Tuesday, August 10, 2010

MBIA's CMBS losses

Floyd Norris at the NYT reports:
The company said it expected to have to pay out $230 million over time on insurance for CMBS — commercial mortgage backed securities. As Rob Haines of CreditSights pointed out, the company in the past claimed that portfolio was “nearly bulletproof,” although it did cite a $123 million number three months ago. But officials then played down that number, saying they still thought the most probable result was that, in the end, there would be no losses on CMBS exposure.

And, the most laughable comment is directly out of the 10Q:
certain debt coverage ratios have deteriorated in this sector.

A few comments here. MBIA did not wrap CMBS deals. Okay, they did - they wrapped virtually every tranche of every military housing deal, they wrapped the senior tranches on 7 net lease deals between 1999 and 2005, and they wrapped a couple of foreign deals between 1994 and 2003. But that business was nothing compared to selling CDS. I assume they mostly sold CDS on A1-A4 tranches of CMBS deals, but I don't have a good way to look at their holdings. There were always rumblings about some shady dealings going on with MBIA around new issue deals back at the peak of the market, but the rumors seem to be unfounded/unproven.

So, anyone know where they keep their holdings? I don't see a 13f - do they have something similar that they have to file?


crabsofsteel said...


they say that 96% of their CMBS exposure was in the form of CDS

Concrete Jungle said...

Thanks- we discussed that before - they also put out a version in January '08. I want to see CUSIPs - any thoughts?

crabsofsteel said...

You have to look to Intex here. They have a wonderful data search capability under data analysis; however if you don't have the expensive subscription to their CDO database you don't get the data. I am not aware of any BIA disclosure of real CUSIPs.

Concrete Jungle said...

Intex doesn't list holders, though. You can obviously see it through eMaxx or Bloomberg's PHDC function, but generally the CDS lists are not there.

I want to see the .CUSIPs associated with the CDS holdings - I don't think that is available. They claim it is all super dupers, but I gather they might not know or are not being honest.