) | - Net gains (losses) on financial instruments at fair value and foreign exchange included foreign currency losses of **$9 million** (3 months) and **$13 million** (6 months) in 2025 due to the U.S. dollar weakening against the euro[226](index=226&type=chunk) [International and Structured Finance Insurance Segment](index=76&type=section&id=International%20and%20Structured%20Finance%20Insurance%20Segment) - MBIA Corp.'s total insured gross par outstanding was **$2.2 billion** as of June 30, 2025[228](index=228&type=chunk) International and Structured Finance Insurance Segment Results: Income (loss) from continuing operations before income taxes (in millions) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :------------------------------------------ | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Total revenues | $6 | $(63) | $10 | $(85) | | Total expenses | $48 | $56 | $99 | $103 | | Income (loss) from continuing operations before income taxes | $(42) | $(119) | $(89) | $(188) | - The net loss for the six months ended June 30, 2025, from financial instruments at fair value and foreign exchange was primarily due to the reclassification of foreign currency translation losses from AOCI due to the liquidation of a foreign subsidiary[232](index=232&type=chunk) - Consolidated VIE revenue for the six months ended June 30, 2025, was a gain of **$7 million** from a litigation trust, compared to losses in 2024 primarily from reclassification of credit risk losses due to early redemptions and deconsolidation[233](index=233&type=chunk) - For the three and six months ended June 30, 2025, losses and LAE incurred primarily related to a decrease in risk-free rates used to discount loss reserves and accretion of loss reserves on insured RMBS transactions[234](index=234&type=chunk) Insurance Loss Recoverable and Loss and LAE Reserves (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Insurance loss recoverable | $21 | $20 | | Loss and LAE reserves | $231 | $227 | - As of June 30, 2025, **25%** of the international and structured finance insured portfolio was rated below investment grade, primarily first-lien RMBS exposures[240](index=240&type=chunk) - MBIA Corp. had **$532 million** of first-lien RMBS gross par outstanding as of June 30, 2025[242](index=242&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=81&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) - The company uses a liquidity risk management framework, including cash forecasting and stress-scenario testing, managed on a legal-entity basis[247](index=247&type=chunk) Consolidated Cash Flows (6 months ended June 30, in millions) | Metric | 2025 | 2024 | Percent Change | | :------------------------------------------ | :----- | :----- | :------------- | | Net cash provided (used) by operating activities | $(42) | $(40) | 5% | | Net cash provided (used) by investing activities | $138 | $253 | -45% | | Net cash provided (used) by financing activities | $(16) | $(123) | -87% | | Cash and cash equivalents - end of period | $167 | $198 | -16% | - Net cash used by operating activities increased due to payments for non-qualified deferred compensation and less investment income, partially offset by lower net losses/LAE and interest expense paid[249](index=249&type=chunk) - Net cash provided by investing activities decreased due to higher net proceeds from investment sales in 2024 to fund debt payments[250](index=250&type=chunk) - Net cash used by financing activities decreased due to repurchase of GFL MTNs and early redemption of VIE debt in 2024[251](index=251&type=chunk) - The company's AFS fixed-maturity investment portfolio had a weighted average credit quality rating of **A**, with **95%** investment grade as of June 30, 2025[253](index=253&type=chunk) - National held **$1.2 billion** in cash and investments as of June 30, 2025, and had statutory capital of **$914 million**. It was not in compliance with certain single risk limits, which could prevent new business[258](index=258&type=chunk)[274](index=274&type=chunk)[275](index=275&type=chunk) National Claims-Paying Resources (CPR) (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Policyholders' surplus | $616 | $602 | | Contingency reserves | $298 | $310 | | Statutory capital | $914 | $912 | | Unearned premiums | $196 | $208 | | Present value of installment premiums | $94 | $95 | | Premium resources | $290 | $303 | | Net loss and LAE reserves | $127 | $130 | | Salvage reserves on paid claims | $159 | $162 | | Gross loss and LAE reserves | $286 | $292 | | Total claims-paying resources | $1,490 | $1,507 | - MBIA Corp. held **$230 million** in cash and investments as of June 30, 2025, and had statutory capital of **$92 million**. It had a negative unassigned surplus of **$1.9 billion** and was not in compliance with certain single risk limits. NYSDFS has not approved interest payments on its Surplus Notes since January 2013[267](index=267&type=chunk)[280](index=280&type=chunk)[281](index=281&type=chunk)[283](index=283&type=chunk) MBIA Insurance Corporation Claims-Paying Resources (CPR) (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :------------------------------------------ | :------------ | :---------------- | | Policyholders' surplus | $87 | $83 | | Contingency reserves | $5 | $5 | | Statutory capital | $92 | $88 | | Unearned premiums | $18 | $21 | | Present value of installment premiums | $17 | $20 | | Premium resources | $35 | $41 | | Net loss and LAE reserves | $43 | $57 | | Salvage reserves on paid claims | $176 | $170 | | Gross loss and LAE reserves | $219 | $227 | | Total claims-paying resources | $346 | $356 | [CRITICAL ACCOUNTING ESTIMATES](index=93&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) - The company's most critical accounting estimates, requiring significant judgment, include loss and LAE reserves and the valuation of financial instruments[287](index=287&type=chunk) [RECENT ACCOUNTING PRONOUNCEMENTS](index=93&type=section&id=RECENT%20ACCOUNTING%20PRONOUNCEMENTS) - This section refers to Note 3 for a discussion of new accounting pronouncements and their potential impact on the consolidated financial statements[289](index=289&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=95&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Market risk exposures from interest rates, foreign exchange, and credit spreads are actively managed, with no material changes observed since December 31, 2024 - Market risk exposures include changes in interest rates, foreign exchange rates, and credit spreads affecting investment securities, MTNs, and investment agreement liabilities[290](index=290&type=chunk) - The company minimizes exposure through active portfolio management, ensuring a proper mix of securities and staggering maturities[290](index=290&type=chunk) - No material changes in market risk related to interest rates, foreign exchange rates, and credit spreads were observed since December 31, 2024[290](index=290&type=chunk) [Item 4. Controls and Procedures](index=95&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[291](index=291&type=chunk) - No material changes in the company's internal control over financial reporting occurred during the fiscal quarter[291](index=291&type=chunk) [PART II – OTHER INFORMATION](index=96&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=96&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 12 for a discussion of the company's litigation, primarily the ongoing PREPA Title III proceedings, with no other material legal matters pending - The company's litigation and related matters are discussed in Note 12, primarily focusing on PREPA's Title III proceedings[294](index=294&type=chunk) - There are no other material legal proceedings pending or, to the knowledge of the Company, threatened[294](index=294&type=chunk) [Item 1A. Risk Factors](index=96&type=section&id=Item%201A.