XML 37 R21.htm IDEA: XBRL DOCUMENT
v3.6.0.2

Business Segments | 12 Months Ended
--- | ---
Dec. 31, 2016
Text Block [Abstract] |
Business Segments | Note 12: Business Segments As defined by segment reporting, an operating segment is a component of a company (i) that engages in business activities from which it earns revenue and incurs expenses, (ii) whose operating results are regularly reviewed by the Chief Operating Decision Maker to assess the performance of the segment and to make decisions about the allocation of resources to the segment and, (iii) for which discrete financial information is available. The Company manages its businesses across three oper ating segments: 1) U.S. public finance insurance; 2) corporate; and 3) international and structured finance insurance. The Company’s U.S. public finance insurance business is operated through National and its international and structured finance insurance business is operated through MBIA Corp. Prior to 2015, the Company managed two other operating segments, advisory services and conduit. During 2014, the Company dissolved its conduit segment by extinguishing the remaining liabilities of the segment and liq uidating the Company’s remaining conduit, Meridian. E ffective January 1, 2015, the Company exited its advisory services business with the completed sale of Cutwater to a subsidiary of The Bank of New York Mellon Corporation. The following sections provide a description of each of the Company’s reportable operating segments. U.S. Public Finance Insurance The Company’s U.S. public finance insurance segment is principally conducted through National. The financial guarantees issued by National provide unconditional and irrevocable guarantees of the payment of the principal of, and interest or other amounts owing on, U.S. public finance insure d obligations when due. The obligations are not subject to acceleration, except that National may have the right, at its discretion, to accelerate insured obligations upon default or otherwise. National issues financial guarantees for municipal bonds, incl uding tax-exempt and taxable indebtedness of U.S. political subdivisions, as well as utilit ies, airports, health care institutions, higher educational facilities, student loan issuers, housing authorities and other similar agencies and obligations issued b y private entities that finance projects that serve a substantial public purpose. Municipal bonds and privately issued bonds used for the financing of public purpose projects are generally supported by taxes, assessments, fees or tariffs related to the use of these projects, lease payments or other similar types of revenue streams. Corporate The Company’s corporate segment consists of general corporate activities, including providing general support services to MBIA’s other operating businesses and asset a nd capital management. General support services are provided by the Company’s service company, MBIA Services Corporation (“MBIA Services”). MBIA Services provides various support services including, among others, management, legal, accounting, treasury, in formation technology, and insurance portfolio surveillance, on a fee-for-service basis. Capital management includes activities related to servicing obligations issued by MBIA Inc. and its subsidiaries, MBIA Global Funding, LLC (“GFL”) and MBIA Investment M anagement Corp. (“IMC”). MBIA Inc. issued debt to finance the operations of the MBIA group. GFL raised funds through the issuance of MTNs with varying maturities, which were in turn guaranteed by MBIA Corp. GFL lent the proceeds of these MTN issuances to M BIA Inc. IMC, along with MBIA Inc., provided customized investment agreements, guaranteed by MBIA Corp., for bond proceeds and other public funds for such purposes as construction, loan origination, escrow and debt service or other reserve fund requirement s. The C ompany has ceased issuing these MTNs and investment agreements and the outstanding liability balances and corresponding asset balances have declined over time as liabilities mature, terminate or are retired. All of the debt within the corporate se gment is managed collectively and is serviced by available liquidity. International and Structured Finance Insurance The Company’s international and structured finance insurance segment is principally conducted through MBIA Corp. The financial guarantees issued by MBIA Corp. generally provide unconditional and irrevocable guarantees of the payment of principal of, and interest or other amounts owing on, non-U.S. public finance and global structured finance insured obligations when due, or in the event MBI A Corp. has the right, at its discretion, to accelerate insured obligations upon default or otherwise. MBIA Corp. insures the investment contracts written by MBIA Inc., and if MBIA Inc. were to have insufficient assets to pay amounts due upon maturity or t ermination, MBIA Corp. would make such payments. MBIA Corp. insures debt obligations of the