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Loss And Loss Adjustment Expense Reserves | 6 Months Ended
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Jun. 30, 2011
Loss And Loss Adjustment Expense Reserves |
Loss And Loss Adjustment Expense Reserves | Note 5: Loss and Loss Adjustment Expense Reserves Loss and Loss Adjustment Expense ("LAE") Process As of June 30, 2011, the majority of the Company's case basis reserves and insurance loss recoveries were related to insured RMBS transactions, which are discussed below. The Company's case basis reserves do not include estimated losses on policies insuring credit derivatives. Policies insuring credit derivative contracts are accounted for as derivatives and carried at fair value. Refer to "Note 6: Fair Value of Financial Instruments" for additional information about the Company's insured credit derivative contracts. Additionally, refer to "Note 6: Loss and Loss Adjustment Expense Reserves" in the Notes to Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2010 for information about the Company's monitoring of outstanding insured obligations and for a summary of its loss reserving process. RMBS Case Basis Reserves and Recoveries RMBS Reserves The Company's RMBS case basis reserves as of June 30, 2011, which relate to RMBS backed by home equity lines of credit ("HELOCs") and closed-end second mortgages ("CES"), were determined through a process called the "Roll Rate Methodology." The Roll Rate Methodology is a multi-step process using a database of loan level information, a proprietary internal cash flow model, and a commercially available model to estimate expected ultimate cumulative losses on insured bonds. The loss reserve estimates are based on a probability-weighted average of three scenarios of loan losses (base case, stress case, and an additional stress case). In calculating ultimate cumulative losses, the Company estimates the amount of loans that are expected to be "charged-off" (deemed uncollectible by servicers of the transactions) in the future. The Company assumes that such charged-off loans have zero recovery values. "Roll Rate" is defined as the probability that current loans become delinquent and that loans in the delinquent pipeline are charged-off. Generally, Roll Rates are calculated for the previous three months and averaged. The Company assumes that the Roll Rate for 90+ day delinquent loans is 100% except for loans within the additional stress case scenario, where the Company assumes a Roll Rate that is calculated using the actual observed average Roll Rate for 90+ day delinquent loans during the past twelve months. As of June 30, 2011, the Roll Rate used in the Company's additional stress case scenario was 97%. Roll Rates for 30-59 day delinquent loans and 60-89 day delinquent loans are calculated on a transaction-specific basis. The Roll Rates are applied to the amounts in the respective delinquency buckets based on delinquencies as of May 31, 2011 to estimate future losses from loans that are delinquent as of the current reporting period. Roll Rates for loans that are current as of May 31, 2011 ("Current Roll to Loss") are calculated on a transaction-specific basis. A proportion of loans reported current as of May 31, 2011 is assumed to become delinquent every month, at a Current Roll to Loss rate that persists at a high level for a time and subsequently starts to decline. A key assumption in the model is the period of time in which the Company projects high levels of Current Roll to Loss to persist. In the Company's base case, the Company assumes that the Current Roll to Loss begins to decline immediately and continues to decline over the next six months to 25% of their levels as of May 31, 2011. In the stress case, the period of elevated delinquency and loss is extended by six months. In the additional stress case, the Company assumes that the current trends in losses will remain through mid-2012, after which time they will revert to the base case. For example, in the base case, as of May 31, 2011, if 10% of the loans are in the 30-59 day delinquent bucket, and recent performance suggests that 30% of those loans will be charged-off, the Current Roll to Loss for the transaction is 3%. In the base case, it is then assumed that the Current Roll to Loss will reduce linearly to 25% of its original value over the next six months (i.e., 3% will linearly reduce to 0.75% over the six months from June 2011 to December 2011). After that six-month period, the Company further reduces the Current Roll to Loss to 0% by early 2014 with the expectation that the performing seasoned loans and an economic recovery will eventually result in loan performance reverting to historically low levels of default. In the model, the Company assumes that all current loans that become delinquent are "charged-off" after six months of delinquency. In addition, in the Company's loss reserve models for transactions secured by HELOCs, the Company considers borrower draw and prepayment rates. For HELOCs, the current three-month average draw rate is used to project future draws on the line. For HELOCs and transactions secured by fixed-rate CES, the three-month average conditional prepayment rate is used to project voluntary principal prepayments. The current loans generate excess spread which offset the losses and reduce the payments. Cash flows also assume a constant basis spread between floating rate assets and floating rate insured debt obligations (the difference between Prime and LIBOR interest rates, minus any applicable fees). For all transactions, cash flow models consider allocations and other structural aspects of the transactions, including managed amortization periods, rapid amortization periods and claims against MBIA Corp.'s insurance policy consistent with such policy's terms and conditions. For loans that remain current (not delinquent) throughout the projection period, the Company assumes that voluntary prepayments occur at the average rate experienced in the most recent three-month period. In developing multiple loss scenarios, stress is applied by elongating the Current Roll to Loss rate for various periods, simulating a slower improvement in the transaction performance. The estimated net claims from the procedure above were discounted using a risk-free rate to a net present value reflecting MBIA's general obligation to pay claims over time and not on an accelerated basis. The above assumptions represent MBIA's best estimates of how transactions will perform over time. The Company monitors portfolio performance on a monthly basis against projected performance, reviewing delinquencies, Roll Rates, and prepayment rates (including voluntary and involuntary). However, given the large percentage of mortgage loans that were not underwritten in accordance with applicable underwriting guidelines, performance remains difficult to predict and losses may exceed expectations. In the event of a material deviation in actual performance from projected performance, the Company would increase or decrease the case basis reserves accordingly. If actual performance were to remain at the peak levels the Company is modeling for six months longer than in the probability-weighted outcome, the addition to the case basis reserves before considering potential recoveries would be approximately $175 million. Since the third quarter of 2009, paid claims in each month have been somewhat below that projected in the Company's model. The Company has not modified its expectations to reflect this lower paid claims rate. The difference between actual and projected paid claims has not been significant. The Company employs a similar approach to Alt-A transactions with limited exceptions. The three major exceptions are: 1) the timelines to liquidation depend on the delinquency bucket of a loan (e.g., a loan in the real estate owned bucket is on average liquidated more quickly