Friday, November 02, 2007

MBIA, AMBAC & ACA Update

I suggest to read MBIA / Denial ? from the day MBIA released its earnings before you continue. Since then the stock has lost over 25 percent.

I find some numbers & comments from the MBIA earnings release quite interesting. MBIA has rushed into the RMBS/Commercial Real Estate market. All deals are including 2006 and 2007 commercial loans. Can´t help but i´ve heard some scary things about Commercial Real Estate and looking at CMBS Markit isn´t giving me much comfort either.......

The multi sector CDO´s are also including subprime. The spiking business comes in large part from banks that want to hedge their CMBS and CDO exposure on their balance sheets (after they failed to unload it.....). MBIA believes that their underwriting and their premiums earned are overcompensating their risk (based on their models....) .......They assumed that their worst case for their RMBS ( largely subrime) exposure with a buffer of 22-28 percent was enough when they signed the exposure in the recent years!!!!!!...... Mhhhh........

What will happen to the balance sheets from these banks if MBIA & Co won´t be able to pay the claims..... Just from looking at the chart it feels like at least some have some doubts...... It looks like the report from the short seller Pershing Square Capital Management, L.P. and the post about comon sense wasn´t so far of the mark....
Ich empfehle dringend sich zuvor MBIA / Denial ? durchzulesen. Seitdem hat die Aktie deutlich über 25% nachgegeben.

Ich finde diese Zahl aus der Ergebnisveröffentlichung von MBIA interessant. MBIA ist mit Schaum vorm Mund in den Bereich des gewerblichen Immobilienmarktes gerannt. Alle Papiere basieren Kredite aus den Jahren 2006/2007. Nachdem was ich gehört hat genau dieser Zeitraum den Peak markiert.

Die Multi Sektor CDO´s beinhalten zudem noch Subprimebestandteile. Das explodierende Geschäfft kommt fast ausschließlich von den großen Banken die verzweifelt versuchen die Papiere die sich in Ihren Bilanzen befinden abzusichern ( Nachdem Sie das in den Vorjahren nicht nötig hatten, dort wurden diese Papiere schnell weitergereicht ohne die Bilanzen zu belasten).

MBIA behauptet das die Risikoprämien mehr als ausreichend für die garantierten Risiken sind. Das war bis zu diesem Quartal allerdings auch das Argument für den Rest des Portfolios..... Immerhin haben diese Modelle vorhergesagt das Ihr Puffer von 22-28 % bei den gegebenen Garantien im Immobiliensektor (davon Großteil Subprime) mehr als ausreicht um nicht zur Zahlung herangezogen zu werden....... So kann man sich irren...... Im Nachhinnein sieht der Report vom Shortseller Pershing Square Capital Management, L.P. und über den gesunden Menschenverstand doch nicht so aus der Luft gegriffen aus...... :-)

Unschwer auszurechnen was in den Bilanzen der Banken los ist wenn MBIA sich erneut "verrechnet" hat . Und wenn man sich die Charts ansieht scheinen das zumindest einige zu glauben......

In the third quarter, U.S. structured finance ADP increased 294 percent compared with 2006 ( makes over 50 percent of earned premiums!) Several sectors contributed to the increase in global structured finance production, with particularly strong increases from CMBS pools (over 50 percent!), Collateralized Debt Obligations (CDOs) of investment grade corporate credits, commercial mortgage-backed securities pools and multi-sector (including subprime) CDOs ( 35 percent!) , as well as a whole business securitization, which generated the largest ADP for the quarter


Adjusted Direct Premiums
(dollars in millions)
Three Months

Ended September 30

Nine Months

Ended September 30

2007 2006 % Change 2007 2006 % Change
Global Public Finance

United States

$ 109.6 $ 67.5 62 % $ 259.1 $189.2 37 %

Non-United States

66.9 31.6 112 % 187.7 133.8 40 %

Total

176.5 99.1 78 % 446.8 323.0 38 %
Global Structured Finance
United States 291.0 73.8 294 % 612.5 163.4 275 %
Non-United States 46.7 37.2 26 % 175.2 123.2 42 %
Total 337.7 111.0 204 % 787.7 286.6 175 %
Total $ 514.2 $ 210.1 145 % $ 1,234.5 $609.6 103 %

If you have enough time i think it is well worth listening to the call. Scary! At least a large part from the anaylst are asking the right questions. Remembering that they are on the hook for over $ 600 billion it makes me want to buy more gold......

Wenn Ihr genügend Zeit habt kann ich empfehlen sich den Call anzuhören. Immerhin stellen einige Analysten die richtigen Fragen. Wenn man aber bedenkt das diese Firma über 600 Mrd $ an Garantien ausstehen hat möchte man doch am liebsten gleich seien Goldpsoition aufstocken.....

Replay
of MBIA Inc. Third Quarter 2007 Earnings Conference Call

This is one of the rare things were i am with Cramer Cramer: MBIA Is Toxic

Und das dürfte eine der wenigen Umstände sein das ich mit Carmer übereinstimme Cramer: MBIA Is Toxic

via Mish Downward Spiral of Deep Junk

At Thursday's close, Ambac's swaps implied a rating of "Caa1," seven levels below investment grade and 14 notches below its actual rating.

MBIA Inc's default swap spreads, meanwhile, are trading as though they carry a rating of "B2," five levels below investment grade, and 12 notches below the company's "Aa2" rating, according to Moody's data.Ambac was down another 20% on Friday.

MBIA was down another 6.7%. Clearly the market is beginning to wonder just how much those "guarantees" are worth.

> Looks like the rating agenciues are as usual way behind the curve......

> Sieht mal wieder so aus als wenn die Ratingagenturen mal wieder hoffnungslos der Musik hinterherrennen....

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2 Comments:

Blogger jmf said...


Ambac Debt Cut by Gimme Credit; Shares Fall Most Ever


Ambac Financial Group Inc. bonds were downgraded to ``deteriorating'' from ``stable'' by Gimme Credit Publications Inc. because of the world's second-largest bond insurer's risk from collateralized debt obligations. Ambac's stock price fell as much as 27 percent, the biggest drop ever.

5:24 AM  
Blogger jmf said...

FAZ


Sorgen um die Anleihenversicherer

5:55 AM  

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