<SEC-DOCUMENT>0001157523-18-001065.txt : 20180509
<SEC-HEADER>0001157523-18-001065.hdr.sgml : 20180509
<ACCEPTANCE-DATETIME>20180509162652
ACCESSION NUMBER:		0001157523-18-001065
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20180509
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Regulation FD Disclosure
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20180509
DATE AS OF CHANGE:		20180509

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MBIA INC
		CENTRAL INDEX KEY:			0000814585
		STANDARD INDUSTRIAL CLASSIFICATION:	SURETY INSURANCE [6351]
		IRS NUMBER:				061185706
		STATE OF INCORPORATION:			CT
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-09583
		FILM NUMBER:		18818674

	BUSINESS ADDRESS:	
		STREET 1:		1 MANHATTANVILLE ROAD
		STREET 2:		SUITE 301
		CITY:			PURCHASE
		STATE:			NY
		ZIP:			10577
		BUSINESS PHONE:		914-273-4545

	MAIL ADDRESS:	
		STREET 1:		1 MANHATTANVILLE ROAD
		STREET 2:		SUITE 301
		CITY:			PURCHASE
		STATE:			NY
		ZIP:			10577
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>a51804006.htm
<DESCRIPTION>MBIA INC. 8-K
<TEXT>
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      <font style="font-size: 18pt"><b>UNITED STATES</b></font><br><font style="font-size: 18pt"><b>SECURITIES
      AND EXCHANGE COMMISSION</b></font><br><font style="font-size: 14pt"><b>Washington,
      D.C. 20549</b></font>
    </p>
    <p style="text-align: center">
      <font style="font-size: 18pt"><b>FORM 8-K</b></font>
    </p>
    <p style="text-align: center">
      <font style="font-size: 14pt"><b>CURRENT REPORT</b></font>
    </p>
    <p style="text-align: center">
      Pursuant to Section 13 or 15(d) of<br>the Securities Exchange Act of 1934
    </p>
    <p style="text-align: center">
      Date of Report (Date of earliest event reported): <font style="font-size: 10pt; font-family: Times New Roman">May
      9, 2018</font><font style="font-size: 10pt; font-family: Times New Roman"><br style="font-family: Times New Roman; font-size: 10pt"></font>
    </p>
    <p style="text-align: center">
      <font style="font-size: 18pt"><b>MBIA INC.</b></font><br>(Exact name of
      registrant as specified in its charter)
    </p>
<div style="text-align:left">
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      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 31%" valign="top">
          <b>Connecticut</b>
        </td>
        <td style="width: 4%">
          &#160;
        </td>
        <td style="text-align: center; padding-right: 0.0px; padding-left: 0.0px; width: 30%; white-space: nowrap" valign="bottom">
          <b>1-9583</b>
        </td>
        <td style="width: 4%">
          &#160;
        </td>
        <td style="text-align: center; padding-right: 0.0px; padding-left: 0.0px; width: 31%; white-space: nowrap" valign="bottom">
          <b>06-1185706</b>
        </td>
      </tr>
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        <td style="text-align: center; padding-left: 0.0px; width: 31%" valign="top">
          <p style="margin-bottom: 0px; margin-top: 0px">
            (State or other jurisdiction of<br>incorporation)
          </p>
        </td>
        <td style="width: 4%">

        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 30%" valign="top">
          (Commission File Number)
        </td>
        <td style="width: 4%">

        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 31%" valign="top">
          (IRS Employer Identification No.)
        </td>
      </tr>
    </table>
    </div>
    <p style="text-align: center">
      <b><br>
      </b>
    </p>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 10pt">
      <tr>
        <td style="text-align: center; padding-left: 0.0px; width: 50%" valign="top">
          <b>1 Manhattanville Road, Suite 301 </b>

          <p style="margin-bottom: 0px; margin-top: 0px">
            <b>Purchase, New York</b>
          </p>
        </td>
        <td style="text-align: center; padding-right: 0.0px; padding-left: 0.0px; width: 50%; white-space: nowrap" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <b>10577</b>
          </p>
        </td>
      </tr>
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        <td style="text-align: center; padding-left: 0.0px; width: 50%" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            (Address of principal executive offices)
          </p>
        </td>
        <td style="text-align: center; padding-left: 0.0px; width: 50%" valign="bottom">
          (Zip Code)
        </td>
      </tr>
    </table>
    </div>
    <p style="text-align: center">
      Registrant's telephone number, including area code:<br><b>914-273-4545</b>
    </p>
    <p style="text-align: center">

    </p>
    <p style="text-align: center">
      <b>Not Applicable<br></b>(Former name or former address, if changed
      since last report)
    </p>
    <p>

