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Fair Value of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2017

Quantitative Information Regarding The Significant Unobservable Inputs For Certain Assets And Liabilities Measured At Fair Value On A Recurring Basis

		Fair Value
		as of				Range
		September 30,				(Weighted
In millions		2017		Valuation Techniques	Unobservable Input	Average)
Assets of consolidated VIEs:
	Loans receivable at fair value	$	1,632	Market prices adjusted for financial	Impact of financial guarantee	0% - 34% (6%)
				guarantees provided to VIE obligations
				Discounted cash flow	Multiples⁽¹⁾

	Loan repurchase commitments		406	Discounted cash flow	Recovery rates⁽²⁾
					Breach rates⁽²⁾

Liabilities of consolidated VIEs:
	Variable interest entity notes		430	Market prices of VIE assets adjusted for	Impact of financial guarantee	0% - 65% (39%)
				financial guarantees provided

Credit derivative liabilities, net:
	CMBS and multi-sector CDO		74	Direct Price Model	Nonperformance risk	46% - 46% (46%)

Other derivative liabilities			4	Discounted cash flow	Cash flows	$0 - $49 ($25)⁽³⁾

____________
(1) - Unobservable inputs are primarily based on comparable companies' EBITDA multiples.
(2) - Recovery rates and breach rates include estimates about potential variations in the outcome of litigation with a counterparty.
(3) - Midpoint of cash flows are used for the weighted average.

		Fair Value
		as of				Range
		December 31,				(Weighted
In millions		2016		Valuation Techniques	Unobservable Input	Average)
Assets of consolidated VIEs:
	Loans receivable at fair value	$	916	Market prices adjusted for financial	Impact of financial guarantee	0% - 28% (3%)
				guarantees provided to VIE obligations
				Discounted cash flow	Multiples⁽¹⁾

	Loan repurchase commitments		404	Discounted cash flow	Recovery rates⁽²⁾
					Breach rates⁽²⁾

Liabilities of consolidated VIEs:
	Variable interest entity notes		476	Market prices of VIE assets	Impact of financial guarantee	0% - 54% (24%)
				adjusted for financial guarantees provided

Credit derivative liabilities, net:
					Recovery rates	25% - 40% (33%)
	CMBS		62	BET Model	Nonperformance risk	10% - 32% (32%)
					Weighted average life (in years)	1.1 - 1.5 (1.3)
					CMBS spreads	25% - 35% (30%)
	Multi-sector CDO		2	Direct Price Model	Nonperformance risk	58% - 58% (58%)

Other derivative liabilities			20	Discounted cash flow	Cash flows	$0 - $83 ($42)⁽³⁾
	____________
	(1) - Unobservable inputs are primarily based on comparable companies' EBITDA multiples.
	(2) - Recovery rates and breach rates include estimates about potential variations in the outcome of litigation with a counterparty.
	(3) - Midpoint of cash flows are used for the weighted average.

Company's Assets And Liabilities Measured At Fair Value On Recurring Basis

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in		Significant
				Active Markets		Other		Significant			Counterparty
				for Identical		Observable		Unobservable			and Cash		Balance as of
				Assets		Inputs		Inputs			Collateral		September 30,
In millions				(Level 1)		(Level 2)		(Level 3)			Netting		2017
Assets:
Fixed-maturity investments:
	U.S. Treasury and government agency			$	724	$	93	$	-		$	-	$	817
	State and municipal bonds				-		1,113		-			-		1,113
	Foreign governments				-		8		-			-		8
	Corporate obligations				-		1,511		-			-		1,511
	Mortgage-backed securities:
		Residential mortgage-backed agency			-		699		-			-		699
		Residential mortgage-backed non-agency			-		36		-			-		36
		Commercial mortgage-backed			-		51		-			-		51
	Asset-backed securities:
		Collateralized debt obligations			-		72		-			-		72
		Other asset-backed			-		315		5	⁽¹⁾		-		320
			Total fixed-maturity investments		724		3,898		5			-		4,627
Money market securities					269		-		-			-		269
Perpetual debt and equity securities					26		21		-			-		47
Fixed-income fund					-		-		-			-		81	⁽²⁾
Cash and cash equivalents					116		-		-			-		116
Derivative assets:
	Non-insured derivative assets:
		Interest rate derivatives			-		3		-			-		3

