MBIA Inc.

Welcome to the NBIA Inc. First Quarter 2020 Financial Results Conference Call. I would now like to turn the call over to Greg Diamond, Managing Director of Investor and Media Relations at NBIA. Please go ahead, sir.

Thank you, Maria. Welcome to NBIA's conference call for our First Quarter 2020 Financial Results. After the market closed yesterday, we issued and posted several items on our websites, including our financial results, 10Q, quarterly operating supplements, and statutory financial statements for both MBIA Insurance Corporation and National Public Finance Guarantee Corporation. We also posted updates to the listings of our insurance portfolios. Regarding today's call, please note that anything said on this call is qualified by the information provided in the company's 10-K, 10-Q and other SEC filings as our company's definitive disclosures are incorporated in those documents. We urge investors to read our 10-K and 10-Q The definitions and reconciliations of the non-GAAP terms included in our remarks today are also included in our 10-K and 10-Q, as well as our financial results report and quarterly operating supplements. The recorded replay of today's call will become available approximately two hours after the end of the call and the information for accessing it was included in last week's press announcement and in the financial results that we posted on the MBIA website yesterday. Now for our safe harbor statement. Our remarks on today's conference call may contain forward-looking statements. Important factors such as general market conditions and a competitive environment could cause our actual results to differ materially. from the projected results referenced in our forward-looking statements. Risk factors are detailed in our 10-K and 10-Q, which are available on our website at MVIA.com. The company cautions not to place undue reliance on any such forward-looking statements. The company also undertakes no obligation to publicly correct or update any forward-looking statement if it later becomes aware that such statement is no longer accurate. For our call today, Bill Fallon and Anthony McKiernan will provide introductory comments which will be followed by a question and answer session. Now here is Bill Fallon.

Thanks, Greg. Good morning, everyone. Thank you for being with us today. We hope you are well in these challenging times. For the first quarter of 2020, most of the company's net loss was caused by loss and loss adjustment expenses with approximately two-thirds of those loss expenses recorded by MBI Insurance Corporation and the other third by National Public Finance Guarantee Corporation. These elevated losses for the first quarter were modestly influenced by the COVID-19 pandemic. While the pandemic has affected a wide range of economic activities and influenced a number of financial relief and social programs, given the nature of our insured credits and the terms of our insurance policies, the ultimate financial impact for most of the credits in our insurance portfolios is uncertain at this time. In light of the COVID-19 pandemic, We have augmented our monitoring activities on a number of credits in our insurance portfolios. Our loss reserve assessments will continue to be updated as new information becomes available that informs the probability weighted cash flow scenarios used to estimate those losses. Our remaining Puerto Rico exposure is largely comprised of three Puerto Rico credits, the Commonwealth's general obligation bonds, the Puerto Rico Electric Power Authority, or PREPA, and the Puerto Rico Highway and Transportation Authority, or HTA. At March 31, 2020, our exposure to the general obligation bonds was about $655 million of gross par, or about $815 million of total debt service. Our PREPA exposure was $968 million of gross par, or $1.3 billion of total debt service, and our HTA exposure was about $600 million of gross par or $1 billion of total debt service. At this time, the 90-19 motion seeking approval of Title III court where the PREPA restructuring support agreement has been adjourned indefinitely due to the COVID-19 pandemic. The Oversight Board is scheduled to deliver a status report on PREPA on May 15th. There's also a plan of adjustment between the Oversight Board and a group of Commonwealth bondholders representing approximately 55% of the par amount. We and several other large bondholders do not support that proposed agreement, and neither does the Commonwealth government. As yet, there are no specific agreements related to the HTA debt. As I mentioned earlier, due to the COVID-19 pandemic, we have enhanced our review of a number of other credits in the insurance portfolios. Most of the credits in our insurance portfolios continue to perform consistent with our expectations. The outstanding gross par of the insured portfolios continued to reduce. National's insured portfolio has further declined to $47 billion, down approximately $2 billion from year-end 2019. National's leverage ratio of gross part of statutory capital was 23 to 1. During the first quarter, National purchased 8.1 million MBIA's common shares at an average price of $7.99 per share. Year to date through May 4th, 2020, National purchased 12.5 million MBIA shares at an average price of $7.82 per share. As of May 4th, 2020, MBIA had 67.7 million shares outstanding. On May 5th, 2020, Our Board of Directors approved a new share repurchase authorization for $100 million. Now, Anthony will cover the financial results.