    </p>
    <p>
      Check the appropriate box below if the Form 8-K filing is intended to
      simultaneously satisfy the filing obligation of the registrant under any
      of the following provisions:
    </p>
    <p>
      <font style="font-size: 12pt; font-family: Arial Unicode MS">&#8414;</font>
      Written communications pursuant to Rule 425 under the Securities Act (17
      CFR 230.425)
    </p>
    <p>
      <font style="font-size: 12pt; font-family: Arial Unicode MS">&#8414;</font>
      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
      CFR 240.14a-12)
    </p>
    <p>
      <font style="font-size: 12pt; font-family: Arial Unicode MS">&#8414;</font>
      Pre-commencement communications pursuant to Rule 14d-2(b) under the
      Exchange Act (17 CFR 240.14d-2(b))
    </p>
    <p>
      <font style="font-size: 12pt; font-family: Arial Unicode MS">&#8414;</font>
      Pre-commencement communications pursuant to Rule 13e-4(c) under the
      Exchange Act (17 CFR 240.13e-4(c))
    </p>
    <p style="text-indent: 30.0px; font-size: 10pt">
      Indicate by check mark whether the registrant is an emerging growth
      company as defined in Rule 405 of the Securities Act of 1933 (&#167;230.405
      of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934
      (&#167;240.12b-2 of this chapter).
    </p>
    <p style="text-indent: 30.0px; font-size: 10pt">
      Emerging growth company&#160;&#160;&#9744;
    </p>
    <p style="text-indent: 30.0px; font-size: 10pt">
      If an emerging growth company, indicate by check mark if the registrant
      has elected not to use the extended transition period for complying with
      any new or revised financial accounting standards provided pursuant to
      Section 13(a) of the Exchange Act.&#160;&#160;&#9744;
    </p>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
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        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p style="text-align: left">

    </p>
    <p>
      <b>Item 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.</b>
    </p>
    <p>
      The following information, including Exhibit 99.1 to this Form 8-K, is
      being furnished, not filed, pursuant to Item 2.02 - Results of
      Operations and Financial Condition of Form 8-K.
    </p>
    <p>
      On May 9, 2018, MBIA Inc. (&#8220;MBIA&#8221;) issued a press release announcing its
      results of operations for the quarter ended March 31, 2018. A copy of
      the press release is attached as Exhibit 99.1 to this Form 8-K and is
      incorporated by reference to this Item 2.02 as if fully set forth herein.<br><br><br><b>Item
      7.01. REGULATION FD DISCLOSURE.</b>
    </p>
    <p>
      The following information is being furnished, not filed, pursuant to
      Item 7.01 - Regulation FD Disclosure of Form 8-K. Information contained
      on MBIA&#8217;s Web sites is not incorporated by reference into this Current
      Report on Form 8-K.
    </p>
    <p>
      On May 9, 2018, MBIA will post on its Web site, www.mbia.com, under the
      section &#8220;Investor Relations &#8211; Financial Information &#8211; Operating
      Supplements,&#8221; a Quarterly Operating Supplement for the first quarter of
      2018 and under the section &#8220;Investor Relations &#8211; Financial Information &#8211;
      Statutory Statements,&#8221; 2018 Quarterly Statements for each of MBIA
      Insurance Corporation and National Public Finance Guarantee Corporation.
      MBIA will also post on its Web site, under the section &#8220;Selected
      Exposures,&#8221; certain information on the Company&#8217;s insured portfolios as
      of March 31, 2018. The information will be posted as &#8220;MBIA Corp.&#8217;s
      Structured Finance Insured Portfolio,&#8221; &#8220;MBIA Corp.&#8217;s Non-U.S. Public
      Finance Insured Portfolio&#8221; and &#8220;National Public Finance Guarantee
      Corporation&#8217;s Insured Portfolio.&#8221; Information on National Public Finance
      Guarantee Corporation&#8217;s insured portfolio as of March 31, 2018 will also
      be posted on National Public Finance Guarantee Corporation&#8217;s Web site,
      www.nationalpfg.com, under the selection &#8220;Insured Portfolio.&#8221; Additional
      exposure information on certain credits insured by National Public
      &#160;&#160;&#160;Finance Guarantee Corporation will be posted on National Public
      Finance Guarantee Corporation&#8217;s Web site, www.nationalpfg.com, under the
      selection &#8220;Selected Exposures.&#8221;
    </p>
    <p>
      On or about May 10, 2018, MBIA will also post on its Web site,
      www.mbia.com, under the section &#8220;Investor Relations &#8211; Investor
      Inquiries/FAQs,&#8221; updated Frequently Asked Questions.<br><br><br><b>Item
      9.01. FINANCIAL STATEMENTS AND EXHIBITS.</b>
    </p>
    <p>

    </p>
    <p>
      99.1 Press Release issued by MBIA Inc., dated May 9, 2018, announcing
      its results of operations for the quarter ended March 31, 2018.
    </p>
    <p>

    </p>
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        </div>
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    </div>
    <p style="text-align: center">

    </p>
    <p style="text-align: center">
      <b>SIGNATURES</b>
    </p>
    <p style="text-align: left; text-indent: 30.0px">
      Pursuant to the requirements of the Securities Exchange Act of 1934, the
      registrant has duly caused this report to be signed on its behalf by the
      undersigned hereunto duly authorized.
    </p>
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          &#160;
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          <p style="margin-bottom: 0px; margin-top: 0px">
            MBIA INC.
          </p>
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        <td style="width: 10%">

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        </td>
        <td style="width: 3%">

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        <td style="width: 30%">

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          &#160;
        </td>
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        </td>
        <td style="width: 3%">