%20Risk%20Factors) This section supplements risk factors, highlighting potential increased credit losses on public finance obligations due to fiscal stress, particularly concerning PREPA's bankruptcy-like proceedings - Fiscal stress in state, local, and territorial governments could lead to increased credit losses or impairments on public finance obligations[296](index=296&type=chunk)[297](index=297&type=chunk) - PREPA remains in a bankruptcy-like proceeding under PROMESA. National had **$657 million** of insured debt service outstanding related to PREPA as of June 30, 2025, and paid **$13 million** and **$92 million** in gross claims on January 1 and July 1, 2025, respectively[298](index=298&type=chunk)[299](index=299&type=chunk) - There is no assurance that a plan substantially similar to National's settlement for PREPA will ultimately be confirmed, which could materially adversely affect National's PREPA loss reserves and recoveries[300](index=300&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=98&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company made no equity security repurchases in Q2 2025, under a **$100 million** share repurchase program approved on May 3, 2023 - The company did not purchase any shares in April, May, or June 2025[302](index=302&type=chunk) - A share repurchase program authorizing up to **$100 million** in share repurchases was approved on May 3, 2023[302](index=302&type=chunk) [Item 6. Exhibits](index=99&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the 10-Q report, including CEO and CFO certifications and XBRL documents - Exhibits include CEO and CFO certifications pursuant to Section 302 and Section 906 of the Sarbanes-Oxley Act of 2002[306](index=306&type=chunk) - XBRL documents, including the instance document, taxonomy extension schema, and cover page interactive data file, are filed[306](index=306&type=chunk) [SIGNATURES](index=100&type=section&id=SIGNATURES) - The report was signed by Joseph R. Schachinger, Chief Financial Officer, on August 6, 2025[308](index=308&type=chunk)

FORM 8-K Filing Information This section provides administrative and disclosure details of the Form 8-K filing [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section details the registrant's name, filing date, and registered securities for the Form 8-K filing - **MBIA Inc.** is the registrant[2](index=2&type=chunk) - The report date and earliest event reported is **August 06, 2025**[2](index=2&type=chunk) Registered Securities | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------ | :---------------- | :---------------------------------------- | | Common Stock | MBI | New York Stock Exchange | [Results of Operations and Financial Condition (Item 2.02)](index=3&type=section&id=Results%20of%20Operations%20and%20Financial%20Condition%20(Item%202.02)) MBIA Inc. announced its second quarter 2025 results through a press release and a financial report - MBIA Inc. issued a press release on **August 6, 2025**, detailing Q2 2025 results[7](index=7&type=chunk) - The financial results report is attached as **Exhibit 99.1** and available on the registrant's website[7](index=7&type=chunk) [Regulation FD Disclosure (Item 7.01)](index=3&type=section&id=Regulation%20FD%20Disclosure%20(Item%207.01)) MBIA Inc. will post additional financial and operational information, including a Quarterly Operating Supplement and subsidiary statutory statements, on its website - On **August 6, 2025**, MBIA will post a Quarterly Operating Supplement for Q2 2025 and 2025 Quarterly Statements for MBIA Insurance Corporation and National Public Finance Guarantee Corporation on its website[9](index=9&type=chunk) - The Company's insured portfolios as of **June 30, 2025**, will also be posted under the 'Insured Portfolio' section[9](index=9&type=chunk) [Financial Statements and Exhibits (Item 9.01)](index=3&type=section&id=Financial%20Statements%20and%20Exhibits%20(Item%209.01)) This section lists the exhibits filed with the Form 8-K, primarily the Second Quarter 2025 Financial Results and the interactive data file - Exhibit 99.1: Second Quarter 2025 Financial Results issued by MBIA Inc., dated **August 6, 2025**[10](index=10&type=chunk) - Exhibit 104: Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document[10](index=10&type=chunk) [Signatures](index=4&type=section&id=Signatures) The report was officially signed on behalf of MBIA Inc. by its Co-General Counsel, William J. Rizzo, on August 6, 2025 - The report was signed by **William J. Rizzo**, Co-General Counsel of MBIA Inc., on **August 6, 2025**[14](index=14&type=chunk) Second Quarter 2025 Financial Results Highlights This section summarizes MBIA Inc.'s consolidated GAAP and non-GAAP financial performance, along with book value per share, for Q2 and H1 2025 [Consolidated GAAP