than a loan in the foreclosure bucket), 2) the Company does not assume a 100% loss severity for charged-off Alt-A loans. The loss severity used for projections is the current loss severity for loans in an Alt-A transaction and 3) Current Roll to Loss stays at the May 31, 2011 level for five months before declining to 25% of this level over a 24-month period. RMBS Recoveries As of June 30, 2011, the Company recorded estimated recoveries of $2.7 billion, gross of income taxes, related to RMBS put-back claims on ineligible loans, consisting of $1.8 billion included in "Insurance loss recoverable" and $905 million included in "Loan repurchase commitments" presented under the heading "Assets of consolidated variable interest entities" on the Company's consolidated balance sheets. As of June 30, 2011 and December 31, 2010, the Company's estimated recoveries, after income taxes calculated at 35%, were $1.8 billion and $1.6 billion, respectively, which was 95% and 58% of the consolidated total shareholders' equity of MBIA, excluding preferred stock of subsidiaries and noncontrolling interest, respectively. The percentage increase of recoveries relative to shareholders' equity was principally driven by unrealized losses on insured derivatives as a result of MBIA's nonperformance risk on the derivative liabilities and an increase in recorded estimated recoveries related to put-back claims of ineligible loans. As of June 30, 2011 and December 31, 2010, the related statutory measures were 60% and 59%, respectively, of the statutory capital of MBIA Corp. These estimated recoveries relate to the Company's put-back claims of ineligible loans, which have been disputed by the loan sellers/servicers and are currently subject to litigation initiated by the Company to pursue recovery. While the Company believes that it will prevail in enforcing its contractual rights, there is uncertainty with respect to the ultimate outcome. Furthermore, there is a risk that sellers/servicers or other responsible parties might not be able to satisfy their put-back obligations. Although it has been reported that government-sponsored market participants and bond insurers situated similarly to MBIA have been successful in putting back ineligible mortgages to sellers/servicers and receiving compensation and other financial guarantee insurers situated similarly to MBIA also have recorded expected recoveries for RMBS transaction losses, there can be no assurance that MBIA will successfully make recoveries on its contract claims. Beginning in 2008, the Company utilized loan level forensic review consultants to re-underwrite/review a sample of the mortgage loan files underlying RMBS transactions insured by MBIA. The securitizations on which the Company has recorded losses contain well over 500,000 individual mortgages, of which over 50,000 mortgage loans have been reviewed within 32 insured issues containing first and second-lien mortgage loan securitizations. The Company recorded recoveries related to 28 of these 32 issues. The Company may review loan files from additional insured issues in the future if factors indicate that material recovery rights exist; however the Company believes that the practice of reviewing loans for purposes of assessing put-back recoveries is no longer necessary in light of legal decisions rendered during the fourth quarter of 2010 and second quarter of 2011, as discussed below. During their review, MBIA's forensic review consultants utilized the same underwriting guidelines that the originators were to have used to qualify borrowers when originally underwriting the loans and determined that more than 80% of the loans reviewed were considered to be ineligible mortgage loans. The consultants graded the individual mortgages that were sampled into an industry standard three level grading scale, defined as (i) Level 1—loans complied with specific underwriting guidelines, (ii) Level 2—loans contained some deviation from underwriting guidelines but also contained sufficient compensating factors and (iii) Level 3—loans contained material deviation from the underwriting guidelines without any compensating factors. Recent legal decisions have led the Company to conclude that the practice of reviewing individual loans for purpose of assessing put-back recoveries is no longer necessary. First, the Company determined that a sufficient number of loans in each securitization have already been reviewed to demonstrate widespread breaches of the contractual provisions of the agreements with the sponsors. Second, the Company received a favorable decision on its motion in limine addressing the use of sampling in the Countrywide litigation (MBIA Insurance Corp. v. Countrywide Home Loans, Inc., et al, Index No. 602825/08 (N.Y. Sup. Ct.)). That decision provided that MBIA can present representative samples of loans from each of the securitizations at issue in the case to establish its causes of action, including its breach-of-contract claims. Further, in May 2011, the court in MBIA Insurance Corp. v. Morgan Stanley, et al, Index No. 29951-10 (N.Y. Sup. Ct.) confirmed recent precedent and held that MBIA is not limited to a loan-by-loan put-back remedy and can seek a pool-wide remedy based on sampling and extrapolation. Based upon the above-referenced developments, the Company utilizes probability-based scenarios primarily based on the percentage of incurred losses the Company expects to collect as opposed to recoveries based primarily on loan file reviews. The Company's recovery estimates are based on five scenarios that include full recovery of its incurred losses and limited/reduced recoveries due to litigation delays and risks and/or potential financial distress of the sellers/servicers. Probabilities were assigned across these scenarios, with most of the probability weight on partial recovery scenarios. However, based on the Company's assessment of the strength of its contract claims, the Company believes it is entitled to collect the full amount of its incurred losses, which totaled $4.6 billion through June 30, 2011. The Company has developed estimates of breach rates primarily based upon loans with credit breaches or credit and compliance breaches because the Company believes that loans with these types of breaches are not judgmental and cannot be cured. The results of the loan file reviews across all insured issues have indicated breach rates in these categories in excess of 80%. Breach rates were determined by dividing the number of loans that contained credit and/or credit and compliance breaches by the total number of loans reviewed for a particular transaction. The Company has not recognized potential recoveries related to sellers/servicers that MBIA has determined did not have sufficient capital and resources to honor their obligations. The Company assesses the financial abilities of the sellers/servicers using external credit ratings and other factors. The impact of such factors on cash flows related to expected recoveries is incorporated into the Company's probability-weighted scenarios. The indicative scenarios and related probabilities assigned to each scenario based on the Company's judgment about their relative likelihoods of being realized are used to develop a distribution of possible outcomes. The sum of the probabilities assigned to all scenarios is 100%. Expected cash inflows from recoveries are discounted using the current risk-free rate associated with the underlying transaction, which ranged from 1.32% to 3.14%, depending upon the transaction's expected average life. The Company's potential recoveries are typically based on either salvage rights, the rights conferred to MBIA through the transactional documents (inclusive of the insurance agreement), or subrogation rights embedded within financial guarantee insurance policies. The RMBS transactions with respect to which MBIA has estimated put-back recoveries