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MBIA INC. SECOND QUARTER NET INCOME INCREASES 33 PERCENT

 ARMONK, N.Y., Aug. 3 /PRNewswire/ -- MBIA Inc. (NYSE: MBI), the holding company for Municipal Bond Investors Assurance Corporation (MBIA Corporation), today reported that 1993 second quarter net income rose to $63.8 million and $1.50 per share, representing increases of 33 percent and 27 percent compared with the second quarter of 1992.
 For the first half of 1993 net income rose 50 percent to $136.5 million from $91.2 million in the same period in 1992. Earnings per share were $3.22, a 42 percent increase over $2.27 a year ago. The company's 1993 first half results included $12.9 million of net income ($0.30 per share) from the adoption of mandatory accounting changes in the first quarter of this year. Excluding these effects, first half net income rose 36 percent to $123.6 million and earnings per share increased 28 percent to $2.91. Book value per share at the end of June was $35.89, compared with $30.24 at June 30, 1992.
 David H. Elliott, president and chief executive officer of MBIA Inc., said, "MBIA's second quarter financial results reflect our strong underlying earnings growth as operating income per share, excluding the benefit of refundings, rose 20 percent. This year's record premium writings will contribute to higher operating earnings for years to come."
 Mr. Elliott added, "We are optimistic about the outlook for MBIA. Demand for bond insurance continues to be very strong. Furthermore, the improving financial condition of most municipalities will allow them to address the overwhelming need to improve and expand the country's infrastructure."
 New issue municipal volume through June reached an all-time high of $146.7 billion, a 27 percent increase over the first half of 1992. The insured portion of new issue volume increased to 40 percent versus 35 percent in the comparable period last year. New issue municipal bonds insured in the first six months totaled $58.7 billion, an increase of 48 percent over last year's first half.
 MBIA insured $22.5 billion of new issue municipal bonds in the first half of 1993 compared with $14.1 billion a year ago, a 60 percent increase. Based on data from The Bond Buyer, MBIA continued as the nation's leading insurer, accounting for 38 percent of the insured municipal bond market and 15 percent of all new issue municipal volume.
 Gross premiums written for the quarter rose 40 percent to $154.3 million, compared with $110.5 million in the 1992 second quarter. For the first six months of the year, gross premiums totaled $252.3 million, up 38 percent from $183.2 million in the first half of 1992.
 Premiums earned during the second quarter were $58.9 million, a 45 percent increase over the same period in 1992. This included $22.8 million from refundings, compared with $11.8 million for the prior period. For the first six months, premiums earned rose 42 percent to $112.4 million.
 Net investment income, excluding net capital gains, rose 21 percent for the quarter to $44.3 million from $36.6 million in the second quarter of 1992 and grew 22 percent to $87.0 million for the first half compared with $71.4 million in the same period a year ago. At June 30, 1993, MBIA's aggregate investment portfolio was $2.8 billion, consisting almost entirely of fixed income securities of diversified maturities. The average quality remained Double-A.
 Revenues for the second quarter of 1993 rose 34 percent to $108.9 million compared with $81.3 million in the same quarter of 1992. For the first six months of 1993, revenues totaled $209.2 million, also a 34 percent increase over the $156.7 million in last year's first half. Revenues are the sum of earned premiums, investment and other income.
 Total expenses for the second quarter and first half were $26.5 million and $51.5 million, respectively, compared with $20.1 million and $39.3 million in the same periods last year. These increases reflect greater expense recognition from refundings, higher interest expense from additional long-term debt issued in late 1992 to support future growth, and operating expenses for new products.
 Effective the first quarter of 1993, the company adopted three changes in accounting standards. The adoption of Statement of Financial Accounting Standard (SFAS) 109 regarding the calculation of deferred income taxes resulted in increases in net income and earnings per share of $13.0 million and $0.30 respectively. The company also adopted SFAS 106 relating to post-retirement employee benefits which resulted in a charge to net income of $0.1 million. Finally, the company adopted SFAS 113 concerning accounting for reinsurance, which had no income statement impact but which increased both assets ("prepaid reinsurance premiums") and liabilities (unearned premium reserve, now relabeled "deferred premium revenue") by $175.8 million and $164.4 million as of June 30, 1993 and Dec. 31, 1992 respectively.