Results](index=5&type=section&id=Consolidated%20GAAP%20Results) MBIA Inc. reported a significant reduction in its consolidated GAAP net loss for both the second quarter and the first six months of 2025 compared to the prior year periods [Quarterly Performance (Q2 2025 vs Q2 2024)](index=5&type=section&id=Quarterly%20Performance%20(Q2%202025%20vs%20Q2%202024)) For the second quarter of 2025, MBIA Inc. recorded a GAAP net loss of $56 million, a substantial improvement from the $254 million net loss in Q2 2024 Consolidated GAAP Net Loss (Q2 YoY) | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | Change (Favorable) (million USD) | | :-------- | :-------------------- | :-------------------- | :------------------------------- | | Net Loss | $(56) | $(254) | $(198) | | Per Share | $(1.12) | $(5.34) | $(4.22) | - The favorable variance was primarily due to lower losses and loss adjustment expenses (LAE) at National Public Finance Guarantee Corporation (National) and lower investment and Variable Interest Entity (VIE) losses at MBIA Insurance Corporation (MBIA Corp.)[15](index=15&type=chunk) - Lower losses and LAE at National largely resulted from a decrease in losses on its Puerto Rico Electric Power Authority (PREPA) exposure[15](index=15&type=chunk) [Year-to-Date Performance (H1 2025 vs H1 2024)](index=5&type=section&id=Year-to-Date%20Performance%20(H1%202025%20vs%20H1%202024)) For the first six months of 2025, the consolidated GAAP net loss was $118 million, a significant improvement from $340 million in H1 2024 Consolidated GAAP Net Loss (H1 YoY) | Metric | H1 2025 (million USD) | H1 2024 (million USD) | Change (Favorable) (million USD) | | :-------------- | :-------------------- | :-------------------- | :------------------------------- | | Net Loss | $(118) | $(340) | $(222) | | Per Diluted Share | $(2.40) | $(7.21) | $(4.81) | - The lower net loss for 2025 was primarily due to higher losses and LAE at National for 2024 associated with its PREPA exposure, greater investment losses at MBIA Corp. for 2024, and greater VIE losses at MBIA Corp. for 2024[19](index=19&type=chunk) [Adjusted Net Income (Loss) (Non-GAAP)](index=5&type=section&id=Adjusted%20Net%20Income%20(Loss)%20(Non-GAAP)) MBIA Inc. reported a substantially lower Adjusted Net Loss (a non-GAAP measure) for both the second quarter and year-to-date periods of 2025 [Quarterly Performance (Q2 2025 vs Q2 2024)](index=5&type=section&id=Quarterly%20Performance%20(Q2%202025%20vs%20Q2%202024)) For Q2 2025, the Adjusted Net Loss was $8 million, a significant improvement from $138 million in Q2 2024 Adjusted Net Loss (Non-GAAP, Q2 YoY) | Metric | Q2 2025 (million USD) | Q2 2024 (million USD) | Change (Favorable) (million USD) | | :---------------- | :-------------------- | :-------------------- | :------------------------------- | | Adjusted Net Loss | $(8) | $(138) | $(130) | | Per Diluted Share | $(0.17) | $(2.90) | $(2.73) | - The lower net loss was primarily due to reduced loss and LAE expense at National largely due to its PREPA exposure[17](index=17&type=chunk) [Year-to-Date Performance (H1 2025 vs H1 2024)](index=6&type=section&id=Year-to-Date%20Performance%20(H1%202025%20vs%20H1%202024)) For the first six months of 2025, the Adjusted Net Loss was $16 million, a substantial improvement from $162 million in H1 2024 Adjusted Net Loss (Non-GAAP, H1 YoY) | Metric | H1 2025 (million USD) | H1 2024 (million USD) | Change (Favorable) (million USD) | | :---------------- | :-------------------- | :-------------------- | :------------------------------- | | Adjusted Net Loss | $(16) | $(162) | $(146) | | Per Diluted Share | $(0.33) | $(3.44) | $(3.11) | - The lower net loss was primarily due to reduced loss and LAE expense at National largely due to its PREPA exposure[20](index=20&type=chunk) [Book Value Per Share](index=5&type=section&id=Book%20Value%20Per%20Share) MBIA Inc.'s book value per share decreased to negative $43.14 as of June 30, 2025, from negative $40.99 at year-end 2024 Book Value Per Share | Date | Book Value Per Share (USD) | | :-------------- | :------------------------- | | June 30, 2025 | $(43.14) | | December 31, 2024 | $(40.99) | - The decrease in book value per share since year-end 2024 was primarily due to the net loss for the first six months of 2025[16](index=16&type=chunk) Segment and Company-Level Financials This section provides a detailed overview of the financial positions and key metrics for MBIA Inc. (Holding Company), National Public Finance Guarantee Corporation, and MBIA Insurance Corporation as of June 30, 2025 [MBIA Inc. (Holding Company)](index=6&type=section&id=MBIA%20Inc.