provide the Company with such rights. Expected salvage and subrogation recoveries, as well as recoveries from other remediation efforts, reduce the Company's claim liability. Once a claim payment has been made, the claim liability has been satisfied and MBIA's right to recovery is no longer considered an offset to future expected claim payments, but is recorded as a salvage asset. The amount of recoveries recorded by the Company is limited to paid claims plus the present value of projected future claim payments. As claim payments are made, the recorded amount of potential recoveries may exceed the remaining amount of claim liability for a given policy. To date, sellers/servicers have not substituted loans which MBIA has put back, and the amount of loans repurchased has been insignificant. The unsatisfactory resolution of these put-backs has led MBIA to initiate litigation against five of the sellers/servicers to enforce their obligations. The Company has alleged several causes of action in its complaints, including breach of contract, fraudulent inducement and indemnification. MBIA's aggregate $2.7 billion of estimated potential recoveries do not include damages from causes of action other than breach of contract. Irrespective of amounts recorded in its financial statements, MBIA is seeking to recover the full amount of its incurred losses and other damages. Currently, MBIA has received five decisions with regard to the motions to dismiss the Company's claims, all of which have initially denied the defendants' motions to dismiss, allowing each of the cases to proceed on, at minimum, the fraud and breach-of-contract claims. However, in June 2011, in one of the five cases (MBIA Insurance Corp. v. Credit Suisse Securities et al., Index No. 603751/09E (N.Y. Sup. Ct.)), the court reversed its earlier favorable decision permitting MBIA to pursue its fraud claim. However, subsequent to that Court's reversal, also in June 2011, the New York State Appellate Division, First Department issued a unanimous ruling affirming the lower court's decision in MBIA Insurance Corp. v. Countrywide Home Loans et al., Index No. 602825/08 permitting MBIA to pursue its fraud claims. The Company believes in light of this decision from the Appellate Division, the Court in the Credit Suisse case should reinstate its earlier favorable decision allowing MBIA to pursue its fraud claim in that matter as well. Additional information on the status of these litigations can be found in the "Recovery Litigation" discussion within "Note 13: Commitments and Contingencies." The Company's assessment of the recovery outlook for insured RMBS issues is principally based on the following factors:
| 1. | the strength of the Company's existing contract claims related to ineligible loan substitution/repurchase obligations;
| 2. | the settlement for $1.1 billion on Assured Guaranty's put-back related claims with Bank of America in April 2011;
| 3. | the improvement in the financial strength of issuers due to mergers and acquisitions and/or government assistance, which should facilitate their ability to comply with required loan repurchase/substitution obligations. The Company is not aware of any provisions that explicitly preclude or limit the successors' obligations to honor the obligations of the original sponsor. The Company's assessment of any credit risk associated with these sponsors (or their successors) is reflected in the Company's probability-weighted potential recovery scenarios;
| 4. | evidence of loan repurchase/substitution compliance by sellers/servicers for put-back requests made by other harmed parties with respect to ineligible loans; this factor is further enhanced by (i) Bank of America's disclosure that it has resolved $8.0 billion of repurchase requests in the fourth quarter of 2010; (ii) the Fannie Mae settlements announced on December 23, 2010 with Ally Bank and with Bank of America (which also involved Freddie Mac) announced on December 31, 2010, and (iii) the Company's settlement agreement entered into on July 16, 2010 between MBIA Corp. and the sponsor of several MBIA-insured mortgage loan securitizations in which MBIA Corp. received a payment in exchange for a release relating to its representation and warranty claims against the sponsor. This settlement also resolves all of MBIA's representation and warranty claims against the sponsor on mutually beneficial terms and is substantially consistent with the recoveries previously recorded by the Company related to these exposures;
| 5. | the favorable outcome for MBIA on defendants' motions to dismiss in the actions captioned MBIA Insurance Corp. v. Countrywide Home Loans, Inc., et al, Index No. 602825/08 (N.Y. Sup. Ct.): MBIA Insurance Corp. v. Residential Funding Co., LLC, Index No. 603552/08 (N.Y. Sup. Ct.), MBIA v GMAC Mortgage LLC, Index No. 600837/10E (N.Y. Sup. Ct.), and MBIA Insurance Corp. v. Morgan Stanley, et al, Index No. 29951-10 (N.Y. Sup. Ct.), where the respective courts each allowed MBIA's fraud claims against the Countrywide, RFC, GMAC and Morgan Stanley defendants to proceed;
| 6. | the favorable outcome for MBIA on its motion to present evidence of Countrywide's liability and damages through the introduction of statistically valid random samples of loans rather than on a loan-by-loan basis;
| 7. | the unanimous ruling from the New York State Appellate Division, First Department in the Countrywide litigation allowing MBIA to pursue its fraud claims; and
| 8. | loan repurchase reserves and/or settlements which have been publicly disclosed by certain sellers/servicers to cover such obligations.
The Company continues to consider all relevant facts and circumstances, including the factors described above, in developing its assumptions on expected cash inflows, probability of potential recoveries (including the outcome of litigation) and recovery period. The estimated amount and likelihood of potential recoveries are expected to be revised and supplemented as developments in the pending litigation proceedings occur or new litigation is initiated. While the Company believes it will be successful in realizing recoveries from contractual and other claims, the ultimate amounts recovered may be materially different from those recorded by the Company given the inherent uncertainty of the manner of resolving the claims (e.g., litigation) and the assumptions used in the required estimation process for accounting purposes which are based, in part, on judgments and other information that are not easily corroborated by historical data or other relevant benchmarks. All of the Company's policies insuring RMBS for which litigation has been initiated against sellers/servicers are in the form of financial guarantee insurance contracts. The Company has not recorded a gain contingency with respect to pending litigation. Loss and LAE Activity
Aggregate Losses and LAE (change in expected net payments) In millions |  | Six Months Ended June 30, 2011 |
| RMBS |  |  | Non-RMBS |  |  | Total |
Financial guarantee insurance losses and LAE (1) |  | $ | (50 | ) |  | $ | 64 |  |  | $ | 14 |
Financial guarantee insurance losses and LAE related to consolidated VIEs (eliminated in consolidation) (2) |  |  | (39 | ) |  |  | 51 |  |  |  | 12 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | - |  |  |  | (34 | ) |  |  | (34 | )
Total aggregate losses and LAE |  | $ | (89 | ) |  | $ | 81 |  |  | $ | (8 | )
(1) - Represents "Losses and loss adjustment expense" as reported on the Company's consolidated statement of operations. (2) - Represents losses and LAE eliminated upon the consolidation of insured VIEs. (3) - Represents statutory losses and LAE for insurance contracts accounted for as derivatives. Realized and unrealized gains and losses on these contracts under U.S. GAAP are recorded in "Net change in fair value of insured derivatives" on the Company's consolidated statement of operations.