 Computed on a statutory basis, MBIA Corporation's consolidated unearned premium reserve and loss reserve as of June 30, 1993 were $1.38 billion, and its capital base (consisting of capital, surplus and contingency reserve) was $1.40 billion, for an aggregate $2.78 billion of policyholders' reserves compared with $2.25 billion a year ago.
 MBIA Inc., through its wholly owned subsidiary, MBIA Corporation, is the leading insurer of municipal bonds, including new issues and bonds traded in the secondary market. The company also guarantees asset-backed transactions and high quality obligations offered by qualified financial institutions and provides investment management services for school districts and municipalities. MBIA Corporation has a claims-paying rating of Triple-A from Moody's Investors Service and Standard & Poor's Corporation and all municipal bonds insured by MBIA receive these ratings.
 MBIA INC. AND SUBSIDIARIES
 Consolidated Statements Of Income
 (Unaudited, dollars in thousands except per share amounts)
 Periods ended Three Months Six Months
 June 30 1993 1992 1993 1992
 Revenues:
 Gross premiums written $154,315 $110,460 $252,340 $183,161
 Ceded premiums (20,323) (8,821) (29,159) (17,031)
 Net premiums written 133,992 101,639 223,181 166,130
 Increase in deferred (75,071) (61,093) (110,795) (86,833)
 premium revenue
 Premiums earned 58,921 40,546 112,386 79,297
 Net investment income 44,300 36,570 86,975 71,402
 Net realized gains 2,987 3,390 5,326 4,524
 CLASS management fees 771 541 1,652 1,044
 Other income 1,955 250 2,908 388
 Total revenues 108,934 81,297 209,247 156,655
 Expenses:
 Losses and loss
 adjustment expenses 2,619 1,633 4,156 2,726
 Underwriting and
 operating expenses 9,780 8,723 19,267 16,770
 Policy acquisition
 costs net 6,346 4,219 12,509 8,839
 Interest expense 6,743 4,659 13,462 9,320
 CLASS operating expenses 1,042 867 2,070 1,613
 Total expenses 26,530 20,101 51,464 39,268
 Income before income taxes 82,404 61,196 157,783 117,387
 Provision for income
 taxes 18,563 13,250 34,214 26,228
 Income before cumulative
 effect of accounting
 changes 63,841 47,946 123,569 91,159
 Cumulative effect of
 accounting changes -- -- 12,923 --
 Net income $ 63,841 $ 47,946 $136,492 $ 91,159
 Net income per
 common share $ 1.50 $ 1.18 $ 3.22 $ 2.27
 Weighted average number
 of common shares
 outstanding 42,446,881 40,678,435 42,429,191 40,180,186
 MBIA INC. AND SUBSIDIARIES
 Consolidated Balance Sheets
 (Dollars in thousands except per share amounts)
 6/30/93 12/31/92 6/30/92
 (Unaudited) (Audited) (Unaudited)
 Assets
 Investments:
 Fixed maturity securities
 (market value $2,813,707,
 $2,462,417 and $2,138,661) $2,617,931 $2,346,162 $2,041,374
 Short-term investments 142,621 121,733 157,376
 Other investments 76,921 60,783 44,023
 Total investments 2,837,473 2,528,678 2,242,773
 Cash and cash equivalents 24,980 11,226 11,221
 Accrued investment income 50,040 47,556 41,406
 Deferred acquisition costs 114,326 110,451 103,666
 Prepaid reinsurance premiums 175,834 164,408 163,227
 Goodwill - net 118,813 121,348 123,929
 Property and equipment - net 44,437 40,255 35,721
 Receivable for investments sold 2,348 2,111 3,046
 Other assets 22,833 23,171 18,194
 Total assets $3,391,084 $3,049,204 $2,743,183
 Liabilities and Shareholders' Equity
 Liabilities:
 Deferred premium revenue(A) $1,318,366 $1,196,155
 Loss and loss adjustment
 expense reserves(B) 29,459 25,510 23,670
 Long-term debt 298,625 298,571 198,743
 Current income taxes payable 3,823 544 4,816
 Deferred income taxes 90,479 98,369 91,014
 Payable for investments purchased 83,814 -- 51,545
 Other liabilities 60,310 47,925 48,787
 Total liabilities 1,884,876 1,667,074 1,527,179
 Shareholders' Equity:
 Common stock 41,994 41,960 40,530
 Additional paid-in capital 715,888 713,762 637,208
 Retained earnings 744,208 625,216 545,506
 Cumulative translation adjustment (787) (489) (53)
 Unrealized appreciation - net 5,425 3,556 633
 Treasury stock (520) (1,875) (7,820)
 Total shareholders' equity 1,506,208 1,382,130 1,216,004
 Total liabilities and
 shareholders' equity $3,391,084 $3,049,204 $2,743,183
 Book value per share $ 35.89 $ 33.00 $ 30.24
 (A) -- Formerly labeled unearned
 premiums.
 (B) -- Includes net
 case reserves: $7,200 $14,425 $14,581
 MUNICIPAL BOND INVESTORS ASSURANCE CORPORATION CONSOLIDATED
 (Wholly owned subsidiary of MBIA Inc.)
 Selected Financial Data Computed on a Statutory Basis:
 (dollars in millions)
 6/30/93 12/31/92 6/30/92
 Unaudited) (Audited) (Unaudited)
 Capital and surplus $ 945.4 $ 896.0 $ 745.6
 Contingency reserve 458.4 403.9 355.7
 Capital base 1,403.8 1,299.9 1,101.3
 Unearned premium reserve 1,371.4 1,241.9 1,137.9
 Loss and loss adjustment
 expense reserves 7.2 14.4 14.6
 Total policyholders'
 reserves $2,782.4 $2,556.2 $2,253.8
 -0- 8/3/93
 /CONTACT: Michael C. Ballinger of MBIA, 914-765-3893/
 (MBI)


CO: MBIA, Inc. ST: New York IN: INS SU: ERN

TS -- NY016 -- 8707 08/03/93 08:26 EDT
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Date:Aug 3, 1993
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