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in		Significant
				Active Markets		Other		Significant			Counterparty
				for Identical		Observable		Unobservable			and Cash		Balance as of
				Assets		Inputs		Inputs			Collateral		September 30,
In millions				(Level 1)		(Level 2)		(Level 3)			Netting		2017
Assets of consolidated VIEs:
	Corporate obligations				-		20		-			-		20
	Mortgage-backed securities:
		Residential mortgage-backed non-agency			-		111		-			-		111
		Commercial mortgage-backed			-		39		-			-		39
	Asset-backed securities:
		Collateralized debt obligations			-		8		1	⁽¹⁾		-		9
		Other asset-backed			-		10		-			-		10
	Cash				20		-		-			-		20
	Loans receivable at fair value:
		Residential loans receivable			-		-		759			-		759
		Corporate loans receivable			-		-		873			-		873
	Loan repurchase commitments				-		-		406			-		406
	Other assets:
		Currency derivatives			-		-		13	⁽¹⁾		-		13
		Other			-		-		17	⁽¹⁾		-		17
Total assets				$	1,155	$	4,110	$	2,074		$	-	$	7,420
Liabilities:
Medium-term notes				$	-	$	-	$	127	⁽¹⁾	$	-	$	127
Derivative liabilities:
	Insured derivatives:
		Credit derivatives			-		2		74			-		76
	Non-insured derivatives:
		Interest rate derivatives			-		204		-			-		204
		Other			-		-		4			-		4
Other liabilities:
	Warrants				-		12		-			-		12
	Other payable				-		-		7	⁽¹⁾		-		7
Liabilities of consolidated VIEs:
	Variable interest entity notes				-		710		430			-		1,140
Total liabilities				$	-	$	928	$	642		$	-	$	1,570
____________
(1) - Unobservable inputs are either not developed by the Company or do not significantly impact the overall fair values of the aggregate financial assets and liabilities.
(2) - Investment that was measured at fair value by applying the net asset value per share practical expedient, and was required not to be classified in the fair value hierarchy.

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in		Significant
				Active Markets		Other		Significant			Counterparty
				for Identical		Observable		Unobservable			and Cash		Balance as of
				Assets		Inputs		Inputs			Collateral		December 31,
In millions				(Level 1)		(Level 2)		(Level 3)			Netting		2016
Assets:
Fixed-maturity investments:
	U.S. Treasury and government agency			$	825	$	112	$	-		$	-	$	937
	State and municipal bonds				-		1,440		-			-		1,440
	Foreign governments				-		9		-			-		9
	Corporate obligations				-		1,332		2	⁽¹⁾		-		1,334
	Mortgage-backed securities:
		Residential mortgage-backed agency			-		868		-			-		868
		Residential mortgage-backed non-agency			-		45		-			-		45
		Commercial mortgage-backed			-		43		-			-		43
	Asset-backed securities:
		Collateralized debt obligations			-		7		15	⁽¹⁾		-		22
		Other asset-backed			-		257		44	⁽¹⁾		-		301
			Total fixed-maturity investments		825		4,113		61			-		4,999
Money market securities					521		-		-			-		521
Perpetual debt and equity securities					26		9		-			-		35
Fixed-income fund					-		-		-			-		75	⁽²⁾
Cash and cash equivalents					163		-		-			-		163
Derivative assets:
	Non-insured derivative assets:
		Interest rate derivatives			-		3		-			-		3

