MBIA Inc. is no longer considered by credit-derivatives traders to be in distress after Bank of America Corp. agreed to a legal settlement that injects $1.6 billion of cash into the bond insurer and resolves five years of litigation stemming from the U.S. housing crisis.
Ambac Financial Group Inc., the bond insurer that stopped paying some claims and accepting new business, jumped 71 percent in New York trading after reporting fourth-quarter net income of $558.1 million amid a tax benefit and unrealized gains on derivatives.
MBIA Inc. , the holding company of the world’s largest bond insurer, should be able to make payments on $1 billion of debt until 2015, and will then “barely scrape” through the year, according to CreditSights Inc.
Assured Guaranty Ltd. , the only active insurer of newly issued bonds, fell the most in almost 11 months after reporting first-quarter operating earnings that were lower than analysts forecast, and rival MBIA Inc. , the largest insurer of bonds, also declined.
NMI Holdings Inc., the mortgage guarantor backed by Kyle Bass, Carlyle Group LP and BlueMountain Capital Management LLC, is seeking to be the first U.S. insurer since 2009 to file an initial public offering without posting a profit, as demand climbs for housing-related investments.