WASHINGTON (dpa-AFX) - MBIA Inc. (MBI) said Thursday that its wholly-owned subsidiary, MBIA Insurance Corp. has entered into an agreement to settle the lawsuit filed by MBIA Corp. in January against Flagstar Bank and certain affiliated entities.
The lawsuit related to about $1.1 billion of securitization transactions backed by second-lien mortgages which were insured by MBIA Corp. in 2006 and 2007.
Under the terms of the settlement agreement, MBIA Corp. will terminate its pending lawsuit against Flagstar and in exchange will receive $110.0 million in cash and other consideration.
MBIA Corp. will use the cash received to repay a portion of its secured loan from National Public Finance Guarantee Corp. in accordance with its terms.
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