				Fair Value Measurements at Reporting Date Using
				Quoted Prices in		Significant
				Active Markets		Other		Significant			Counterparty
				for Identical		Observable		Unobservable			and Cash		Balance as of
				Assets		Inputs		Inputs			Collateral		December 31,
In millions				(Level 1)		(Level 2)		(Level 3)			Netting		2016
Assets of consolidated VIEs:
	Corporate obligations				-		27		-			-		27
	Mortgage-backed securities:
		Residential mortgage-backed non-agency			-		149		-			-		149
		Commercial mortgage-backed			-		52		-			-		52
	Asset-backed securities:
		Collateralized debt obligations			-		7		1	⁽¹⁾		-		8
		Other asset-backed			-		18		1	⁽¹⁾		-		19
	Cash				24		-		-			-		24
	Loans receivable at fair value:
		Residential loans receivable			-		-		916			-		916
		Corporate loans receivable			-		-		150	⁽¹⁾		-		150
	Loan repurchase commitments				-		-		404			-		404
	Derivative assets:
		Currency derivatives			-		-		19	⁽¹⁾		-		19
Total assets				$	1,559	$	4,378	$	1,552		$	-	$	7,564
Liabilities:
Medium-term notes				$	-	$	-	$	101	⁽¹⁾	$	-	$	101
Derivative liabilities:
	Insured derivatives:
		Credit derivatives			-		2		64			-		66
	Non-insured derivatives:
		Interest rate derivatives			-		213		-			-		213
		Other			-		-		20			-		20
Other liabilities:
	Warrants				-		33		-			-		33
Liabilities of consolidated VIEs:
	Variable interest entity notes				-		875		476			-		1,351
Total liabilities				$	-	$	1,123	$	661		$	-	$	1,784
____________
(1) - Unobservable inputs are either not developed by the Company or do not significantly impact the overall fair values of the aggregate financial assets and liabilities.
(2) - Investment that was measured at fair value by applying the net asset value per share practical expedient, and was required not to be classified in the fair value hierarchy.

Fair Value Hierarchy Table Presents The Company's Assets And Liabilities Not Recorded At Fair Value On The Company's Consolidated Balance Sheet

		Fair Value Measurements at Reporting Date Using
		Quoted Prices in		Significant		Significant		Fair Value		Carry Value
		Active Markets for		Other Observable		Unobservable		Balance as of		Balance as of
		Identical Assets		Inputs		Inputs		September 30,		September 30,
In millions		(Level 1)		(Level 2)		(Level 3)		2017		2017
Assets:
	Other investments	$	-	$	2	$	-	$	2	$	2
	Accrued investment income⁽¹⁾		-		28		-		28		28
	Receivable for investments sold⁽¹⁾		-		49		-		49		49
Assets of consolidated VIEs:
	Investments held-to-maturity		-		-		897		897		890
Total assets		$	-	$	79	$	897	$	976	$	969
Liabilities:
	Long-term debt	$	-	$	1,054	$	-	$	1,054	$	2,093
	Medium-term notes		-		-		497		497		771
	Investment agreements		-		-		453		453		350
	Payable for investments purchased⁽²⁾		-		74		-		74		74
	Interest payable for derivatives⁽²⁾		-		15		-		15		15
Liabilities of consolidated VIEs:
	Variable interest entity notes		-		353		897		1,250		1,212
Total liabilities		$	-	$	1,496	$	1,847	$	3,343	$	4,515
Financial Guarantees:
	Gross	$	-	$	-	$	2,116	$	2,116	$	1,015
	Ceded		-		-		71		71		36
__________
(1) - Reported within "Other assets" on MBIA's consolidated balance sheets.
(2) - Reported within "Other liabilities" on MBIA's consolidated balance sheets.

		Fair Value Measurements at Reporting Date Using
		Quoted Prices in		Significant		Significant		Fair Value		Carry Value
		Active Markets for		Other Observable		Unobservable		Balance as of		Balance as of
		Identical Assets		Inputs		Inputs		December 31,		December 31,
In millions		(Level 1)		(Level 2)		(Level 3)		2016		2016
Assets:
	Other investments	$	-	$	2	$	-	$	2	$	3
	Accrued investment income⁽¹⁾		-		40		-		40		40
	Assets held for sale		-		306		-		306		306
Assets of consolidated VIEs:
	Investments held-to-maturity		-		-		876		876		890
Total assets		$	-	$	348	$	876	$	1,224	$	1,239
Liabilities:
	Long-term debt	$	-	$	1,030	$	-	$	1,030	$	1,986
	Medium-term notes		-		-		478		478		794
	Investment agreements		-		-		508		508		399
	Payable for investments purchased⁽²⁾		-		32		-		32		32
Liabilities of consolidated VIEs:
	Variable interest entity notes		-		-		882		882		890
Total liabilities		$	-	$	1,062	$	1,868	$	2,930	$	4,101
Financial Guarantees:
	Gross	$	-	$	-	$	2,638	$	2,638	$	995
	Ceded		-		-		18		18		43
__________
(1) - Reported within "Other assets" on MBIA's consolidated balance sheets.
(2) - Reported within "Other liabilities" on MBIA's consolidated balance sheets.