Aggregate Loss and LAE Reserves |  |  |  |  |  |
In millions |  | As of June 30, 2011 |  |  | As of December 31, 2010 |
Financial guarantee insurance (1) |  | $ | 865 |  |  | $ | 1,129 |
Financial guarantee insurance reserves related to consolidated VIEs (eliminated in consolidation) (2) |  |  | 352 |  |  |  | 377 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | 2,047 |  |  |  | 2,490 |
Reinsurance |  |  | (16) |  |  |  | (15) |
Total aggregate loss and LAE reserves |  | $ | 3,248 |  |  | $ | 3,981 |
(1) - Represents "Loss and loss adjustment expense reserves" as reported on the Company's consolidated balance sheets. (2) - Represents loss and LAE reserves eliminated upon the consolidation of insured VIEs. (3) - Represents statutory loss and LAE reserves for insurance contracts accounted for as derivatives under U.S. GAAP. The fair values of these contracts are recorded in "Derivative liabilities" on the Company's consolidated balance sheets. |
Aggregate Insurance Loss Recoverable |  |  |  |  |  |
In millions |  | As of June 30, 2011 |  |  | As of December 31, 2010 |
Financial guarantee insurance (1) |  | $ | 2,658 |  |  | $ | 2,531 |
Financial guarantee insurance reserves related to consolidated VIEs (eliminated in consolidation) (2) |  |  | 1,159 |  |  |  | 1,061 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | 66 |  |  |  | 74 |
Reinsurance |  |  | (8) |  |  |  | (4) |
Total aggregate insurance loss recoverable |  | $ | 3,875 |  |  | $ | 3,662 |
(1) - Represents "Insurance loss recoverable" as reported on the Company's consolidated balance sheets. (2) - Represents insurance loss recoverable eliminated upon the consolidation of insured VIEs. (3) - Represents statutory recoveries for insurance contracts accounted for as derivatives under U.S. GAAP. The fair values of these contracts are recorded in "Derivative liabilities" on the Company's consolidated balance sheets.
As described in "Note 1: Businesses, Developments, Risks and Uncertainties" included herein, the Company faces significant risks and uncertainties related to potential or actual losses from its CMBS insured exposure, which is mostly in the form of insured derivatives, its RMBS insured exposure, including the receipt of recoveries, and its ABS CDO insured exposure. Continued significant adverse developments and higher expected payments on these exposures could result in a decline in the Company's liquidity and statutory capital position. The impact of insured exposures on the Company's liquidity position is best understood by assessing the ultimate amount of payments that the Company will be required to make in respect of these exposures. In this regard, the Company discloses the discounted expected future net cash flows to be made under all insurance contracts, irrespective of the legal form of the guarantee (i.e., financial guarantee policy or insured derivative contract) or the U.S. GAAP accounting basis. The following tables present the aggregate changes in the discounted values of loss payments expected to be made on all insurance contracts for the six months ended June 30, 2011, and aggregate loss reserves and insurance loss recoverables as of June 30, 2011 and December 31, 2010. All amounts presented in the following tables are calculated in accordance with U.S. GAAP, with the exception of "Insured credit derivative impairments and LAE." The amounts reported for "Insured credit derivative impairments and LAE" are calculated in accordance with U.S. statutory accounting principles because U.S. GAAP does not contain a comparable measurement basis for these contracts. All losses and recoverables reported in the following tables are measured using discounted probability-weighted cash flows. Losses and recoverables on VIEs that are eliminated in consolidation are included because the consolidation of these VIEs does not impact whether or not the Company will be required to make payments under its insurance contracts. As a result of the different accounting bases of amounts included in the following tables, the total provided in each table represents a non-GAAP measure.
Aggregate Losses and LAE (change in expected net payments) In millions |  | Six Months Ended June 30, 2011 |
| RMBS |  |  | Non-RMBS |  |  | Total |
Financial guarantee insurance losses and LAE (1) |  | $ | (50 | ) |  | $ | 64 |  |  | $ | 14 |
Financial guarantee insurance losses and LAE related to consolidated VIEs (eliminated in consolidation) (2) |  |  | (39 | ) |  |  | 51 |  |  |  | 12 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | - |  |  |  | (34 | ) |  |  | (34 | )
Total aggregate losses and LAE |  | $ | (89 | ) |  | $ | 81 |  |  | $ | (8 | )
(1) - Represents "Losses and loss adjustment expense" as reported on the Company's consolidated statement of operations. (2) - Represents losses and LAE eliminated upon the consolidation of insured VIEs. (3) - Represents statutory losses and LAE for insurance contracts accounted for as derivatives. Realized and unrealized gains and losses on these contracts under U.S. GAAP are recorded in "Net change in fair value of insured derivatives" on the Company's consolidated statement of operations.
