Mortgage-related bond insurer MBIA, Armonk, N.Y., generated $1.7 billion in net income in the second quarter, but it took a net loss of $706.4 million for the first six months of the year.
The company said the second-quarter net income gain resulted from "pretax unrealized gains on insured credit derivatives due to wider spreads on credit default swaps." Jay Brown, MBIA chairman and chief executive officer, said the company's "biggest disappointments" in the quarter were "downgrades by Standard & Poor's and Moody's, which had a significant impact on our asset management business and our ability to write new insurance business."
