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MBIA Announces High Mortgage Exposure

Posted at December 20th, 2007 7:22 pm by Ryan Fiore
Filed under: Bad Credit, Housing Market, Investing in Real Estate, Mortgage Lending

MBIA Inc, the world’s largest bond insurer, announced today that it had guaranteed 8.1 billion dollars of the riskiest mortgage securitiesThe company stated that it had guaranteed 30.6 billion dollars in complex mortgage securities in total. MBIA’s stock fell to a 13-year low on Thursday in its biggest one-day decline ever, bringing its total drop this year to more than 70 percent. The stock, which closed at $19.95 on Thursday, had hit a record high in January.

“We are shocked that management withheld this information for as long as it did,” Morgan Stanley said. “This new disclosure completely changes our view of MBIA being a ‘more conservative underwriter’ relative to Ambac,” the second-largest bond insurer, said a Morgan Stanley report co-written by analysts Ken Zerbe and Yoana Koleva.

MBIA is most vulnerable to guarantees on $8.1 billion of collateralized debt obligations, or CDOs, most of which includes the riskiest debt known as CDO squared, or CDOs backed by other CDOs. MBIA detailed its exposures on its Web site late on Wednesday. The company’s net worth as of Sept. 30 was $6.5 billion.

To read more about MBIA details huge mortgage exposure head on over to Reuters.

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One Response to “MBIA Announces High Mortgage Exposure”

  1. Cassandra Franks Says:
    September 29th, 2008 at 9:12 am

    I was affected by Katrina Hurricane 2005 and after 3 yrs. I’ve been on a payment plan with my mortgage company. Now my loan has been transferred to another mortage company and the notes are so high until I don’t think I’m going to be able to afford these notes..due to my income..I’m behind on all my bills, My hospital bills has been turned over to the collection agencies, and due to not paying on my credit cards..I got sued by 2 and had to struggle and pay those now I’m being sued by credit card company. So, What do I do??? I do need help

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