Changes In Level 3 Assets Measured At Fair Value On A Recurring Basis

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended September 30, 2017
																									Change in
																									Unrealized
																									Gains
																									(Losses) for
																									the Period
																									Included in
					Unrealized																				Earnings
					Gains /		Unrealized		Foreign																for Assets
					(Losses)		Gains /		Exchange																still held
	Balance,		Realized		Included		(Losses)		Recognized										Transfers		Transfers				as of
	Beginning		Gains /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Period		(Losses)		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2017
Assets:
Commercial
mortgage-backed		7		-		-		-		-		-		-		-		-		-		(7)		-		-
Other asset-backed		5		-		-		-		-		-		-		-		-		-		-		5		-
Assets of
consolidated VIEs:
Commercial
mortgage-backed		3		-		-		-		-		-		-		-		(3)		-		-		-		-
Collateralized debt
obligations		1		-		-		-		-		-		-		-		-		-		-		1		-
Loans receivable-
residential		815		-		2		-		-		-		-		(58)		-		-		-		759		2
Loans receivable-
corporate		875		-		4		-		-		-		-		(6)		-		-		-		873		4
Loan repurchase
commitments		407		-		(1)		-		-		-		-		-		-		-		-		406		(1)
Currency
derivatives, net		9		-		3		-		1		-		-		-		-		-		-		13		4
Other		-		-		-		-		-		17		-		-		-		-		-		17		-
Total assets	$	2,122	$	-	$	8	$	-	$	1	$	17	$	-	$	(64)	$	(3)	$	-	$	(7)	$	2,074	$	9

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended September 30, 2016
																									Change in
																									Unrealized
																									Gains
																									(Losses) for
																									the Period
																									Included in
					Unrealized																				Earnings for
					Gains /		Unrealized		Foreign																Assets
					(Losses)		Gains /		Exchange																still held
	Balance,		Realized		Included		(Losses)		Recognized										Transfers		Transfers				as of
	Beginning		Gains /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Period		(Losses)		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2016
Assets:
Foreign governments	$	7	$	-	$	-	$	-	$	-	$	5	$	-	$	(6)	$	-	$	-	$	-	$	6	$	-
Corporate obligations		2		-		-		-		-		-		-		(1)		-		-		-		1		-
Commercial
mortgage-backed		-		-		-		-		-		-		-		-		-		1		-		1		-
Collateralized debt
obligations		20		-		-		-		-		-		-		(3)		-		-		-		17		-
Other asset-backed		41		-		-		-		-		-		-		-		-		-		(3)		38		-
State and municipal
bonds		124		-		-		-		-		-		-		-		-		2		(122)		4		-
Assets of
consolidated VIEs:
Corporate obligations		3		-		-		-		-		-		-		-		-		-		-		3		-
Residential mortgage-
backed non-agency		1		-		(1)		-		-		-		-		-		-		-		-		-		-
Commercial
mortgage-backed		2		-		(1)		-		-		-		-		-		-		2		-		3		(1)
Collateralized debt
obligations		1		-		-		-		-		-		-		-		-		-		-		1		-
Other asset-backed		4		-		-		-		-		-		-		-		-		-		(3)		1		-
Loans receivable-
residential		1,045		-		25		-		-		-		-		(75)		-		-		-		995		25
Loans receivable-
corporate		147		-		-		-		-		-		-		-		-		-		-		147		-
Loan repurchase commitments		401		-		3		-		-		-		-		-		-		-		-		404		3
Currency derivatives, net		9		-		-		-		4		-		-		-		-		-		-		13		4
Total assets	$	1,807	$	-	$	26	$	-	$	4	$	5	$	-	$	(85)	$	-	$	5	$	(128)	$	1,634	$	31

