MBIA Reports Lower Full-Year 2025 Losses as PREPA Exposure Narrows

MBIA Inc. outlined full-year and fourth-quarter 2025 results during an earnings call held on 27 February 2026, highlighting reduced annual net losses and a continued effort to resolve exposure to Puerto Rico Electric Power Authority (PREPA) obligations.

The discussion was led by Chief Executive Officer William Charles Fallon and Chief Financial Officer Joseph Ralph Schachinger. The company also issued its standard safe-harbor statement, reminding listeners that actual outcomes could differ from forward-looking comments because of market or competitive factors. Risk disclosures remain available in MBIA’s Form 10-K filings.

Lower Net Losses for 2025

For the twelve months ended 31 December 2025, MBIA posted a smaller net loss compared with 2024. Management attributed the improvement largely to the performance of its subsidiary National Public Finance Guarantee Corporation, commonly referred to as National. National recorded a benefit in losses and loss-adjustment expenses (LAE) in 2025, reversing the incurred losses reported in the prior year.

The main driver was the sale of a custodial receipt tied to National’s PREPA bankruptcy claims. The receipt was sold at a price above the insurer’s previous loss assumptions, prompting a positive adjustment to loss estimates. In addition, National reduced its projected losses on the remaining US$425 million of PREPA gross par outstanding, further supporting the year-over-year comparison.

Focus on PREPA Resolution

Fallon reiterated that resolving PREPA exposure remains the company’s top priority. Progress has stalled, however, because of litigation involving the membership of Puerto Rico’s Financial Oversight and Management Board. Until those legal issues are settled, MBIA does not expect meaningful movement in restructuring discussions.

Aside from PREPA, credits across National’s insured portfolio are performing largely in line with expectations, according to management.

Portfolio Trends and Capital Position

National’s insured portfolio continued to wind down during the year. Gross par outstanding fell by roughly US$3 billion, reaching about US$22 billion at 31 December 2025. The decline contributed to a lower leverage ratio: gross par to statutory capital improved to 24-to-1, compared with 28-to-1 at year-end 2024.

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As of the close of 2025, National reported total claims-paying resources of US$1.4 billion. Statutory capital and surplus exceeded US$900 million, figures that management said underscore the insurer’s ability to meet potential future obligations.

Safe-Harbor Reminder

During the call, MBIA again encouraged investors to consider the inherent uncertainty of forward-looking statements. The company noted that factors such as general economic conditions, market volatility, and competitive pressures could cause actual results to diverge from current projections. MBIA’s comprehensive list of risk factors is available through the U.S. Securities and Exchange Commission.

Outlook

Management did not provide detailed earnings guidance but emphasized continued attention to PREPA negotiations and diligent management of the remaining insured portfolio. The company stated it would update investors once legal matters affecting the oversight board are resolved and substantive restructuring dialogue resumes.

The call concluded with a question-and-answer session, during which executives reiterated the key points: lower full-year losses, an improved leverage ratio, and sufficient claims-paying resources. No timetable was offered for a final PREPA settlement.