MBIA (MBI) Q3 2024 earnings summary

Executive summary

• Consolidated GAAP net loss was $56 million ($1.18 per share) for Q3 2024, a significant improvement from a $185 million loss ($3.94 per share) in Q3 2023, mainly due to lower losses and LAE related to PREPA and VIEs.

• Adjusted net loss (non-GAAP) was $174,000 ($0.00 per share) for Q3 2024, compared to $138 million ($2.92 per share) in Q3 2023, reflecting improved operating performance.

• For the nine months ended September 30, 2024, consolidated GAAP net loss was $396 million ($8.37 per share), compared to $353 million ($7.25 per share) in the same period of 2023, primarily due to losses on Zohar CDO recoveries.

• PREPA defaults in January and July 2024 led to $138 million in gross claims paid by National, with $670 million of insured debt service outstanding as of September 30, 2024.

• No new financial guarantee policies expected outside of remediation activities; focus remains on managing existing insured portfolios and maximizing recoveries.

Financial highlights

• Total revenues were $29 million for Q3 2024, up from $8 million in Q3 2023, mainly due to favorable changes in VIE revenues and lower realized investment losses.

• Total expenses decreased to $80 million in Q3 2024 from $193 million in Q3 2023, primarily due to lower losses and loss adjustment expenses related to PREPA.

• Book value per share was negative $39.19 as of September 30, 2024, down from negative $32.56 at year-end 2023, driven by year-to-date net losses.

• Liquidity position totaled $326 million as of September 30, 2024, mainly in cash and liquid assets.

• No share repurchases during the quarter; $71 million remains authorized for buybacks.

Outlook and guidance

• Substantially reduced uncertainty regarding the PREPA outcome is needed before restarting the process to sell the company.

• The company is focused on resolving PREPA-related issues, which are seen as critical for future strategic actions and shareholder value.

• Uncertainty remains regarding the outcome of PREPA's Title III proceedings; National's PREPA loss reserves and recoveries could be materially affected by future court decisions.

• No expectation of new business outside of remediation; focus on surveillance, remediation, and capital management.

• National expected to remain the primary source of dividends to MBIA Inc.; future dividend amounts and timing are uncertain and subject to regulatory approval.