-MBIA posts Q2 earnings.
BANKING AND CREDIT NEWS-August 8, 2013--MBIA posts Q2 earnings(C)2013 M2 COMMUNICATIONS http://www.m2.com
8 August 2013 -- New York-based financial holding company MBIA Inc (NYSE: MBI) reported adjusted book value per share of USD 29.28 per share at June 30 2013 compared with USD 30.68 per share at December 31 2012.
Adjusted book value per share is a non-GAAP measure. Book value per share was USD 15.63 as of June 30, 2013, compared to USD 16.22 as of December 31, 2012.
MBIA Inc.'s adjusted pre-tax loss (a non-GAAP measure) for Q2 '313 was USD 160 m compared with an adjusted pre-tax loss of USD 152m for the second quarter of 2012.
The greater adjusted pre-tax loss for the three months ended June 30, 2013 compared to the three months ended June 30, 2012 was driven primarily by lower premiums earned, variable interest entity revenues and net investment income, partially offset by decreases in impairments on insured credit derivatives and lower net losses on insured exposures.
ABV and adjusted pre-tax income provide investors with additional views of the company's operating results that management finds useful in measuring financial performance.
The company recorded a net loss of USD 178m, or USD 0.92 per diluted share, for Q2 '13 compared with net income of USD 581m, or USD 2.98 per diluted share, for Q2 '12.
Consolidated total revenues for the three months ended June 30, 2013 included USD 182m of net losses on the fair value of insured derivatives compared with USD 775m of net gains for the same period of 2012.
The net losses on the fair value of insured derivatives in 2013 were principally due to the effects of MBIA Corp.'s nonperformance risk on its derivative liabilities which resulted from a narrowing of its own credit spreads, partially offset by commuting derivatives at prices below fair value the firm said.
MBIA said that net gains on the fair value of insured derivatives in 2012 were principally the effects of MBIA Corp.'s nonperformance risk on its derivative liabilities which resulted from a widening of its own credit spreads, a reduction in the company's recovery rates and the result of commuting derivatives at prices below fair value.
The company is required to adjust the values of its derivative liabilities for the market's perception of its nonperformance risk.
A decrease in the value of the derivative liabilities attributable to an increase in nonperformance risk is reflected as an unrealised gain while an increase in the value of the derivative liabilities attributable to a decline in nonperformance risk is reflected as an unrealized loss in the income statement.
MBIA is a holding company whose subsidiaries provide financial guarantee insurance, as well as related reinsurance, advisory and portfolio services, for the public and structured finance markets, and asset management advisory services. The company services its clients around the globe with offices in New York, Denver, San Francisco, Paris, London, Madrid and Mexico City.
Find out more at www.mbia.com.
1 USD = 0.651377 GBP
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|Publication:||M2 Banking & Credit News (BCN)|
|Article Type:||Financial report|
|Date:||Aug 8, 2013|
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