        </td>
        <td style="width: 30%">

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        <td style="width: 10%">
          &#160;
        </td>
      </tr>
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        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 2.0px; width: 57%" valign="top">
          <p style="margin-bottom: 0px; margin-top: 0px">
            &#160;
          </p>
        </td>
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          <p style="margin-bottom: 0px; margin-top: 0px">
            <b>By:</b>
          </p>
        </td>
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          <p style="margin-bottom: 0px; margin-top: 0px">
            /s/ Jonathan C. Harris
          </p>
        </td>
        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 2.0px; width: 10%" valign="top">
          <p style="margin-bottom: 0px; margin-top: 0px">
            &#160;
          </p>
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        </td>
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          <p style="margin-bottom: 0px; margin-top: 0px">
            Jonathan C. Harris
          </p>
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        <td style="width: 10%">

        </td>
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        </td>
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          <p style="margin-bottom: 0px; margin-top: 0px">
            General Counsel
          </p>
        </td>
        <td style="width: 10%">

        </td>
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    </table>
    </div>
    <p style="text-align: left">

    </p>
    <p>
      Date: May 9, 2018
    </p>
    <p>

    </p>
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      </div>
    </div>
    <p>

    </p>
    <p style="text-align: center">
      <b>EXHIBIT INDEX TO CURRENT REPORT ON FORM 8-K</b><br>Dated <font style="font-size: 10pt; font-family: Times New Roman">May
      9, 2018</font><font style="font-size: 10pt; font-family: Times New Roman"><br style="font-family: Times New Roman; font-size: 10pt"></font>
    </p>
    <p style="text-align: center">

    </p>
    <p>
      <a href="a51804006ex99_1.htm">99.1&#160;Press Release issued by MBIA Inc.,
      dated May 9, 2018, announcing its results of operations for the quarter
      ended March 31, 2018.</a>
    </p>
    <p style="text-align: center">

    </p>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>a51804006ex99_1.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
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      <b>Exhibit 99.1</b>
    </p>
    <p>
      <u><font style="font-size: 12pt; font-family: Times New Roman"><b>MBIA
      Inc. Reports First Quarter 2018 Financial Results</b></font></u>
    </p>
    <p>
      PURCHASE, N.Y.--(BUSINESS WIRE)--May 9, 2018--MBIA Inc. (NYSE:MBI) (the
      Company) today reported a consolidated GAAP net loss of $98 million, or
      $(1.12) per diluted common share, for the first quarter of 2018 compared
      to a consolidated GAAP net loss of $72 million, or $(0.55) per diluted
      common share, for the first quarter of 2017. Losses before income taxes
      for the first quarter of 2018 declined to $(96) million versus $(120)
      million for the first quarter of 2017. The Company recorded income taxes
      of $2 million for the first quarter of 2018 compared to a tax benefit of
      $48 million for the first quarter of 2017. The adverse variance of
      income tax provision (benefit) primarily reflects the valuation
      allowance against the Company&#8217;s net deferred tax asset for the first
      quarter of 2018 and the absence of a valuation allowance for the first
      quarter of 2017.
    </p>
    <p>
      Book value per share was $13.97 as of March 31, 2018 compared with
      $15.44 as of December 31, 2017. The decrease in book value per share
      since year-end 2017 was due to the consolidated net loss for the
      quarter, partially offset by the reduction of shares outstanding by 2
      million, primarily from the repurchase of MBIA common shares during the
      first quarter of 2018.
    </p>
    <p>
      The Company also reported an Adjusted Net Loss (a non-GAAP measure
      defined in the attached Explanation of Non-GAAP Financial Measures) of
      $61 million or $(0.69) per diluted share for the first quarter of 2018
      compared with Adjusted Net Income of $9 million or $0.07 per diluted
      share for the first quarter of 2017. The negative comparison was
      primarily due to increased losses and loss adjustment expenses at
      National, resulting largely from certain of its Puerto Rico exposures.
    </p>
    <p>
      Adjusted Book Value (ABV) per share (a non-GAAP measure defined in the
      attached Explanation of Non-GAAP Financial Measures) was $28.60 as of
      March 31, 2018 compared with $29.32 as of December 31, 2017. The
      decrease in ABV per share since year-end 2017 was primarily due to
      additional loss and loss adjustment expense reserves at National,
      partially offset by the 2 million reduction of shares outstanding
      resulting primarily from the repurchase of MBIA common shares during the
      first quarter of 2018.
    </p>
    <p>
      Adjusted Net Income (Loss) and ABV per share provide investors with
      views of the Company&#8217;s operating results that management uses in
      measuring financial performance. Reconciliations of ABV per share to
      book value per share, and Adjusted Net Income (Loss) to net income,
      calculated in accordance with GAAP, are attached.
    </p>
    <div style="margin-bottom: 10pt; text-indent: 0pt; margin-right: 0pt; margin-left: 0pt; width: 100%">
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        <div style="text-align: left">

        </div>
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        <div style="text-align: center">

