MBIA Announces Settlement With Credit Suisse

Rhea-AI Summary

MBIA Inc. (NYSE: MBI) announced a settlement with Credit Suisse Securities (USA) LLC, concluding a litigation that began in 2009. The court awarded MBIA's subsidiary, MBIA Insurance Corporation, approximately $604 million in damages. As part of the settlement, Credit Suisse will pay MBIA Corp. $600 million, significantly exceeding the recovery recorded in MBIA's Q3 2020 financial statements. Following this agreement, the court dismissed the litigation, marking a positive resolution for MBIA and its shareholders.

Positive

• Settlement of $600 million from Credit Suisse exceeds Q3 2020 recovery.
• Court dismissed litigation, providing closure and reducing legal risks.

Negative

• None.

MBIA Inc. (NYSE: MBI) (the Company) today announced that its wholly-owned subsidiary, MBIA Insurance Corporation (MBIA Corp.) has entered into an agreement to settle the litigation it filed in 2009 against Credit Suisse Securities (USA) LLC and certain affiliated entities. The settlement followed a post-trial decision by the Court awarding MBIA Corp. approximately $604mm in damages, and pursuant to the settlement Credit Suisse has paid MBIA Corp. $600mm. This amount materially exceeds the amount of recovery recorded in the Company’s Q3 2020 financial statements. Following the agreement to settle the case, the Court dismissed the action.

MBIA Inc., headquartered in Purchase, New York, is a holding company whose subsidiaries provide financial guarantee insurance for the public and structured finance markets. Please visit MBIA's website at www.mbia.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210211005965/en/

FAQ

What is the significance of MBIA's settlement with Credit Suisse?

The settlement involves a payment of $600 million to MBIA from Credit Suisse, which exceeds previous financial recoveries and reduces ongoing legal risks.

How much did MBIA win in damages from the court ruling?

The court awarded MBIA approximately $604 million in damages.

What was the original litigation against Credit Suisse about?

The litigation filed by MBIA in 2009 involved claims against Credit Suisse related to financial guarantees.

How does the settlement impact MBIA's financial position?

The settlement provides a significant inflow of cash, enhancing MBIA's liquidity and overall financial strength.

When did MBIA announce the settlement with Credit Suisse?

MBIA announced the settlement on February 11, 2021.