In response to investor inquiries, National Public Finance Guarantee Corporation (National), an indirect subsidiary of MBIA Inc. (NYSE: MBI), today confirmed that it has approximately $100.7 million of insured exposure to the general obligation debt of the City of Detroit, Michigan. National has additional exposures to various City of Detroit issues totaling $2.4 billion that are secured by distinct revenue streams.
The following is a summary of National’s insured exposure as of December 31, 2012 to various bonds issued by the City of Detroit:
|Detroit Unlimited Tax GO||$100,725,000|
|General Obligation Exposure||$100,725,000|
City of Detroit Downtown Development Authority Tax Increment Bonds
City of Detroit Downtown Development Authority Convention Facility
|City of Detroit Building Authority Revenue Bonds (Parking & Arena System)||$9,970,000|
|City of Detroit Water Supply System Revenue Bonds||$1,084,452,482|
|City of Detroit Sewage Disposal System Revenue Bonds||$1,208,124,383|
|Revenue Bond Exposure||$2,397,446,050|
|Total City of Detroit Exposure||$2,498,171,050|
“Should the City of Detroit fail to make a required debt service payment for any reason, including a bankruptcy filing, National’s insured bondholders are guaranteed their scheduled interest and principal payments on time and in full,” said Adam Bergonzi, National’s Chief Risk Officer. “National will continue to monitor the situation closely in the coming months as the city and state work to resolve Detroit’s fiscal crisis.”
Copies of the relevant policyholder documentation as well as a comprehensive listing of National’s insured portfolio can be found on National’s website at www.nationalpfg.com.
National, headquartered in Armonk, New York, is the world’s largest U.S. public finance-only financial guarantee insurance company.
This release includes statements that are not historical or current facts and are “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “believe,” “anticipate,” “project,” “plan,” “expect,” “intend,” “will likely result,” “looking forward” or “will continue,” 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. These risks and uncertainties could affect financial performance or could cause actual results to differ materially from estimates contained in or underlying MBIA Inc.’s or National’s forward-looking statements. These risks and uncertainties are discussed under the “Risk Factors” section in MBIA Inc.’s most recent Annual Report on Form 10-K, which may be updated or amended in MBIA Inc.’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.
Kevin Brown, 914-765-3648
Nick Sourbis, 914-765-3385
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