        </div>
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          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
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        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>
      <b>Statement from Company Representative</b>
    </p>
    <p>
      Bill Fallon, MBIA&#8217;s Chief Executive Officer noted, &#8220;Puerto Rico
      continues to prominently influence our day-to-day activities and our
      financial results. Additional losses and loss adjustment expenses
      related to Puerto Rico credits insured by National were the largest
      contributor to our Adjusted Net Loss and reduction to Adjusted Book
      Value for the quarter. We continue to prepare for the eventual
      resolution of our insured Puerto Rico credits with intentions to
      minimize our net losses and pursue maximum recoveries of our paid
      insurance claims.&#8221;
    </p>
    <p>
      <b>MBIA Inc.</b>
    </p>
    <p>
      As of March 31, 2018, MBIA Inc.&#8217;s liquidity position totaled $419
      million, unchanged from December 31, 2017, consisting primarily of cash
      and cash equivalents and other highly liquid invested assets. During the
      first quarter of 2018, $18 million of National&#8217;s 2015 tax payment was
      released to MBIA Inc. from the tax escrow facility and the Company also
      benefitted from lower net collateral posting requirements related to
      swaps contracts and the assets backing the outstanding investment
      agreements. MBIA Inc. also repurchased the $20 million of MBIA Global
      Funding LLC medium-term notes maturing in 2018 during the first quarter
      of 2018.
    </p>
    <p>
      During the first quarter of 2018, National purchased 2.0 million of MBIA
      Inc. common shares at an average price of $7.25 per share. As of May 3,
      2018, there was $236 million remaining under the Company&#8217;s $250 million
      share repurchase authorization that was approved on November 3, 2017 and
      90.5 million of the Company&#8217;s common shares were outstanding. Subsequent
      to quarter-end, MBIA Inc. issued 1.2 million shares of MBIA common
      shares in accordance with the net settlement exercise provisions of
      warrants related to 9.9 million of MBIA common shares.
    </p>
    <p>
      <b>National Public Guarantee Financial Corporation</b>
    </p>
    <p>
      National had statutory capital of $2.7 billion and claims-paying
      resources totaling $4.1 billion as of March 31, 2018. National&#8217;s total
      fixed income investments plus cash and cash equivalents had a
      book/adjusted carrying value of $3.4 billion as of March 31, 2018.
      National&#8217;s insured portfolio declined by $5 billion during the quarter,
      ending the quarter with $67 billion of gross par outstanding. National
      ended the quarter with a leverage ratio of gross par to statutory
      capital of 24 to 1, down from 26 to 1 as of year-end 2017.
    </p>
    <p>
      <b>MBIA Insurance Corporation</b>
    </p>
    <p>
      The statutory capital of MBIA Insurance Corporation as of March 31, 2018
      was $455 million and claims-paying resources totaled $1.5 billion. As of
      March 31, 2018, MBIA Insurance Corporation&#8217;s liquidity position
      (excluding resources from its subsidiary and branch) totaled $130
      million consisting primarily of cash and cash equivalents and liquid
      short-term invested assets.
    </p>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
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        <div style="text-align: left">

        </div>
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        <div style="text-align: center">