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Nine Months Ended September 30, 2017
																									Change in
																									Unrealized
																									Gains
																									(Losses) for
																									the Period
																									Included in
					Unrealized																				Earnings for
					Gains /		Unrealized		Foreign																Assets
					(Losses)		Gains /		Exchange																still held
	Balance,		Realized		Included		(Losses)		Recognized										Transfers		Transfers				as of
	Beginning		Gains /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Year		(Losses)		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2017
Assets:
Corporate obligations		2		-		-		-		-		-		-		-		-		-		(2)		-		-
Commercial
mortgage-backed		-		-		-		-		-		-		-		-		-		7		(7)		-		-
Collateralized debt
obligations		15		-		-		-		-		-		-		(7)		-		-		(8)		-		-
Other asset-backed		44		-		-		2		-		-		-		(41)		-		-		-		5		-
State and municipal
bonds		-		-		-		-		-		-		-		-		-		1		(1)		-		-
Assets of
consolidated VIEs:
Corporate obligations		-		-		-		-		-		-		-		(2)		-		6		(4)		-		-
Commercial
mortgage-backed		-		-		-		-		-		-		-		-		(3)		3		-		-		-
Collateralized debt
obligations		1		-		-		-		-		-		-		-		-		-		-		1		-
Other asset-backed		1		-		-		-		-		-		-		-		-		1		(2)		-		-
Loans receivable-
residential		916		-		29		-		-		-		-		(186)		-		-		-		759		29
Loans receivable-
corporate		150		-		36		-		-		719		-		(32)		-		-		-		873		36
Loan repurchase
commitments		404		-		2		-		-		-		-		-		-		-		-		406		2
Currency
derivatives, net		19		-		(2)		-		(4)		-		-		-		-		-		-		13		(6)
Other		-		-		-		-		-		17		-		-		-		-		-		17		-
Total assets	$	1,552	$	-	$	65	$	2	$	(4)	$	736	$	-	$	(268)	$	(3)	$	18	$	(24)	$	2,074	$	61

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Nine Months Ended September 30, 2016
																									Change in
																									Unrealized
																									Gains
																									(Losses) for
																									the Period
																									Included in
					Unrealized																				Earnings for
					Gains /		Unrealized		Foreign																Assets
					(Losses)		Gains /		Exchange																still held
	Balance,		Realized		Included		(Losses)		Recognized										Transfers		Transfers				as of
	Beginning		Gains /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Year		(Losses)		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2016
Assets:
Foreign governments	$	2	$	-	$	-	$	-	$	(1)	$	10	$	-	$	(5)	$	-	$	-	$	-	$	6	$	-
Corporate obligations		7		-		-		-		-		-		-		-		-		-		(6)		1		-
Commercial
mortgage-backed		-		-		-		-		-		-		-		-		-		1		-		1		-
Collateralized debt
obligations		29		-		-		18		-		-		-		(30)		-		-		-		17		-
Other asset-backed		38		(1)		(1)		8		-		-		-		(3)		-		-		(3)		38		(1)
State and municipal
bonds		41		-		-		-		-		122		-		(39)		-		2		(122)		4		-
Assets of
consolidated VIEs:
Corporate obligations		11		-		(4)		-		-		-		-		(1)		-		2		(5)		3		-
Residential mortgage-
backed non-agency		-		-		(1)		-		-		-		-		-		-		1		-		-		-
Commercial
mortgage-backed		-		-		(1)		-		-		-		-		-		-		4		-		3		(1)
Collateralized debt
obligations		1		-		-		-		-		-		-		-		-		-		-		1		-
Other asset-backed		6		-		(6)		-		-		-		-		-		-		4		(3)		1		-
Loans receivable-
residential		1,185		-		(5)		-		-		-		-		(185)		-		-		-		995		(5)
Loans receivable-
corporate		107		-		1		-		-		146		-		-		(107)		-		-		147		1
Loan repurchase
commitments		396		-		8		-		-		-		-		-		-		-		-		404		8
Currency derivatives, net		11		-		(2)		-		4		-		-		-		-		-		-		13		2
Total assets	$	1,834	$	(1)	$	(11)	$	26	$	3	$	278	$	-	$	(263)	$	(107)	$	14	$	(139)	$	1,634	$	4

Changes In Level 3 Liabilities Measured At Fair Value On A Recurring Basis

																									Change in
																									Unrealized
																									(Gains)
																									Losses for
																									the Period
																									Included in
					Unrealized																				Earnings for
					(Gains) /		Unrealized		Foreign																Liabilities
					Losses		(Gains) /		Exchange																still held
	Balance,		Realized		Included		Losses		Recognized										Transfers		Transfers				as of
	Beginning		(Gains) /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Period		Losses		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2017
Liabilities:
Medium-term notes	$	123	$	-	$	(1)	$	-	$	5	$	-	$	-	$	-	$	-	$	-	$	-	$	127	$	4
Credit derivatives, net		80		7		(6)		-		-		-		-		(7)		-		-		-		74		(6)
Other derivatives		4		-		-		-		-		-		-		-		-		-		-		4		-
Other payable		-		-		1		-		-		6		-		-		-		-		-		7		1
Liabilities of
consolidated VIEs:
VIE notes		491		-		4		-		-		-		-		(14)		(51)		-		-		430		4
Total liabilities	$	698	$	7	$	(2)	$	-	$	5	$	6	$	-	$	(21)	$	(51)	$	-	$	-	$	642	$	3
_______________
(1) - Transferred in and out at the end of the period.