%20(Holding%20Company)) As of June 30, 2025, MBIA Inc. maintained a liquidity position of $355 million and did not repurchase any shares during the second quarter - MBIA Inc.'s liquidity position totaled **$355 million** as of **June 30, 2025**, consisting of cash and cash equivalents and liquid invested assets[21](index=21&type=chunk) - There were no purchases of

Group 1 - Cable One's stock price has decreased by over 90% in recent years [1] - The withdrawal of the dividend in early May resulted in a single-day drop of over 40% [1] - Increased competition from fixed-wireless services is a significant factor contributing to the company's decline [1]

Financial Data and Key Metrics Changes - The company reported a consolidated GAAP net loss of $62 million or a negative $1.28 per share for Q1 2025, compared to a net loss of $86 million or a negative $1.84 per share for Q1 2024, indicating an improvement in financial performance [10][6] - The adjusted net loss for Q1 2025 was $8 million or a negative $0.16 per share, compared to an adjusted net loss of $24 million or a negative $0.52 per share for Q1 2024, reflecting a favorable change primarily due to lower losses in LAE [12][10] - Book value per share decreased by $1.23 to a negative $42.22 as of March 31, 2025, from a negative $40.99 as of December 31, 2024, primarily due to the consolidated net loss [13] Business Line Data and Key Metrics Changes - National reported statutory net income of $4 million for Q1 2025, compared to a statutory net loss of $11 million for Q1 2024, driven by lower losses in LAE related to PREPA exposure [15][16] - MBIA Insurance Corp reported statutory net income of $2 million for Q1 2025, compared to a statutory net loss of $35 million for Q1 2024, also due to lower losses in LAE [16][17] - The gross par amount outstanding for National's insured portfolio declined by approximately $500 million from year-end 2024 to about $25 billion as of March 31, 2025 [7] Market Data and Key Metrics Changes - National's leverage ratio of gross par to statutory capital was 27 to 1 at the end of Q1 2025, with total claims paying resources of $1.5 billion and statutory capital surplus in excess of $900 million [8][7] - Claims paying resources for MBIA Insurance Corp totaled $349 million as of March 31, 2025, down from $356 million at year-end 2024 [18] Company Strategy and Development Direction - The company continues to prioritize resolving National's PREPA exposure, with the path and timing of resolution remaining uncertain, and believes that reducing uncertainty regarding PREPA is essential for maximizing shareholder value [7][6] - The management is optimistic about moving into a different phase regarding PREPA, as various parties are expected to come together to address the situation [24][23] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the complexity of the PREPA situation and emphasized ongoing conversations in Washington, D.C., while expressing cautious optimism about the court schedule moving key litigation issues forward [22][24] - The overall portfolio is performing within expectations, with no significant concerns or further write-offs anticipated outside of the PREPA situation [25][22] Other Important Information - The corporate segment had total assets of approximately $685 million as of March 31, 2025, including $378 million in unencumbered cash and liquid assets [14] Q&A Session Summary Question: What is being done politically to resolve the PREPA situation? - Management highlighted that fixing PREPA is a top priority for Governor Gonzalez and that they are engaged in conversations in D.C. to facilitate resolution [22][23] Question: Are there concerns regarding National's other credits or potential write-offs? - Management confirmed that the portfolio is performing within expectations and that PREPA is the primary focus [25][22]