following affiliates: MBIA Inc.; GFL; IMC; and LaCrosse Financial Products, LLC, a wholly-owned affiliate, in which MBIA Insurance Corp oration has written insurance policies guaranteeing the obligations under CDS. Certain policies cover payments potentially due under CDS, including termination payments that may become due in certain circumstances, including the occurrence of certain insolvency o r payment defaults under the CDS or derivatives contracts by the insured counterparty or by the guarantor. MBIA Corp. insure s non-U.S. public finance and global structured finance insured obligations, including asset-backed obligations. MBIA Corp. has insured sovereign-related and sub-sovereign bonds, utilities, privately issued bonds used for th e financing of projects that include toll roads, bridges, airports, public transportation facilities, and other types of infrastructure projects serving a substantial public purpose. Global structured finance and asset-backed obligations typically are secu rities repayable from expected cash flows generated by a specified pool of assets, such as residential and commercial mortgages, insurance policies, consumer loans, corporate loans and bonds, trade and export receivables, and leases for equipment, aircraft and real estate property. MBIA Corp. has also written policies guaranteeing obligations under certain other derivative contracts, including termination payments that may become due upon certain insolvency or payment defaults of the financial guarantor or the issuer. The Company is no longer insuring new credit derivative contracts except for transactions related to the restructuring or reduction of existing derivative exposure. MBIA Corp. has not written any meaningful amount of business since 2008. Adviso ry Services The advisory services segment primarily consisted of the operations of Cutwater Investor Services Corp. and Cutwater Asset Management Corp. and was a fee-for-service investment management business focused on fixed-income markets. Effective with the January 1, 2015 sale of Cutwater, MBIA has no business activities within its advisory services segment. Conduit The Company’s conduit segment was operated through Meridian and administered through MBIA Asset Finance, LLC. Assets financed by Meridian were funded by MTNs. In 2014, the Company extinguished the remaining liabilities of this segment and liquidated Meridian. Segments Results The following tables provide the Company’s segment results for the years ended December 31, 2016, 2015 and 2014:
|  |  |  | Year Ended December 31, 2016
|  |  |  | U.S. |  |  |  | International |  |  |  |  |  |
|  |  |  | Public |  |  |  | and Structured |  |  |  |  |  |
|  |  |  | Finance |  |  |  | Finance |  |  |  |  |  |
In millions |  | Insurance |  | Corporate |  | Insurance |  | Eliminations |  | Consolidated
Revenues(1) |  | $ | 335 |  | $ | 24 |  | $ | 121 |  | $ | - |  | $ | 480
Net change in fair value of insured derivatives |  |  | - |  |  | - |  |  | (19) |  |  | - |  |  | (19)
Net gains (losses) on financial instruments at fair value and |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| foreign exchange |  |  | 72 |  |  | (14) |  |  | 26 |  |  | - |  |  | 84
Net investment losses related to other-than-temporary impairments |  |  | (4) |  |  | (1) |  |  | - |  |  | - |  |  | (5)
Net gains (losses) on extinguishment of debt |  |  | - |  |  | 5 |  |  | - |  |  | - |  |  | 5
Other net realized gains (losses) |  |  | 2 |  |  | (5) |  |  | (279) |  |  | - |  |  | (282)
Revenues of consolidated VIEs |  |  | - |  |  | - |  |  | 31 |  |  | - |  |  | 31
Inter-segment revenues(2) |  |  | 22 |  |  | 58 |  |  | 51 |  |  | (131) |  |  | -
|  | Total revenues |  |  | 427 |  |  | 67 |  |  | (69) |  |  | (131) |  |  | 294
Losses and loss adjustment |  |  | 74 |  |  | - |  |  | 146 |  |  | - |  |  | 220
Operating |  |  | 40 |  |  | 80 |  |  | 57 |  |  | - |  |  | 177
Interest |  |  | - |  |  | 91 |  |  | 106 |  |  | - |  |  | 197
Expenses of consolidated VIEs |  |  | - |  |  | - |  |  | 39 |  |  | - |  |  | 39
Inter-segment expenses(2) |  |  | 69 |  |  | 4 |  |  | 52 |  |  | (125) |  |  | -
|  | Total expenses |  |  | 183 |  |  | 175 |  |  | 400 |  |  | (125) |  |  | 633
Income (loss) before income taxes |  |  | 244 |  |  | (108) |  |  | (469) |  |  | (6) |  |  | (339)
Provision (benefit) for income taxes |  |  | 68 |  |  | (15) |  |  | (52) |  |  | (2) |  |  | (1)
Net income (loss) |  | $ | 176 |  | $ | (93) |  | $ | (417) |  | $ | (4) |  | $ | (338)
Identifiable assets |  | $ | 5,077 |  | $ | 2,479 |  | $ | 6,486 |  | $ | (2,905) | (3) | $ | 11,137
________________ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
(1) - Represents the sum of third-party financial guarantee net premiums earned, net investment income, insurance-related fees and reimbursements and other fees.
(2) - Represents intercompany premium income and expense and intercompany interest income and expense pertaining to intercompany receivables and payables.
