MBIA (MBI) investor relations material

Executive summary

• Reported a consolidated GAAP net loss of $46 million ($0.91 per share) for Q2 2026 and $86 million for the first half, reflecting improved results compared to the prior year, with a focus on resolving PREPA exposure and ongoing litigation in Puerto Rico.

• PREPA exposure reduced by $35 million to $390 million gross par value, with $57 million in gross claims paid in 2026 and $554 million of insured debt service outstanding as of June 30, 2026.

• Several litigations related to PREPA progressed, but bondholders rejected the oversight board's increased $3 billion settlement offer.

• No new financial guarantee policies are expected outside of remediation activities; business is managed across U.S. public finance, corporate, and international/structured finance segments.

• National's insured portfolio continued to perform as expected, with a decline in gross par outstanding and improved leverage ratio.

Financial highlights

• Consolidated GAAP net loss for Q2 2026 was $46 million ($-0.91/share), improved from $56 million ($-1.12/share) in Q2 2025; adjusted net loss (non-GAAP) was $7 million ($-0.14/share), slightly better than $8 million ($-0.17/share) in Q2 2025.

• Book value per share as of June 30, 2026, was $-45.58, down $1.31 from year-end 2025, mainly due to a consolidated net loss of $86 million for the first half of 2026.

• Total revenues were $27 million for Q2 2026 (up from $23 million in Q2 2025), and total expenses were $70 million for Q2 2026 (down from $79 million in Q2 2025).

• Unencumbered cash and liquid assets at the holding company totaled $337 million as of June 30, 2026.

• No share repurchases in Q2 2026; $71 million remains under repurchase authorization.

Outlook and guidance

• PREPA litigation and oversight board composition remain key uncertainties for future resolutions.

• Management expects continued focus on portfolio surveillance, remediation, and maximizing recoveries, especially related to Puerto Rico exposures.

• Debt service payments on PREPA are expected to be $20 million in both 2027 and 2028, indicating a lighter payment schedule ahead.

• Potential for further distributions from National to the holding company will depend on detailed portfolio analysis as the book runs down.

• No material new business is anticipated; future results will depend on resolution of Puerto Rico litigation and recoveries from legacy exposures.