MBIA Inc.

Second-quarter 2026 consolidated GAAP net loss was $46 million, or a negative $0.91 per share, versus a net loss of $56 million, or a negative $1.12 per share, in the second quarter of 2025. Adjusted net loss was $7 million, or a negative $0.14 per share, compared with $8 million, or a negative $0.17 per share a year ago. MBIA Inc. book value per share was negative $45.58 at June 30, 2026, down $1.31 from year-end 2025, reflecting a consolidated net loss of $86 million in the first six months of 2026. National’s insured gross par outstanding declined to about $20.8 billion, and its leverage ratio improved to 21:1 from 24:1 at year-end 2025. For the holdco, unencumbered cash and liquid assets were $337 million versus $357 million at year-end 2025. Forward-looking guidance was qualitative rather than numeric: management said the biggest priority remains resolving National’s PREPA exposure, noted the latest Oversight Board offer was rejected, and said the probability of a transaction rises as PREPA exposure declines. Management also confirmed $71 million of buyback capacity is still available, but gave no new timetable for capital deployment or a sale process.

William Fallon emphasized that the quarter and year-to-date results compared favorably with the prior year, but the company’s main focus remains PREPA. He described several legal and political developments as potentially helpful catalysts, including progress in litigation, the First Circuit timeline, and uncertainty around the Oversight Board’s composition. His tone was cautious but constructive: he repeatedly said the company is not passive, while also acknowledging that timing remains hard to predict.

Joseph Schachinger walked through the financials, noting the GAAP loss improvement was driven mainly by a reversal of legal expenses in a consolidated VIE tied to Zohar recoveries and by foreign exchange gains versus losses last year. He said the adjusted net loss improved modestly because of slightly lower LAE at National related to PREPA. On liquidity, he highlighted $337 million of unencumbered cash and liquid assets at MBIA Inc., down from $357 million at year-end 2025 due to debt service and operating expenses net of investment income, and said the company continues to manage holdco liquidity carefully. He also cited National statutory net income of $10 million, statutory capital of $968 million, and claims-paying resources of $1.4 billion, plus MBIA Insurance Corp. statutory net income of $27 million, statutory capital of $106 million, and claims-paying resources of $342 million.

Analysts focused heavily on PREPA, asking whether the Oversight Board’s doubled proposal was meaningfully better; Fallon said it was only positive in that it was a substantial increase from the Board’s perspective, but bondholders still viewed it as clearly inadequate. Another major line of questioning concerned capital returns and buybacks: management confirmed $71 million of capacity remains available and said any distribution from National to the holdco would require a more tailored analysis as the portfolio shrinks. Questions also probed the sale process and political risk in insured portfolios; Fallon said a transaction becomes more likely as PREPA exposure declines, and that political trends are already part of the portfolio analysis, though no impairments were taken this quarter on that basis.