(3) - Consists of intercompany deferred income taxes, reinsurance balances and repurchase agreements.
|  |  |  | Year Ended December 31, 2015
|  |  |  | U.S. |  |  |  | International |  |  |  |  |  |
|  |  |  | Public |  |  |  | and Structured |  |  |  |  |  |
|  |  |  | Finance |  |  |  | Finance |  |  |  |  |  |
In millions |  | Insurance |  | Corporate |  | Insurance |  | Eliminations |  | Consolidated
Revenues(1) |  | $ | 389 |  | $ | 27 |  | $ | 114 |  | $ | - |  | $ | 530
Net change in fair value of insured derivatives |  |  | - |  |  | - |  |  | 129 |  |  | - |  |  | 129
Net gains (losses) on financial instruments at fair value and |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| foreign exchange |  |  | 14 |  |  | 58 |  |  | (9) |  |  | - |  |  | 63
Net investment losses related to other-than-temporary impairments |  |  | (10) |  |  | (3) |  |  | - |  |  | - |  |  | (13)
Net gains (losses) on extinguishment of debt |  |  | - |  |  | (1) |  |  | - |  |  | - |  |  | (1)
Other net realized gains (losses) |  |  | (4) |  |  | 21 |  |  | - |  |  | - |  |  | 17
Revenues of consolidated VIEs |  |  | - |  |  | - |  |  | 128 |  |  | - |  |  | 128
Inter-segment revenues(2) |  |  | 34 |  |  | 67 |  |  | 63 |  |  | (164) |  |  | -
|  | Total revenues |  |  | 423 |  |  | 169 |  |  | 425 |  |  | (164) |  |  | 853
Losses and loss adjustment |  |  | 5 |  |  | - |  |  | 118 |  |  | - |  |  | 123
Operating |  |  | 38 |  |  | 79 |  |  | 73 |  |  | - |  |  | 190
Interest |  |  | - |  |  | 97 |  |  | 102 |  |  | - |  |  | 199
Expenses of consolidated VIEs |  |  | - |  |  | - |  |  | 52 |  |  | - |  |  | 52
Inter-segment expenses(2) |  |  | 89 |  |  | 7 |  |  | 64 |  |  | (160) |  |  | -
|  | Total expenses |  |  | 132 |  |  | 183 |  |  | 409 |  |  | (160) |  |  | 564
Income (loss) before income taxes |  |  | 291 |  |  | (14) |  |  | 16 |  |  | (4) |  |  | 289
Provision (benefit) for income taxes |  |  | 100 |  |  | 7 |  |  | 3 |  |  | (1) |  |  | 109
Net income (loss) |  | $ | 191 |  | $ | (21) |  | $ | 13 |  | $ | (3) |  | $ | 180
Identifiable assets |  | $ | 5,265 |  | $ | 2,599 |  | $ | 9,870 |  | $ | (2,898) | (3) | $ | 14,836
________________ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
(1) - Represents the sum of third-party financial guarantee net premiums earned, net investment income, insurance-related fees and reimbursements and other fees.
(2) - Represents intercompany premium income and expense and intercompany interest income and expense pertaining to intercompany receivables and payables.
(3) - Consists of intercompany deferred income taxes, reinsurance balances and repurchase agreements.