Aggregate Loss and LAE Reserves |  |  |  |  |  |
In millions |  | As of June 30, 2011 |  |  | As of December 31, 2010 |
Financial guarantee insurance (1) |  | $ | 865 |  |  | $ | 1,129 |
Financial guarantee insurance reserves related to consolidated VIEs (eliminated in consolidation) (2) |  |  | 352 |  |  |  | 377 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | 2,047 |  |  |  | 2,490 |
Reinsurance |  |  | (16) |  |  |  | (15) |
Total aggregate loss and LAE reserves |  | $ | 3,248 |  |  | $ | 3,981 |
(1) - Represents "Loss and loss adjustment expense reserves" as reported on the Company's consolidated balance sheets. (2) - Represents loss and LAE reserves eliminated upon the consolidation of insured VIEs. (3) - Represents statutory loss and LAE reserves for insurance contracts accounted for as derivatives under U.S. GAAP. The fair values of these contracts are recorded in "Derivative liabilities" on the Company's consolidated balance sheets. |
Aggregate Insurance Loss Recoverable |  |  |  |  |  |
In millions |  | As of June 30, 2011 |  |  | As of December 31, 2010 |
Financial guarantee insurance (1) |  | $ | 2,658 |  |  | $ | 2,531 |
Financial guarantee insurance reserves related to consolidated VIEs (eliminated in consolidation) (2) |  |  | 1,159 |  |  |  | 1,061 |
Insured credit derivative impairments and LAE (statutory basis) (3) |  |  | 66 |  |  |  | 74 |
Reinsurance |  |  | (8) |  |  |  | (4) |
Total aggregate insurance loss recoverable |  | $ | 3,875 |  |  | $ | 3,662 |
(1) - Represents "Insurance loss recoverable" as reported on the Company's consolidated balance sheets. (2) - Represents insurance loss recoverable eliminated upon the consolidation of insured VIEs. (3) - Represents statutory recoveries for insurance contracts accounted for as derivatives under U.S. GAAP. The fair values of these contracts are recorded in "Derivative liabilities" on the Company's consolidated balance sheets.
Financial Guarantee Insurance Losses (Non-Derivative) The Company's financial guarantee insurance losses and LAE for the six months ended June 30, 2011 are presented in the following table:
Losses and LAE |  | Six Months Ended June 30, 2011 |
In millions |  | RMBS |  |  | Non-RMBS |  |  | Total |
Losses and LAE related to actual and expected payments |  | $ | 16 |  |  | $ | (54) |  |  | $ | (38) |
Recoveries of actual and expected payments |  |  | (66) |  |  |  | 120 |  |  |  | 54 |
Gross losses incurred |  |  | (50) |  |  |  | 66 |  |  |  | 16 |
Reinsurance |  |  | 0 |  |  |  | (2) |  |  |  | (2) |
Losses and LAE |  | $ | (50) |  |  | $ | 64 |  |  | $ | 14 |
The RMBS losses and LAE related to actual and expected payments included in the preceding table comprise net increases of previously established reserves. The RMBS recoveries of actual and expected payments comprise $154 million in recoveries resulting from ineligible mortgage loans included in insured second-lien residential mortgage securitization exposures that are subject to contractual obligations by sellers/servicers to repurchase or replace such mortgages, offset by an $88 million reduction in excess interest cash flows from the securitizations. Non-RMBS losses and LAE were primarily driven by non-RMBS mortgage and ABS CDO transactions as a result of continued credit deterioration within those sectors. Additionally, the reversal of loss and LAE reserves related to lower expected future claim payments from a tax-backed transaction were offset by the reversal of the corresponding recoveries of such payments. Current period changes in the Company's estimate of potential recoveries may impact the amount recorded as an insurance loss recoverable asset, the amount of expected recoveries on unpaid losses netted against the gross loss and LAE reserve liability, or both. Total paid losses, net of reinsurance and collections, for the six months ended June 30, 2011 was $403 million, including $333 million related to insured RMBS transactions. For the six months ended June 30, 2011, the increase in insurance loss recoverable related to paid losses totaled $122 million, and primarily related to insured RMBS transactions. The following table provides information about the financial guarantees and related claim liability included in each of MBIA's surveillance categories as of June 30, 2011:
|  | Surveillance Categories |
$ in millions |  | Caution List Low |  |  | Caution List Medium |  |  | Caution List High |  |  | Classified List |  |  | Total |
Number of policies |  |  | 50 |  |  |  | 43 |  |  |  | 10 |  |  |  | 189 |  |  |  | 292 |
Number of issues(1) |  |  | 34 |  |  |  | 27 |  |  |  | 5 |  |  |  | 123 |  |  |  | 189 |
Remaining weighted average contract period (in years) |  |  | 9.0 |  |  |  | 5.3 |  |  |  | 7.7 |  |  |  | 9.5 |  |  |  | 8.9 |
Gross insured contractual payments outstanding(2): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Principal |  | $ | 4,247 |  |  | $ | 1,861 |  |  | $ | 206 |  |  | $ | 10,658 |  |  | $ | 16,972 |
Interest |  |  | 2,776 |  |  |  | 559 |  |  |  | 67 |  |  |  | 5,959 |  |  |  | 9,361 |
Total |  | $ | 7,023 |  |  | $ | 2,420 |  |  | $ | 273 |  |  | $ | 16,617 |  |  | $ | 26,333 |
Gross claim liability |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 2,039 |  |  | $ | 2,039 |
Less: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gross potential recoveries |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,663 |  |  |  | 3,663 |
Discount, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 158 |  |  |  | 158 |
Net claim liability (recoverable) |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | (1,782) |  |  | $ | (1,782) |
Unearned premium revenue |  | $ | 154 |  |  | $ | 17 |  |  | $ | 2 |  |  | $ | 137 |  |  | $ | 310 |
(1) - An "issue" represents the aggregate of financial guarantee policies that share the same revenue source for purposes of making debt service payments. (2) - Represents contractual principal and interest payments due by the issuer of the obligations insured by MBIA. |
The gross claim liability represents the Company's estimate of undiscounted probability-weighted future claim payments, which primarily relate to insured RMBS transactions. The gross potential recoveries represent the Company's estimate of undiscounted probability-weighted recoveries of actual claim payments and recoveries of estimated future claim payments and also primarily relate to insured RMBS transactions. Both amounts reflect the elimination of claim liabilities and potential recoveries related to VIEs consolidated by the Company. The following table provides information about the financial guarantees and related claim liability included in each of MBIA's surveillance categories as of December 31, 2010:
|  | Surveillance Categories |
$ in millions |  | Caution List Low |  |  | Caution List Medium |  |  | Caution List High |  |  | Classified List |  |  | Total |
Number of policies |  |  | 199 |  |  |  | 43 |  |  |  | 12 |  |  |  | 179 |  |  |  | 433 |
Number of issues(1) |  |  | 40 |  |  |  | 26 |  |  |  | 12 |  |  |  | 110 |  |  |  | 188 |
Remaining weighted average contract period (in years) |  |  | 9.4 |  |  |  | 6.9 |  |  |  | 9.1 |  |  |  | 9.4 |  |  |  | 9.2 |
Gross insured contractual payments outstanding(2): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Principal |  | $ | 5,041 |  |  | $ | 1,419 |  |  | $ | 1,446 |  |  | $ | 11,190 |  |  | $ | 19,096 |
Interest |  |  | 3,439 |  |  |  | 536 |  |  |  | 746 |  |  |  | 6,132 |  |  |  | 10,853 |
Total |  | $ | 8,480 |  |  | $ | 1,955 |  |  | $ | 2,192 |  |  | $ | 17,322 |  |  | $ | 29,949 |
Gross claim liability |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | 2,692 |  |  | $ | 2,692 |
Less: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Gross potential recoveries |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 4,045 |  |  |  | 4,045 |
Discount, net |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 27 |  |  |  | 27 |
Net claim liability (recoverable) |  | $ | - |  |  | $ | - |  |  | $ | - |  |  | $ | (1,380) |  |  | $ | (1,380) |
Unearned premium revenue |  | $ | 148 |  |  | $ | 16 |  |  | $ | 72 |  |  | $ | 141 |  |  | $ | 377 |
(1) - An "issue" represents the aggregate of financial guarantee policies that share the same revenue source for purposes of making debt service payments. (2) - Represents contractual principal and interest payments due by the issuer of the obligations insured by MBIA. |
The gross claim liability and gross potential recoveries in the preceding table primarily related to insured RMBS transactions. Both amounts reflect the elimination of claim liabilities and potential recoveries related to VIEs consolidated by the Company. The following table presents the components of the Company's insurance loss reserves and recoverables for insured obligations within MBIA's classified list as reported on the Company's consolidated balance sheets as of June 30, 2011 and December 31, 2010. The loss reserves (claim liability) and insurance claim loss recoverable included in the following table represent the present value of the probability-weighted future claim payments and recoveries reported in the preceding tables.
In millions |  | As of June 30, 2011 |  |  | As of December 31, 2010 |
Loss reserves (claim liability) |  | $ | 795 |  |  | $ | 1,059 |
LAE reserves |  |  | 70 |  |  |  | 70 |
Loss and LAE reserves |  | $ | 865 |  |  | $ | 1,129 |
Insurance claim loss recoverable |  | $ | (2,655) |  |  | $ | (2,531) |
LAE insurance loss recoverable |  |  | (3) |  |  |  | - |
Insurance loss recoverable |  | $ | (2,658) |  |  | $ | (2,531) |
Reinsurance recoverable on unpaid losses |  | $ | 16 |  |  | $ | 14 |
Reinsurance recoverable on LAE reserves |  |  | 0 |  |  |  | 1 |
Reinsurance recoverable on paid losses |  |  | 4 |  |  |  | - |
Reinsurance recoverable on paid and unpaid losses |  | $ | 20 |  |  | $ | 15 |
As of June 30, 2011, loss and LAE reserves include $1.6 billion of reserves for expected future payments offset by expected recoveries of such future payments of $701 million. As of December 31, 2010, loss and LAE reserves include $2.0 billion of reserves for expected future payments offset by expected recoveries of such future payments of $896 million. As of June 30, 2011 and December 31, 2010, the insurance loss recoverable primarily related to estimated recoveries of payments made by the Company resulting from ineligible mortgage loans in certain insured second-lien residential mortgage loan securitizations that are subject to a contractual obligation by the sellers/servicers to repurchase or replace the ineligible mortgage loans and expected future recoveries on RMBS transactions resulting from expected excess spread generated by performing loans in such transactions. The Company expects to be reimbursed for the majority of its potential recoveries related to ineligible mortgage loans by year-end 2012. The following table presents the Company's RMBS exposure, gross undiscounted claim liability and potential recoveries, before the elimination of amounts related to consolidated VIEs, as of June 30, 2011. All loan files reviewed with recognized recoveries are included within the "Classified List."
RMBS Exposure |  |  |  |  | Outstanding |  |  | Gross Undiscounted |
|  |  |  |  | Gross |  |  | Gross |  |  | Claim |  |  | Potential |
$ in billions |  | Issues |  |  | Principal |  |  | Interest |  |  | Liability |  |  | Recoveries |
Insured issues designated as "Classified List" |  |  | 47 |  |  | $ | 9.4 |  |  | $ | 4.0 |  |  | $ | 1.1 |  |  | $ | 4.3 |
Loan files reviewed with recognized recoveries |  |  | 28 |  |  | $ | 8.2 |  |  | $ | 3.3 |  |  | $ | 0.8 |  |  | $ | 4.3 |
The Company has performed loan file reviews on 30 of the 47 issues and recorded recoveries on 28 of those 30 issues. The gross potential recoveries include estimated recoveries based on the Company's incurred loss to date. The following table presents changes in the Company's loss and LAE reserve for the six months ended June 30, 2011. Changes in the loss and LAE reserve attributable to the accretion of the claim liability discount, changes in discount rates, changes in the timing and amounts of estimated payments and recoveries, changes in assumptions and changes in LAE reserves are recorded in "Losses and loss adjustment" expenses in the Company's consolidated statement of operations. As of June 30, 2011, the weighted average risk-free rate used to discount the Company's loss reserve (claim liability) was 2.42%. LAE reserves are expected to be settled within a one year period and are not discounted.
In millions |  |  | Changes in Loss and LAE Reserves for the Six Months Ended June 30, 2011 |  |  | Gross Loss and LAE Reserve as of June 30, 2011 |
Gross Loss and LAE Reserve as of December 31, 2010 |  |  | Loss Payments for Cases with Reserves |  |  | Accretion of Claim Liability Discount |  |  | Changes in Discount Rates |  |  | Changes in Timing of Payments |  |  | Changes in Amount of Net Payments |  |  | Changes in Assumptions |  |  | Changes in Unearned Premium Revenue |  |  | Change in LAE Reserves |  |
$ | 1,129 |  |  | $ | (324 | ) |  | $ | 9 |  |  | $ | (47 | ) |  | $ | 20 |  |  | $ | (1 | ) |  | $ | 64 |  |  | $ | 16 |  |  | $ | (1 | ) |  | $ | 865 |
The Company's gross loss and LAE reserves reflected in the preceding table decreased $264 million primarily due to a decrease in reserves related to loss payments and changes in discount rates. Offsetting these decreases were changes in assumptions due to additional defaults and charge-offs of ineligible mortgage loans in insured RMBS issues outstanding as of December 31, 2010. The following table presents changes in the Company's insurance loss recoverable and changes in recoveries on unpaid losses reported within the Company's claim liability for the six months ended June 30, 2011. Changes in insurance loss recoverable attributable to the accretion of the discount on the recoverable, changes in discount rates, changes in the timing and amounts of estimated collections, changes in assumptions and changes in LAE recoveries are recorded in "Losses and loss adjustment" expenses in the Company's consolidated statement of operations.
|  | Changes in Insurance Loss Recoverable and Recoveries on Unpaid Losses for the Six Months Ended June 30, 2011 |
In millions |  | Gross Reserve as of December 31, 2010 |  |  | Collections for Cases with Recoveries |  |  | Accretion of Recoveries |  |  | Changes in Discount Rates |  |  | Changes in Timing of Collections |  |  | Changes in Amount of Collections |  |  | Changes in Assumptions |  |  | Change in LAE Recoveries |  |  | Gross Reserve as of June 30, 2011 |
Insurance Loss Recoverable |  | $ | 2,531 |  |  | $ | (3) |  |  | $ | 34 |  |  | $ | 20 |  |  | $ | - |  |  | $ | (116) |  |  | $ | 190 |  |  | $ | 2 |  |  | $ | 2,658 |
Recoveries on Unpaid Losses |  |  | 896 |  |  |  | - |  |  |  | 10 |  |  |  | 2 |  |  |  | - |  |  |  | - |  |  |  | (212) |  |  |  | 5 |  |  |  | 701 |
Total |  | $ | 3,427 |  |  | $ | (3) |  |  | $ | 44 |  |  | $ | 22 |  |  | $ | - |  |  | $ | (116) |  |  | $ | (22) |  |  | $ | 7 |  |  | $ | 3,359 |
The Company's insurance loss recoverable increased $127 million primarily due to changes in assumptions driven by estimates of potential recoveries on issues outstanding as of December 31, 2010 resulting from ineligible mortgage loans included in insured second-lien residential mortgage securitization exposures that are subject to contractual obligations by sellers/servicers to repurchase or replace such mortgages, partially offset by changes in the amount of collections. Recoveries on unpaid losses decreased by $195 million primarily due to changes in assumptions as a result of reduced expectations of future claim payments on U.S. public finance transactions, which resulted in a corresponding reduction in future expected recoveries. The following table presents the Company's total estimated recoveries from ineligible mortgage loans included in certain insured first and second-lien mortgage loan securitizations. The total estimated recoveries from ineligible loans of $2.7 billion as of June 30, 2011 include $1.8 billion recorded as "Insurance loss recoverable" and $905 million recorded as "Loan repurchase commitments" presented under the heading "Assets of consolidated variable interest entities" on the Company's consolidated balance sheet.
In millions |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total Estimated Recoveries from Ineligible Loans as of December 31, 2010 |  |  | Accretion of Future Collections |  |  | Changes in Discount Rates |  |  | Recoveries (Collections) |  |  | Changes in Assumptions |  |  | Total Estimated Recoveries from Ineligible Loans as of June 30, 2011 |
$ | 2,517 |  |  | $ | 38 |  |  | $ | 12 |  |  | $ | - |  |  | $ | 174 |  |  | $ | 2,741 |
The $174 million of changes in assumptions in the preceding table primarily resulted from probability-weighted scenarios as described within the preceding "RMBS Recoveries" section. Remediation actions may involve, among other things, waivers or renegotiations of financial covenants or triggers, waivers of contractual provisions, the granting of consents, transfer of servicing, consideration of restructuring plans, acceleration, security or collateral enforcement, actions in bankruptcy or receivership, litigation and similar actions. The types of remedial actions pursued are based on the insured obligation's risk type and the nature and scope of the event giving rise to the remediation. As part of any such remedial actions, MBIA seeks to improve its security position and to obtain concessions from the issuer of the insured obligation. From time to time, the issuer of an MBIA-insured obligation may, with the consent of MBIA, restructure the insured obligation by extending the term, increasing or decreasing the par amount or decreasing the related interest rate, with MBIA insuring the restructured obligation. Costs associated with remediating insured obligations assigned to the Company's "Caution List—Low," "Caution List—Medium," "Caution List—High" and "Classified List" are recorded as LAE. LAE is primarily recorded as part of the Company's provision for its loss reserves and included in "Losses and loss adjustment" expense on the Company's consolidated statements of operations. The following table presents the expenses (gross and net of reinsurance) related to remedial actions for insured obligations:
|  | Three Months Ended June 30, |  |  | Six Months Ended June 30, |
In millions |  | 2011 |  |  | 2010 |  |  | 2011 |  |  | 2010 |
Loss adjustment expense incurred, gross |  | $ | 30 |  |  | $ | 2 |  |  | $ | 45 |  |  | $ | 16 |
Loss adjustment expense incurred, net |  | $ | 30 |  |  | $ | 3 |  |  | $ | 45 |  |  | $ | 15 |
Credit Impairments Related to Structured CMBS Pools and CRE CDOs Accounted for as Derivatives Most of the structured CMBS pools and CRE CDOs insured by MBIA are accounted for as insured credit derivatives and are carried at fair value in the Company's consolidated financial statements. The fair value of an insured derivative contract will be influenced by a variety of market and transaction-specific factors that may be unrelated to potential future claim payments. In the absence of credit impairments, or the termination of derivatives at losses, the cumulative unrealized losses recorded from fair valuing insured derivatives should reverse before or at the maturity of the contracts. Since insured credit derivatives have similar terms, conditions, risks, and economic profiles to financial guarantee insurance policies, they are evaluated for economic impairment periodically in the same way that loss and LAE reserves are estimated for financial guarantee insurance policies. Credit impairments on insured derivatives represent the present value of estimated expected future claim payments, net of recoveries, for such transactions using a discount rate of 5.93%, consistent with the calculation of the Company's statutory loss reserves. These credit impairments, calculated using the statutory loss reserve methodology, differ from the fair values recorded in the Company's consolidated financial statements. Although the Company's consolidated statements of operations include the changes in the fair values of these transactions, the Company regards the changes in credit impairment estimates as critical information for investors as it provides information about loss payments the Company expects to make. For the six months ended June 30, 2011, the additional estimated credit impairment on structured CMBS pools and CRE CDO portfolios was estimated to be $363 million as a result of additional delinquencies and loan level liquidations. The aggregate credit impairment on structured CMBS pools and CRE CDO portfolios was estimated to be $1.5 billion through June 30, 2011. The impairment is estimated using the Company's loss reserve methodology, determined as the present value of the probability–weighted potential future losses, net of estimated recoveries, across multiple scenarios as described below. Although the pace of increases in the delinquency rate has slowed and many loans are being modified, liquidations have taken place. Some loans were liquidated with minimal losses of 1% to 2% while others experienced near complete losses. These have led to losses in the CMBS market, and in many cases, have resulted in reductions of enhancement to the individual CMBS bonds within the structured CMBS pools insured by MBIA. In certain insured transactions, these losses have resulted in deductible erosion. Bond level enhancement and pool level deductibles are structural features intended to mitigate losses to the Company. As that protection is eroded, impairments increase even in the absence of significant further collateral deterioration. In the CRE CDO portfolio, transaction specific structures require managers to report reduced enhancement according to certain guidelines which often include downgrades even when the bond is still performing. As a result, as well as additional collateral defaults, reported enhancement has been reduced significantly in some CRE CDOs. However, because of this, many of the CRE CDO positions are amortizing more quickly than originally expected as most or all interest that would have been allocated to more junior classes within the CDO has been diverted and redirected to pay down the senior most classes insured by MBIA. The Company has developed multiple scenarios to consider the range of potential outcomes in the CRE market and their impact on MBIA. The approaches require substantial judgments about the future performance of the underlying loans, and include the following:
