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Schedule II- Parent Company Financials
 12 Months Ended
Dec. 31, 2014
Condensed Financial Information of Parent Company Only Disclosure [Abstract]  
Condensed Financial Information of Parent Company Only Disclosure
SCHEDULE II
MBIA INC. (PARENT COMPANY)
CONDENSED BALANCE SHEETS
(In millions except share and per share amounts)
December 31, 2014December 31, 2013
Assets
Investments:
Fixed-maturity securities held as available-for-sale, at fair value (amortized cost $671 and $703)$751$728
Investments carried at fair value3332
Investments pledged as collateral, at fair value (amortized cost $445 and $463)408375
Short-term investments held as available-for-sale, at fair value (amortized cost $327 and $171)327171
Other investments43
Total investments1,5231,309
Cash and cash equivalents100140
Investment in wholly-owned subsidiaries3,9533,890
Deferred income taxes, net965791
Other assets143140
Total assets$6,684$6,270
Liabilities and Shareholders' Equity
Liabilities:
Investment agreements505654
Long-term debt592592
Affiliate loans payable1,2071,510
Other liabilities451236
Total liabilities2,7552,992
Shareholders' Equity:
Preferred stock, par value $1 per share; authorized shares--10,000,000; issued and outstanding--none--
Common stock, par value $1 per share; authorized shares--400,000,000; issued shares--281,352,782
and 277,812,430281278
Additional paid-in capital3,1283,115
Retained earnings 2,8582,289
Accumulated other comprehensive income (loss), net of tax of $6 and $2521(86)
Treasury stock, at cost--89,409,887 and 85,562,546 shares(2,359)(2,318)
Total shareholders' equity of MBIA Inc.3,9293,278
Total liabilities and shareholders' equity$6,684$6,270
The condensed financial statements should be read in conjunction with the
consolidated financial statements and notes thereto and the accompanying notes.
SCHEDULE II
MBIA INC. (PARENT COMPANY)
CONDENSED STATEMENTS OF OPERATIONS
(In millions)
Years ended December 31,
201420132012
Revenues:
Net investment income$44$50$60
Net gains (losses) on financial instruments at fair value and foreign exchange2411(119)
Investment losses related to other-than-temporary impairments:
Investment losses related to other-than-temporary impairments--(52)
Other-than-temporary impairments recognized in accumulated other
comprehensive income (loss)--(7)
Net investment losses related to other-than-temporary impairments--(59)
Net gains (losses) on extinguishment of debt143(2)
Other net realized gains (losses)1-6
Total revenues70104(114)
Expenses:
Operating256940
Interest104105155
Total expenses129174195
Gain (loss) before income taxes and equity in earnings of subsidiaries(59)(70)(309)
Provision (benefit) for income taxes(165)(202)(781)
Gain (loss) before equity in earnings of subsidiaries106132472
Equity in net income (loss) of subsidiaries463118762
Net income (loss)$569$250$1,234
The condensed financial statements should be read in conjunction with the
consolidated financial statements and notes thereto and the accompanying notes.
SCHEDULE II
MBIA INC. (PARENT COMPANY)
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In millions)
Years ended December 31,
201420132012
Net income (loss)$569$250$1,234
Other comprehensive income (loss):
Unrealized gains (losses) on available-for-sale securities:
Unrealized gains (losses) arising during the period126(179)166
Provision (benefit) for income taxes14(17)36
Total112(162)130
Reclassification adjustments for (gains) losses included in net income (loss)2323111
Provision (benefit) for income taxes8839
Total151572
Available-for-sale securities with other-than-temporary impairments:
Other-than-temporary impairments and unrealized gains (losses)
arising during the period-1238
Provision (benefit) for income taxes-413
Total-825
Reclassification adjustments for (gains) losses included in net income (loss)4-31
Provision (benefit) for income taxes1-11
Total3-20
Foreign currency translation:
Foreign currency translation gains (losses)(23)(3)(15)
Total other comprehensive income (loss)107(142)232
Comprehensive income (loss)$676$108$1,466
The condensed financial statements should be read in conjunction with the
consolidated financial statements and notes thereto and the accompanying notes.
SCHEDULE II
MBIA INC. (PARENT COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
(In millions)
Years ended December 31,
201420132012
Cash flows from operating activities:
Fees and reimbursements received$1$-$5
Investment income received256250118
Operating expenses paid(35)(35)(43)
Interest paid, net of interest converted to principal(93)(93)(101)
Income taxes (paid) received59111224
Net cash provided (used) by operating activities188233203
Cash flows from investing activities:
Purchases of available-for-sale investments(125)(287)(560)
Sales of available-for-sale investments2681471,148
Paydowns and maturities of available-for-sale investments982521,036
Purchases of investments at fair value(266)(144)(42)
Sales, paydowns and maturities of investments at fair value280126139
Sales, paydowns and maturities (purchases) of short-term investments, net(242)94114
(Payments) proceeds for derivative settlements(26)(32)(207)
Collateral (to) from swap counterparty144122(285)
Contributions to subsidiaries, net(20)2(12)
Advances to subsidiaries, net(12)-1
Net cash provided (used) by investing activities992801,332
Cash flows from financing activities:
Proceeds from investment agreements232531
Principal paydowns of investment agreements(181)(274)(679)
Payments for securities sold under agreements to repurchase-(32)(639)
Payments for retirement of debt-(3)(180)
Payments for affiliate loans(153)(194)(109)
Purchases of treasury stock(32)--
Restricted stock awards settlements16131
Net cash provided (used) by financing activities(327)(465)(1,575)
Net increase (decrease) in cash and cash equivalents(40)48(40)
Cash and cash equivalents - beginning of year14092132
Cash and cash equivalents - end of year$100$140$92
Reconciliation of net income (loss) to net cash provided (used) by operating activities:
Net income (loss)$569$250$1,234
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Change in:
Intercompany accounts receivable(24)(14)(9)
Current income taxes7011657
Equity in earnings of subsidiaries(463)(118)(762)
Dividends from subsidiaries22521960
Net investment losses related to other-than-temporary impairments--59
Net (gains) losses on financial instruments at fair value and foreign exchange(24)(11)119
Other net realized (gains) losses(1)-(6)
Deferred income tax benefit(176)(207)(613)
(Gains) losses on extinguishment of debt(1)(43)2
Other operating134162
Total adjustments to net income (loss)(381)(17)(1,031)
Net cash provided (used) by operating activities$188$233$203
The condensed financial statements should be read in conjunction with the
consolidated financial statements and notes thereto and the accompanying notes.

SCHEDULE II

MBIA INC. (PARENT COMPANY)

NOTES TO CONDENSED FINANCIAL STATEMENTS

1. Condensed Financial Statements

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the Company’s consolidated financial statements and the notes thereto.

The activities of MBIA Inc. consist of general corporate activities and funding activities, which principally include holding and managing investments, servicing outstanding corporate debt, investment agreements issued by MBIA Inc. and its subsidiaries, and posting collateral under investment agreement and derivative contracts.

MBIA Inc. is subject to the same liquidity risks and uncertainties as described in footnote 1 to the Company’s consolidated financial statements. As of December 31, 2014, MBIA Inc. had $498 million of cash and highly liquid assets available for general corporate liquidity purposes.

2. Significant Accounting Policies

MBIA Inc. (the “Parent Company”) carries its investments in subsidiaries under the equity method.

Certain amounts have been reclassified in prior years’ financial statements to conform to the current presentation. These reclassifications had no impact on total revenues, expenses, assets, liabilities, or shareholders’ equity for all periods presented.

3. Dividends from Subsidiaries

During 2014, National Public Finance Guarantee Holdings, Inc. declared and paid a dividend of $220 million to MBIA Inc. and Trifinium Holdings Limited declared and paid dividends of $5 million to MBIA Inc.

During 2013, National Public Finance Guarantee Holdings, Inc. declared and paid a dividend of $214 million to MBIA Inc., MBIA Services Corporation, formerly Optinuity Alliance Resources Corporation, declared and paid dividends of $2 million to MBIA Inc. and CapMAC Holdings Inc. declared and paid dividends of $3 million to MBIA Inc.

During 2012, MBIA Services Corporation declared and paid dividends of $53 million to MBIA Inc., MBIA Asset Finance, LLC declared and paid dividends of $6 million to MBIA Inc. and Euro Asset Acquisition Limited declared and paid dividends of $1 million to MBIA Inc.

4. Obligations under Investment Agreements

The investment agreement business, as described in footnotes 2 and 10 to the Company’s consolidated financial statements, is conducted by both MBIA Inc. and its wholly owned subsidiary, MBIA Investment Management Corp.

5. Pledged Collateral

Substantially all of the obligations under investment agreements require MBIA Inc. to pledge securities as collateral. As of December 31, 2014 and 2013, the fair value of securities pledged as collateral with respect to these investment agreements approximated $273 million and $270 million, respectively. The Parent Company’s collateral as of December 31, 2014, consisted principally of mortgage-backed securities, corporate obligations, and U.S. Treasury and government agency bonds, and was primarily held with major U.S. banks. Additionally, the Parent Company pledged money market securities as collateral under investment agreements in the amount of $26 million and $22 million as of December 31, 2014 and 2013, respectively.

Under derivative contracts entered into by MBIA Inc., collateral postings are required by either MBIA Inc. or the counterparty when the aggregate market value of derivative contracts entered into with the same counterparty exceeds a predefined threshold. As of December 31, 2014, MBIA Inc. pledged securities with a fair value of $199 million to derivative counterparties. As of December 31, 2013, MBIA Inc. pledged securities with a fair value of $42 million to derivative counterparties.

6. Affiliate Loans Payable

Affiliate loans payable consists of loans payable to MBIA Global Funding, LLC (“GFL”). GFL raised funds through the issuance of medium-term notes with varying maturities, which were, in turn, guaranteed by MBIA Corp. GFL lent the proceeds of these medium-term note issuances to MBIA Inc.