        </div>
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          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>
      <b>Conference Call</b>
    </p>
    <p>
      The Company will host a webcast and conference call for investors
      tomorrow, Thursday, May 10, 2018 at 8:00 AM (ET) to discuss its first
      quarter 2018 financial results and other matters relating to the
      Company. The webcast and conference call will consist of brief remarks
      followed by a question and answer session.
    </p>
    <p>
      The dial-in number for the call is (877) 694-4769 in the U.S. and (404)
      665-9935 from outside the U.S. The conference call code is 3195318. A
      live webcast of the conference call will also be accessible on <u>www.mbia.com</u>.
    </p>
    <p>
      A replay of the conference call will become available approximately two
      hours after the completion of the call and will remain available until
      11:59 p.m. on May 24 by dialing (800) 585-8367 in the U.S. or (404)
      537-3406 from outside the U.S. The code for the replay of the call is
      3195318. In addition, a recorded replay of the call will become
      available on the Company's website approximately two hours after the
      completion of the call.
    </p>
    <p>
      <b>Forward-Looking Statements</b>
    </p>
    <p>
      This release includes statements that are not historical or current
      facts and are &#8220;forward-looking statements&#8221; made pursuant to the safe
      harbor provisions of the Private Securities Litigation Reform Act of
      1995. The words &#8220;believe,, &#8220;anticipate,&#8221; &#8220;project,&#8221; &#8220;plan,&#8221; &#8220;expect,&#8221;
      &#8220;estimate,&#8221; &#8220;intend,&#8221; &#8220;will,&#8221; &#8220;will likely result,&#8221; &#8220;looking forward,&#8221;
      or &#8220;will continue,&#8221; and similar expressions identify forward-looking
      statements. These statements are subject to certain risks and
      uncertainties that could cause actual results to differ materially from
      historical earnings and those presently anticipated or projected,
      including, among other factors, the possibility that MBIA Inc. or
      National will experience increased credit losses or impairments on
      public finance obligations issued by state, local and territorial
      governments and finance authorities that are experiencing unprecedented
      fiscal stress; the possibility that loss reserve estimates are not
      adequate to cover potential claims; MBIA Inc.&#8217;s or National&#8217;s ability to
      fully implement their strategic plan; and changes in general economic
      and competitive conditions. These and other factors that could affect
      financial performance or could cause actual results to differ materially
      from estimates contained in or underlying MBIA Inc.&#8217;s or National&#8217;s
      forward-looking statements are discussed under the &#8220;Risk Factors&#8221;
      section in MBIA Inc.&#8217;s most recent Annual Report on Form 10-K and
      Quarterly Report on Form 10-Q, which may be updated or amended in MBIA
      Inc.&#8217;s subsequent filings with the Securities and Exchange Commission.
      MBIA Inc. and National caution readers not to place undue reliance on
      any such forward-looking statements, which speak only to their
      respective dates. National and MBIA Inc. undertake no obligation to
      publicly correct or update any forward-looking statement if it later
      becomes aware that such result is not likely to be achieved.
    </p>
    <p>
      MBIA Inc., headquartered in Purchase, New York is a holding company
      whose subsidiaries provide financial guarantee insurance for the public
      and structured finance markets. Please visit MBIA's website at <u>www.mbia.com</u>.
    </p>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>
      <b>Explanation of Non-GAAP Financial Measures</b>
    </p>
    <p>
      The following are explanations of why the Company believes that the
      non-GAAP financial measures used in this press release, which serve to
      supplement GAAP information, are meaningful to investors.
    </p>
    <p>
      <b>Adjusted Book Value:</b> Adjusted Book Value (ABV), a non-GAAP
      measure, is used by the Company to supplement its analysis of GAAP book
      value. The Company uses ABV as a measure of fundamental value and
      considers the change in ABV an important measure of periodic financial
      performance. ABV adjusts GAAP book value by removing the GAAP book value
      amounts for items that are not expected to impact shareholder value and
      to add in the impact of certain items which the Company believes will be
      realized in GAAP book value in future periods. The Company has limited
      such adjustments to those items that it deems to be important to
      fundamental value and performance and which the likelihood and amount
      can be reasonably estimated. ABV assumes no new business activity. The
      Company has presented ABV to allow investors and analysts to evaluate
      the Company using the same measure that MBIA&#8217;s management regularly uses
      to measure financial performance. ABV is not a substitute for and should
      not be viewed in isolation from GAAP book value.
    </p>
    <p>
      ABV per share represents that amount of ABV allocated to each common
      share outstanding at the measurement date.
    </p>
    <p>
      <b>Claims-paying Resources (CPR)</b>: CPR is a key measure of the
      resources available to National and MBIA Corp. to pay claims under their
      respective insurance policies. CPR consists of total financial resources
      and reserves calculated on a statutory basis. CPR has been a common
      measure used by financial guarantee insurance companies to report and
      compare resources and continues to be used by MBIA&#8217;s management to
      evaluate changes in such resources. The Company has provided CPR to
      allow investors and analysts to evaluate National and MBIA Corp. using
      the same measure that MBIA&#8217;s management uses to evaluate their resources
      to pay claims under their respective insurance policies. There is no
      directly comparable GAAP measure.
    </p>
    <p>
      <b>Adjusted Net Income (Loss)</b>: Adjusted Net Income (Loss) is a
      useful measurement of performance because it measures income from the
      Company excluding its international and structured finance insurance
      segment, which is not part of our ongoing business strategy. Also
      excluded from Adjusted Net Income (Loss) are investment portfolio
      realized gains and losses, gains and losses on financial instruments at
      fair value and foreign exchange, and realized gains and losses on
      extinguishment of debt. Adjusted Net Income (Loss) eliminates the tax
      provision (benefit) as a result of the establishment of a full valuation
      allowance against the Company&#8217;s net deferred tax asset in 2017. Trends
      in the underlying profitability of the Company&#8217;s businesses can be more
      clearly identified without the fluctuating effects of the excluded items
      previously noted. Adjusted Net Income (Loss) as defined by the Company
      does not include all revenues and expenses required by GAAP. Adjusted
      Net Income (Loss) is not a substitute for and should not be viewed in
      isolation from GAAP net income.
    </p>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
    <p>
      Adjusted Net Income (Loss) per share represents that amount of Adjusted
      Net Income (Loss) allocated to each fully diluted weighted-average
      common share outstanding for the measurement period.
    </p>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 8pt">
      <tr>
        <td colspan="8">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>MBIA INC. AND SUBSIDIARIES</b>
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>CONSOLIDATED BALANCE SHEETS (Unaudited)</b>
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          (In millions except share and per share amounts)
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>March 31, 2018</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>December 31, 2017</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <b>Assets</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Investments:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 10.0px; white-space: nowrap" valign="bottom">
          Fixed-maturity securities held as available-for-sale, at fair value
          (amortized cost $3,812 and $3,728)
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          3,757
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          3,712
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Investments carried at fair value
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          228
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          200
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Investments pledged as collateral, at fair value (amortized cost $34
          and $147)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          32
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          148
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Short-term investments, at fair value (amortized cost $448 and $589)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          448
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          589
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          Other investments (includes investments at fair value of $- and $4)
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          1
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          6
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px" valign="bottom">
          Total investments
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          4,466
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          4,655
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Cash and cash equivalents
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          120
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          122
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Premiums receivable
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          368
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          369
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Deferred acquisition costs
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          92
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          95
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Insurance loss recoverable
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          530
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          511
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Other assets
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          134
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          128
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Assets of consolidated variable interest entities:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Cash
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          21
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          24
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Investments held-to-maturity, at amortized cost (fair value $901 and
          $916)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          890
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          890
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Investments carried at fair value
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          176
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          182
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Loans receivable at fair value
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,662
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,679
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Loan repurchase commitments
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          407
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          407
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          Other assets
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          27
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          33
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 4.0px" valign="bottom">
          <b>Total assets</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>8,893</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>9,095</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <b>Liabilities and Equity</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Liabilities:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Unearned premium revenue
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          712
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          752
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Loss and loss adjustment expense reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,006
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          979
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Long-term debt
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,154
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,121
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Medium-term notes (includes financial instruments carried at fair
          value of $146 and $115)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          790
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          765
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Investment agreements
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          330
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          337
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Derivative liabilities
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          219
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          262
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Other liabilities
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          162
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          165
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Liabilities of consolidated variable interest entities:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Variable interest entity notes (includes financial instruments
          carried at fair value of $1,031
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 2.0px" valign="bottom">
          and $1,069)
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          2,260
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          2,289
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 2.0px" valign="bottom">
          <b>Total liabilities</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>7,633</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>7,670</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Equity:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Preferred stock, par value $1 per share; authorized
          shares--10,000,000; issued and outstanding--none
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Common stock, par value $1 per share; authorized
          shares--400,000,000; issued shares--283,569,254
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          and 283,717,973
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          284
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          284
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Additional paid-in capital
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          3,174
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          3,171
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Retained earnings
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,164
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,095
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Accumulated other comprehensive income (loss), net of tax of $7 and
          $16
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (241)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (19)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          Treasury stock, at cost--194,243,689 and 192,233,526 shares
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (3,133)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (3,118)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px" valign="bottom">
          Total shareholders' equity of MBIA Inc.
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,248
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          1,413
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          Preferred stock of subsidiary
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          12
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          12
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 2.0px" valign="bottom">
          <b>Total equity</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>1,260</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>1,425</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 4.0px" valign="bottom">
          <b>Total liabilities and equity</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>8,893</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>9,095</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
    </table>
    </div>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 8pt">
      <tr>
        <td colspan="8">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>MBIA INC. AND SUBSIDIARIES</b>
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)</b>
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          (In millions except share and per share amounts)
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="6" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>Three Months Ended March 31,</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>2018</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>2017</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <b>Revenues:</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Premiums earned:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Scheduled premiums earned
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          23
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          28
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Refunding premiums earned
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          17
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          21
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px" valign="bottom">
          Premiums earned (net of ceded premiums of $1 and $1)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          40
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          49
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net investment income
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          31
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          52
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Fees and reimbursements
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          6
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Change in fair value of insured derivatives:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Realized gains (losses) and other settlements on insured derivatives
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (19)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (31)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Unrealized gains (losses) on insured derivatives
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          14
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (22)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 35.0px" valign="bottom">
          Net change in fair value of insured derivatives
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (5)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (53)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net gains (losses) on financial instruments at fair value and
          foreign exchange
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (9)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          17
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net investment losses related to other-than-temporary impairments:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Investment losses related to other-than-temporary impairments
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Other-than-temporary impairments recognized in accumulated
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 30.0px; padding-bottom: 2.0px" valign="bottom">
          other comprehensive income (loss)
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (1)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (2)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Net investment losses related to other-than-temporary impairments
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (2)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net gains (losses) on extinguishment of debt
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          8
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Other net realized gains (losses)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          3
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Revenues of consolidated variable interest entities:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Net investment income
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          8
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          6
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Net gains (losses) on financial instruments at fair value and
          foreign exchange
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          4
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (33)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Other net realized gains (losses)
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          -
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          28
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Total revenues
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          73
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          77
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="middle">
          <b>Expenses:</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Losses and loss adjustment
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          72
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          94
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Amortization of deferred acquisition costs
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          4
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          7
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Operating
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          20
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          29
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Interest
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          51
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          48
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Expenses of consolidated variable interest entities:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Operating
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Interest
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          20
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          17
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px; padding-bottom: 2.0px" valign="bottom">
          Total expenses
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          169
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          197
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Income (loss) before income taxes
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (96)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (120)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 2.0px" valign="bottom">
          Provision (benefit) for income taxes
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          2
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (48)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 4.0px" valign="bottom">
          <b>Net income (loss)</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>(98)</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>(72)</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="middle">
          <b>Net income (loss) per common share:</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Basic
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1.12)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (0.55)
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Diluted
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1.12)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (0.55)
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="middle">
          <b>Weighted average number of common shares outstanding:</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Basic
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          88,131,373
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          131,402,465
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Diluted
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          88,131,373
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          131,402,465
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
    </table>
    </div>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 8pt">
      <tr>
        <td colspan="12" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <u><b>ADJUSTED NET INCOME (LOSS) RECONCILIATION</b></u><b><u><sup>(1)</sup></u></b>
          </p>
        </td>
      </tr>
      <tr>
        <td colspan="12" style="text-align: center; padding-left: 0.0px" valign="bottom">
          (In millions)
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="9" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>Three Months Ended</b>
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="9" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>March 31,</b>
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>2018</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          <b>2017</b>
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Net income (loss)
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (98
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (72
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Less: adjusted net income (loss) adjustments:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Income (loss) before income taxes of the international and structured
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          finance insurance segment and eliminations
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (36
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (165
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Adjustments to income before income taxes of the U.S. public finance
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          insurance and corporate segments:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Mark-to-market gains (losses) on financial instruments<sup>(2)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          22
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          32
        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Foreign exchange gains (losses)<sup>(2)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (13
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (7
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net gains (losses) on sales of investments<sup>(2)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (5
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2
        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net investment losses related to OTTI
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (2
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Net gains (losses) on extinguishment of debt
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          -
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          8
        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Other net realized gains (losses)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (2
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (1
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Adjusted net income adjustment to the (provision) benefit for
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          income tax<sup>(3)</sup>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (2
        </td>
        <td style="border-bottom-style: solid; text-align: left; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          52
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 4.0px" valign="bottom">
          Adjusted net income (loss)
        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          (61
        </td>
        <td style="border-bottom-style: double; text-align: left; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          9
        </td>
        <td style="border-bottom-style: double; border-bottom-width: 2.25pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          Adjusted net income (loss) per diluted common share
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (0.69
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <sup>(4)</sup>
          </p>
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            &#160;
          </p>
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          0.07
        </td>
        <td>

        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <sup>(5)</sup>
          </p>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
    </table>
    </div>
    <p>
      (1) - A non-GAAP measure; please see Explanation of non-GAAP Financial
      Measures.<br>(2) - Reported within &#8220;Net gains (losses) on financial
      instruments at fair value and foreign exchange&#8221; on the Company&#8217;s
      consolidated statements of operations.<br>(3) - Reported within
      &#8220;Provision (benefit) for income taxes&#8221; on the Company&#8217;s consolidated
      statements of operations.<br>(4) - Adjusted net income (loss) per
      diluted common share is calculated by taking adjusted net income (loss)
      divided by the GAAP weighted average number of diluted common shares
      outstanding.<br>(5) - Adjusted net income (loss) per diluted common
      share is calculated by taking adjusted net income divided by the
      weighted average number of diluted common shares outstanding, which
      includes GAAP diluted weighted average number of common shares of
      131,402,465 and the dilutive effect of common stock equivalents of
      617,622 shares.
    </p>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 8pt">
      <tr>
        <td colspan="8">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="8">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="8" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <u><b>COMPONENTS OF ADJUSTED BOOK VALUE PER SHARE</b></u><b><u><sup>(1)</sup></u></b>
          </p>
        </td>
      </tr>
      <tr>
        <td colspan="8">
          &#160;
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td rowspan="2" colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <b>As of</b><br><b>March 31, 2018</b>
          </p>
        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td rowspan="2" colspan="2" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <b>As of</b><br><b>December 31, 2017</b>
          </p>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <b>Reported Book Value per Share</b>
        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          13.97
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          15.44
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px; padding-bottom: 2.0px" valign="bottom">
          Reverse book value of the MBIA Corp. legal entity<sup> (2)</sup>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          9.32
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          8.84
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Book value after MBIA Corp. legal entity adjustment
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          23.29
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          24.28
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 10.0px" valign="bottom">
          Other book value adjustments:
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px" valign="bottom">
          Reverse net unrealized (gains) losses on available-for-sale
          securities included in other comprehensive income (loss)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          0.70
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          0.26
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Add net unearned premium revenue<sup> (3)</sup>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          4.61
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          4.78
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 20.0px; padding-bottom: 2.0px" valign="bottom">
          Total other book value adjustments per share
        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          5.31
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          5.04
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px; padding-bottom: 4.0px" valign="bottom">
          <b>Adjusted book value per share</b>
        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          28.60
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          29.32
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>
          &#160;
        </td>
      </tr>
    </table>
    </div>
    <p>
      (1) A non-GAAP measure; please see Explanation of Non-GAAP Financial
      Measures.<br>(2) The book value of the MBIA Corp. legal entity does not
      provide significant economic or shareholder value to MBIA Inc.<br>(3)
      Consists of financial guarantee premiums, net of deferred acquisition
      costs. The discount rate on financial guarantee installment premiums was
      the risk-free rate as defined by the accounting principles for financial
      guarantee insurance contracts.
    </p>
    <div style="margin-bottom: 10pt; margin-right: 0pt; text-indent: 0pt; margin-left: 0pt; width: 100%">
      <div>
        <div style="text-align: left">

        </div>
      </div>
      <div style="page-break-after: always">
        <div style="text-align: center">

        </div>
        <div style="text-align: center">
          <hr style="height: 1.5pt; color: black">

        </div>
      </div>
      <div>
        <div style="text-align: right">

        </div>
      </div>
    </div>
<div style="text-align:left">
    <table cellspacing="0" style="margin-bottom: 10.0px; font-family: Times New Roman; width: 100%; font-size: 8pt">
      <tr>
        <td colspan="11">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="11">
          &#160;
        </td>
      </tr>
      <tr>
        <td colspan="11" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>INSURANCE OPERATIONS</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>
          &#160;
        </td>
        <td>
          &#160;
        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <u><b>Selected Financial Data Computed on a Statutory Basis</b></u>
          </p>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          (Dollars in millions)
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <u><b>National Public Finance Guarantee Corporation</b></u>
          </p>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>As of</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>As of</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>March 31, 2018</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>December 31, 2017</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Policyholders' surplus
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,169
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,166
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Contingency reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          565
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          594
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Statutory capital
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,734
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          2,760
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td rowspan="2">

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Unearned premiums
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          554
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          585
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Present value of installment premiums<sup> (1)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          163
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          164
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Premium resources<sup> (2)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          717
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          749
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Net loss and loss adjustment expense reserves<sup> (1)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          201
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          227
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Salvage reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          428
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          387
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px; padding-bottom: 2.0px" valign="bottom">
          Gross loss and loss adjustment expense reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          629
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          614
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 4.0px" valign="bottom">
          Total claims-paying resources
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          4,080
        </td>
        <td style="border-bottom-style: double; border-bottom-width: 2.25pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          4,123
        </td>
        <td style="border-bottom-style: double; border-bottom-width: 2.25pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Net debt service outstanding
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          121,712
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          129,668
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Capital ratio<sup> (3)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          45:1
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          47:1
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Claims-paying ratio<sup> (4)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          31:1
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          33:1
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 0.0px" valign="bottom">
          <p style="margin-bottom: 0px; margin-top: 0px">
            <u><b>MBIA Insurance Corporation</b></u>
          </p>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>As of</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2" style="text-align: center; padding-left: 0.0px" valign="bottom">
          <b>As of</b>
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>March 31, 2018</b>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="3" style="border-bottom-style: solid; text-align: center; border-bottom-width: 1.0pt; padding-left: 0.0px; border-bottom-color: black" valign="bottom">
          <b>December 31, 2017</b>
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Policyholders&#8217; surplus
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          223
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          237
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Contingency reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          232
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          227
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Statutory capital
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          455
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          464
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td rowspan="2">

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Unearned premiums
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          193
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          195
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Present value of installment premiums<sup> (5) (7)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          192
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          192
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px" valign="bottom">
          Premium resources<sup> (2)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          385
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          387
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Net loss and loss adjustment expense reserves<sup> (5)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (801
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          (792
        </td>
        <td style="text-align: left; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          )
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 2.0px" valign="bottom">
          Salvage reserves<sup> (6)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          1,425
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          1,428
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 40.0px; padding-bottom: 2.0px" valign="bottom">
          Gross loss and loss adjustment expense reserves
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          624
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
        <td style="border-bottom-style: solid; text-align: right; border-bottom-width: 1.0pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          636
        </td>
        <td style="border-bottom-style: solid; border-bottom-width: 1.0pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px; padding-bottom: 4.0px" valign="bottom">
          Total claims-paying resources
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          1,464
        </td>
        <td style="border-bottom-style: double; border-bottom-width: 2.25pt; border-bottom-color: black">
          &#160;
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="border-bottom-style: double; text-align: right; border-bottom-width: 2.25pt; padding-right: 0.0px; padding-left: 0.0px; border-bottom-color: black; white-space: nowrap" valign="bottom">
          1,487
        </td>
        <td style="border-bottom-style: double; border-bottom-width: 2.25pt; border-bottom-color: black">
          &#160;
        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Net debt service outstanding
        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          19,736
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          $
        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          20,151
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Capital ratio<sup> (3)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          43:1
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          43:1
        </td>
        <td>

        </td>
      </tr>
      <tr>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td colspan="2">
          &#160;
        </td>
      </tr>
      <tr>
        <td style="text-align: left; padding-left: 25.0px" valign="bottom">
          Claims-paying ratio<sup> (4)</sup>
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          13:1
        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td>

        </td>
        <td style="text-align: right; padding-right: 0.0px; padding-left: 0.0px; white-space: nowrap" valign="bottom">
          14:1
        </td>
        <td>

        </td>
      </tr>
    </table>
    </div>
    <p>
      (1) Calculated using a discount rate of 3.25% as of March 31, 2018 and
      December 31, 2017.<br>(2) Includes financial guarantee and insured
      credit derivative related premiums.<br>(3) Net debt service outstanding
      divided by statutory capital.<br>(4) Net debt service outstanding
      divided by the sum of statutory capital, unearned premium reserve
      (after-tax), present value of installment premiums (after-tax), net loss
      and loss adjustment expense reserves and salvage reserves.<br>(5)
      Calculated using a discount rate of 5.20% as of March 31, 2018 and
      December 31, 2017.<br>(6) This amount primarily consists of expected
      recoveries related to the Company's excess spread, put-backs and CDOs.<br>(7)
      Based on the Company's estimate of the remaining life for its insured
      exposures.
    </p>
    <p>

    </p>
    <p>
      CONTACT:<br><b>MBIA Inc.</b><br>Greg Diamond, 914-765-3190<br>Investor
      and Media Relations<br><u>greg.diamond@mbia.com</u>
    </p>
    <p>

    </p>
  </body>
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</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