| • |  | The first approach considers the range of commutations achieved in the course of 2010 and 2011, which included commutations of 22 structured CMBS pools and CRE CDO policies totaling $10.3 billion of gross insured exposure. This approach results in an estimated price to commute the remaining policies with price estimates based on this experience.
| • |  | The second approach considers current delinquency rates and uses current and projected net operating income ("NOI") and capitalization rates ("Cap Rates") to project losses under three scenarios. In the first scenario, NOI and Cap Rates remain flat with no improvement over the remaining life of the loans (often five to six more years). In the second and third scenarios, loans are stratified by size with larger loans being valued utilizing lower Cap Rates than for smaller loans. These scenarios also assume that Cap Rates and NOIs remain flat for the near term and then begin to improve slowly. Additionally, in these scenarios, any loan with a balance greater than $75 million with a debt service coverage ratio less than 1.0x or that was reported as being in any stage of delinquency, was reviewed individually so that performance and loss severity could be more accurately determined. Specific loan level assumptions for this large loan subset were then incorporated into this scenario. The second and third scenarios project different levels of additional defaults with respect to loans that are current. This approach relies heavily on year-end financial statements at the property level. In modeling these scenarios, the Company has received financial statements for year-end 2010 for 68% of the properties in the pools.
| • |  | The third approach stratifies loans into debt service coverage buckets and uses default probabilities implied by a third-party default study for each bucket to project defaults. The implied defaults are converted into losses using a loss severity assumption. This approach also relies on year-end financial statements at the property level. As the Company continues to see more current market performance statistics regarding modifications and liquidations in this cycle, the Company will continue to de-emphasize this more actuarial-based approach and focus more on those scenarios which best reflect current market observations.
| • |  | The fourth approach stratifies loans into buckets based on delinquency status (including a "current" bucket) and utilizes recent Roll Rates actually experienced within each of the commercial mortgage-backed index ("CMBX") series in order to formulate an assumption to predict future delinquencies. Ultimately, this generates losses over a projected time horizon based on the assumption that loss severities will remain at the peak level for a given time period and then decrease over time. This approach was applied in two scenarios. In the first scenario, the Company assumes that 75% of the loans greater than 90 days delinquent (and those projected to roll into late stage delinquency from the current and lesser stage levels of delinquency) are liquidated. In the second scenario, the Company assumes that 65% of these loans are liquidated and that 35% are modified and returned to current. These estimates are based on the levels of modifications that took place within the corresponding CMBX indices in the previous twenty-two months ended May 31, 2011.
The loss severities projected by these scenarios vary widely, from moderate to substantial losses. The Company assigns a wide range of probabilities to these scenarios, with lower severity scenarios being weighted more heavily than higher severity scenarios. This reflects the view that liquidations will continue to be mitigated by loan extensions and modifications, and that property values and NOIs have bottomed for many sectors and markets in the U.S. Beginning with the first quarter of 2010 through June 30, 2011, the probability-weighted loss estimate was $1.5 billion, and is inclusive of any claim or settlement payments. If macroeconomic stress escalates, there is a "double dip" recession, higher delinquencies, higher levels of liquidations of delinquent loans and/or higher severities of loss upon liquidation, MBIA may incur substantial additional losses. Actual losses will be a function of the proportion of loans in the pools that are foreclosed and liquidated and the loss severities associated with those liquidations. If the deductibles in the Company's insured transactions and underlying referenced CMBS transactions are fully eroded, additional property level losses upon foreclosures and liquidations could result in substantial losses for MBIA. Since foreclosures and liquidations have only begun to take place over the past few months during this economic cycle, particularly for larger properties, ultimate loss rates remain uncertain. Whether CMBS collateral is included in a structured pool or in a CRE CDO, the Company believes the modeling related to the underlying bond should be the same.

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- Definition Disclosure of accounting policy for the various components of the reserve for future policy benefits and guaranteed minimum benefits, and for claims and claims adjustment expenses; the significant assumptions for estimating claims losses; causes of significant variances from prior periods (such as catastrophes, asbestos and environmental claims reserve losses); and reconciliations of beginning to ending reserve balances. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6482485&loc=d3e14764-158437 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6482852&loc=d3e14931-158439 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Article 7 -Section 03 -Paragraph 13 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 40 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6482485&loc=d3e14754-158437 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 60 -Paragraph 60 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Statement of Position (SOP) -Number 94-5 -Paragraph 11 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 210 -Section S99 -Paragraph 1 -Subparagraph (SX 210.7-03.13(a)(1),(b)) -URI http://asc.fasb.org/extlink&oid=6879938&loc=d3e572229-122910 + Details
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