|  |  |  | Year Ended December 31, 2014
|  |  |  | U.S. |  |  |  |  | International |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  | Public |  |  |  |  | and Structured |  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  | Finance |  |  |  | Finance |  | Advisory |  |  |  |  |  |  |  |  |
In millions |  | Insurance |  | Corporate |  | Insurance |  | Services |  | Conduit |  | Eliminations |  |  | Consolidated
Revenues(1) |  | $ | 373 |  | $ | 42 |  | $ | 189 |  | $ | 12 |  | $ | - |  | $ | - |  |  | $ | 616
Net change in fair value of |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| insured derivatives |  |  | 1 |  |  | - |  |  | 458 |  |  | - |  |  | - |  |  | - |  |  |  | 459
Net gains (losses) on financial |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| instruments at fair value and |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| foreign exchange |  |  | 26 |  |  | 55 |  |  | - |  |  | (3) |  |  | - |  |  | - |  |  |  | 78
Net investment losses related |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| to other-than-temporary |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| impairments |  |  | (15) |  |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  |  | (15)
Net gains (losses) on |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| extinguishment of debt |  |  | - |  |  | 3 |  |  | - |  |  | - |  |  | - |  |  | - |  |  |  | 3
Other net realized gains (losses) |  |  | 14 |  |  | 2 |  |  | 12 |  |  | - |  |  | - |  |  | - |  |  |  | 28
Revenues of consolidated VIEs |  |  | - |  |  | - |  |  | 105 |  |  | (8) |  |  | 4 |  |  | - |  |  |  | 101
Inter-segment revenues(2) |  |  | 44 |  |  | 46 |  |  | 55 |  |  | 22 |  |  | (1) |  |  | (166) |  |  |  | -
|  | Total revenues |  |  | 443 |  |  | 148 |  |  | 819 |  |  | 23 |  |  | 3 |  |  | (166) |  |  |  | 1,270
Losses and loss adjustment |  |  | (10) |  |  | - |  |  | 143 |  |  | - |  |  | - |  |  | - |  |  |  | 133
Operating |  |  | 38 |  |  | 87 |  |  | 72 |  |  | 42 |  |  | - |  |  | - |  |  |  | 239
Interest |  |  | - |  |  | 101 |  |  | 109 |  |  | - |  |  | - |  |  | - |  |  |  | 210
Expenses of consolidated VIEs |  |  | - |  |  | - |  |  | 47 |  |  | - |  |  | - |  |  | - |  |  |  | 47
Inter-segment expenses(2) |  |  | 78 |  |  | 15 |  |  | 64 |  |  | 6 |  |  | 9 |  |  | (172) |  |  |  | -
|  | Total expenses |  |  | 106 |  |  | 203 |  |  | 435 |  |  | 48 |  |  | 9 |  |  | (172) |  |  |  | 629
Income (loss) before income taxes |  |  | 337 |  |  | (55) |  |  | 384 |  |  | (25) |  |  | (6) |  |  | 6 |  |  |  | 641
Provision (benefit) for income taxes |  |  | 115 |  |  | (173) |  |  | 134 |  |  | (6) |  |  | - |  |  | 2 |  |  |  | 72
Net income (loss) |  | $ | 222 |  | $ | 118 |  | $ | 250 |  | $ | (19) |  | $ | (6) |  | $ | 4 |  |  | $ | 569
Identifiable assets |  | $ | 5,887 |  | $ | 2,838 |  | $ | 10,073 |  | $ | 793 |  | $ | - |  | $ | (3,328) | (3) |  | $ | 16,263
________________ |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
(1) - Represents the sum of third-party financial guarantee net premiums earned, net investment income, insurance-related fees and reimbursements, investment management fees and
other fees.
(2) - Represents intercompany premium income and expense, intercompany asset management fees and expenses, intercompany interest income and expenses pertaining to
intercompany receivables and payables and intercompany loans.
(3) - Consists of intercompany reinsurance balances, repurchase agreements and deferred income taxes.
Pr e m iu ms o n f inan c ia l g u a r an t ee s a n d i n s u r e d de r i v a t i v e s r ep o r t e d wi t hi n t h e C o m p an y’s i n s u r an ce s e g m e n t s a re gen e r a t e d wi t hi n a n d o u t s id e t h e U.S. T h e f o l lowin g t abl e s u m m a r i z e s p r e m iu ms ea r ne d o n f i nan c ia l gu a r a n t e e s and in s u r e d d e r i v a t i v e s b y g eog r aph i c l o c a t i o n o f r i sk f o r t h e years ended December 31, 2016, 2015 and 2014:
|  |  |  | Years Ended December 31, |
| In millions |  |  | 2016 |  |  | 2015 |  |  | 2014 |
| Total premiums earned: |  |  |  |  |  |  |  |  |  |
|  | United States |  | $ | 238 |  | $ | 310 |  | $ | 299 |
|  | United Kingdom |  |  | 27 |  |  | 30 |  |  | 36 |
|  | Europe (excluding United Kingdom) |  |  | 4 |  |  | 4 |  |  | 7 |
|  | Internationally diversified |  |  | 3 |  |  | 3 |  |  | 9 |
|  | Other Americas |  |  | 26 |  |  | 29 |  |  | 49 |
|  | Asia |  |  | 2 |  |  | 3 |  |  | 4 |
|  | Other |  |  | 4 |  |  | 6 |  |  | 12 |
| Total |  | $ | 304 |  | $ | 385 |  | $ | 416 |

X
- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8981-108599 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9038-108599 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 33 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8971-108599 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8595-108599 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8380-108599 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8984-108599 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9031-108599 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e9054-108599 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8538-108599 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 29 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8864-108599 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8924-108599 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 30 -URI http://asc.fasb.org/extlink&oid=51669610&loc=d3e8906-108599 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_TextBlockAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration