Earnings improved on PREPA benefit: MBIA’s 2025 GAAP net loss narrowed to $177 million (‑$3.58/sh) from $447 million in 2024 and adjusted results turned to a $23 million profit, driven mainly by a LAE benefit at National after a custodial‑receipt sale and favorable PREPA loss‑estimate revisions.
Book value remains deeply negative: MBIA’s book value per share fell to negative $44.27 at year‑end 2025, with MBIA Insurance Corp. contributing negative $53.35, highlighting persistent capital strain despite improved operating results.
PREPA is the key unresolved risk: National still holds about $425 million of PREPA gross par outstanding and management expects limited near‑term progress due to legal issues, even as the insured portfolio runs off (gross par down to ~$22 billion) and National’s statutory capital (~$937 million) provides some flexibility for dividends or strategic options.
MBIA (NYSE:MBI) reported lower net losses for full-year 2025 compared with 2024, as management pointed to a favorable swing in loss and loss adjustment expense (LAE) tied largely to National Public Finance Guarantee Corporation’s Puerto Rico Electric Power Authority (PREPA) exposure. Results for the fourth quarter were comparable to the prior-year period on a GAAP basis, according to executives on the company’s year-end earnings call.
CEO Bill Fallon said MBIA posted “lower net losses” in 2025 versus 2024, while the fourth quarters of 2025 and 2024 were “comparable.” A key driver was National’s LAE line, where 2025 included a benefit compared with incurred losses in 2024.
Fallon said National’s LAE in both years “resulted primarily from changes to loss estimates for its PREPA-related exposure.” He attributed the 2025 benefit largely to the sale of a custodial receipt associated with National’s PREPA bankruptcy claims at “prices better than National’s loss estimates,” along with “favorably revised” loss estimates on National’s remaining PREPA exposure.
CFO Joe Schachinger provided the GAAP comparisons:
Fourth-quarter 2025 GAAP net loss: $51 million, or $(1.01) per share, versus a $51 million loss, or $(1.07) per share, in fourth-quarter 2024.
Full-year 2025 GAAP net loss: $177 million, or $(3.58) per share, versus a $447 million loss, or $(9.43) per share, in 2024.
Schachinger said the lower full-year GAAP net loss was driven mainly by lower expenses and, to a lesser extent, higher revenues. He cited the PREPA-related LAE benefit in 2025 versus an expense in 2024, and said the 2025 benefit reflected the PREPA claims sale above the company’s loss recovery estimate and adjustments to PREPA loss scenarios.
On a non-GAAP basis, MBIA’s adjusted results improved year over year. Schachinger said adjusted net loss for the fourth quarter of 2025 was $12 million, or $(0.24) per share, compared with an adjusted net loss of $22 million, or $(0.48) per share, a year earlier. He attributed the improvement primarily to lower LAE at National tied to PREPA.
For full-year 2025, MBIA reported adjusted net income of $23 million, or $0.46 per share, compared with an adjusted net loss of $184 million, or $(3.90) per share, in 2024. Schachinger again highlighted the 2025 LAE benefit at National related to PREPA as the main driver.
Schachinger also said MBIA’s book value per share decreased $3.28 during 2025 to negative $44.27 as of Dec. 31, 2025, primarily due to the consolidated net loss for the year. He added that MBIA Insurance Corp.’s book value contributed negative $53.35 per share to MBIA Inc.’s book value at year-end.
Fallon said resolving National’s PREPA exposure remains the company’s priority, but he noted “not much substantive progress” since the company’s November call. He said management does not expect significant progress until legal issues involving members of the Financial Oversight and Management Board are resolved.
Outside of PREPA, Fallon said the remainder of National’s insured portfolio has performed “generally consistent with our expectations.” He also said National’s insured portfolio continued to run off:
National insured gross par outstanding: down by about $3 billion from year-end 2024 to roughly $22 billion at year-end 2025.
National leverage ratio: 24-to-1 gross par to statutory capital at year-end 2025, down from 28-to-1 at year-end 2024.
National claims-paying resources: $1.4 billion as of Dec. 31, 2025.
National statutory capital surplus: in excess of $900 million as of Dec. 31, 2025.
In the Q&A, Fallon clarified that National still had $425 million of PREPA gross par outstanding, but said the remaining exposure could not be sold using the same custodial receipt approach used previously because the prior sale involved “fully paid” securities. He also said a maturity is coming up later in 2026.
Schachinger said MBIA’s corporate segment—primarily the holding company—had total assets of about $653 million as of Dec. 31, 2025, including $357 million of unencumbered cash and liquid assets, down from $380 million a year earlier. He said the decline was largely due to repayment of MBIA Inc.’s 7% debt that matured in December 2025 and operating expenses, partially offset by a dividend from National.
Schachinger said National declared and paid a $63 million as-of-right dividend to MBIA Inc. in December 2025. He also noted the corporate segment held about $183 million of pledged assets at market value supporting guaranteed investment agreement contract holders.
On statutory reporting, Schachinger said:
National statutory net income: $5 million in Q4 2025 vs. a $10 million loss in Q4 2024; $88 million for full-year 2025 vs. a $133 million loss in 2024.
National statutory capital: $937 million at Dec. 31, 2025, up $25 million year over year, with the increase driven by statutory net income and partially offset by the $63 million dividend.
For MBIA Insurance Corp., Schachinger said statutory results worsened in the quarter but improved for the full year:
MBIA Insurance Corp. statutory net loss: $7 million in Q4 2025 vs. $4 million of statutory net income in Q4 2024, driven by losses reclassified from surplus related to the dissolution of its Mexican subsidiary and higher LAE.
Full-year statutory net loss: $26 million in 2025 vs. a $64 million loss in 2024, reflecting lower LAE tied largely to estimating recoveries of paid claims associated with the Zohar CDOs.
Statutory capital: $79 million at year-end 2025 vs. $88 million at year-end 2024.
Claims-paying resources: $317 million at year-end 2025.
Insured gross par outstanding: about $2 billion at Dec. 31, 2025, down about 13% from year-end 2024 due primarily to amortization.
Analysts asked about the possibility of additional capital returns, including a special dividend from National. Fallon said National has only requested and received one special dividend historically, which occurred in the fourth quarter of 2023, and emphasized that timing is not tied to any specific quarter. He said the company evaluates the possibility “all the time,” and added that as the portfolio runs off and PREPA exposure declines, “the likelihood and the amount of a potential special dividend goes up.” However, management did not provide a timeline, saying it would announce a special dividend only after regulatory approval and distribution.
Fallon also addressed questions about a potential sale of the company. He said MBIA had explored selling the company “a few years ago,” and concluded then that it would be beneficial to pursue a special dividend and make progress on PREPA. Looking ahead, he said “all options are on the table,” including selling the whole company or selling components such as National, depending on what is best for shareholders.
MBIA Inc is a financial guarantee insurance company specializing in credit enhancement and risk mitigation solutions for public finance and structured finance transactions. The company provides guaranty insurance for municipal bonds, asset-backed securities and other credit-sensitive obligations, protecting investors against the risk of payment default. Through its core insurance subsidiary, MBIA Insurance Corp., the firm offers financial guarantees, reinsurance support and customized credit solutions designed to improve the marketability and pricing of debt instruments.
Founded in 1973 as the Municipal Bond Insurance Association, MBIA built its reputation by insuring U.S.
