Capital markets round up: MBIA – The good, the bad and the ugly
MBIA has launched a new public finance-only financial guarantee insurance company, which will conduct business solely in the US. This might look very much like the good bank/bad bank solution that was mooted for the monolines when the financial crisis first broke but according to the firm it is not.
"This is not a good bank/bad bank split, although that is how I expect many observers will report on the change," claims MBIA chairman Jay Brown. "This is a split along structured finance and US public finance lines that was essential as a first step to transform the company, stabilize the business and help unfreeze the US public finance capital markets."