MBIA: NYSDFS Denied Its Request To Make Jan 15 Interest Payment -8K
MBIA Inc. (NYSE: MBI) announced today that in response to the request made by its wholly-owned subsidiary MBIA Insurance Corporation ("MBIA Corp.") to make the scheduled January 15, 2013 interest payment on MBIA Corp.'s 14% Fixed-to-Floating Rate Surplus Notes due 2033 (the “Surplus Notes”), the New York State Department of Financial Services (“NYSDFS”) has denied MBIA Corp.'s request to make the January 15, 2013 scheduled interest payment on the Surplus Notes.
In accordance with the terms of the Fiscal Agency Agreement governing the Surplus Notes, MBIA Corp. will not make the January 15, 2013 interest payment on the Surplus Notes because pursuant to Section 1307 of the New York Insurance Law and the Fiscal Agency Agreement, any payment on the Surplus Notes may be made only with the prior approval of the NYSDFS, and no such payment becomes due absent NYSDFS approval. Accordingly, MBIA Corp. is not required to make the January 15, 2013 scheduled interest payment under the terms of the Fiscal Agency Agreement, and the non-payment does not constitute a default under the Fiscal Agency Agreement or any other MBIA Corp. or MBIA Inc. agreement. In accordance with the terms of the Fiscal Agency Agreement, MBIA Corp. is required to provide, and will provide, notice to the Fiscal Agent if it has not made a scheduled interest payment.
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