																									Change in
																									Unrealized
																									(Gains)
																									Losses for
																									the Period
																									Included in
					Unrealized																				Earnings for
					(Gains) /		Unrealized		Foreign																Liabilities
					Losses		(Gains) /		Exchange																still held
	Balance,		Realized		Included		Losses		Recognized										Transfers		Transfers				as of
	Beginning		(Gains) /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Period		Losses		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2016
Liabilities:
Medium-term notes	$	161	$	-	$	-	$	-	$	2	$	-	$	-	$	(57)	$	-	$	-	$	-	$	106	$	2
Credit derivatives, net		104		5		(19)		-		-		-		-		(5)		-		-		-		85		12
Other derivatives, net		21		-		(2)		-		-		-		-		-		-		-		-		19		(2)
Liabilities of
consolidated VIEs:
VIE notes		523		-		2		-		-		-		-		(27)		-		-		-		498		2
Total liabilities	$	809	$	5	$	(19)	$	-	$	2	$	-	$	-	$	(89)	$	-	$	-	$	-	$	708	$	14
_______________
(1) - Transferred in and out at the end of the period.

																									Change in
																									Unrealized
																									(Gains)
																									Losses for
																									the Period
																									Included in
					Unrealized																				Earnings for
					(Gains) /		Unrealized		Foreign																Liabilities
					Losses		(Gains) /		Exchange																still held
	Balance,		Realized		Included		Losses		Recognized										Transfers		Transfers				as of
	Beginning		(Gains) /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Year		Losses		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2017
Liabilities:
Medium-term notes	$	101	$	-	$	13	$	-	$	13	$	-	$	-	$	-	$	-	$	-	$	-	$	127	$	26
Credit derivatives, net		64		41		10		-		-		-		-		(41)		-		-		-		74		12
Other derivatives, net		20		-		18		-		-		-		-		(34)		-		-		-		4		18
Other payable		-		-		1		-		-		6		-		-		-		-		-		7		1
Liabilities of
consolidated VIEs:
VIE notes		476		-		56		-		-		-		-		(51)		(51)		-		-		430		56
Total liabilities	$	661	$	41	$	98	$	-	$	13	$	6	$	-	$	(126)	$	(51)	$	-	$	-	$	642	$	113
_______________
(1) - Transferred in and out at the end of the period.

																									Change in
																									Unrealized
																									(Gains)
																									Losses for
																									the Period
																									Included in
					Unrealized																				Earnings for
					(Gains) /		Unrealized		Foreign																Liabilities
					Losses		(Gains) /		Exchange																still held
	Balance,		Realized		Included		Losses		Recognized										Transfers		Transfers				as of
	Beginning		(Gains) /		in		Included		in OCI or										into		out of		Ending		September 30,
In millions	of Year		Losses		Earnings		in OCI		Earnings		Purchases		Issuances		Settlements		Sales		Level 3⁽¹⁾		Level 3⁽¹⁾		Balance		2016
Liabilities:
Medium-term notes	$	161	$	-	$	(4)	$	-	$	6	$	-	$	-	$	(57)	$	-	$	-	$	-	$	106	$	2
Credit derivatives, net		85		21		-		-		-		-		-		(21)		-		-		-		85		9
Other derivatives, net		18		-		1		-		-		-		-		-		-		-		-		19		(1)
Liabilities of
consolidated VIEs:
VIE notes		1,267		-		(41)		-		-		9		-		(106)		(631)		-		-		498		(41)
Total liabilities	$	1,531	$	21	$	(44)	$	-	$	6	$	9	$	-	$	(184)	$	(631)	$	-	$	-	$	708	$	(31)
_______________
(1) - Transferred in and out at the end of the period.

Gains And Losses (Realized And Unrealized) Included In Earnings Pertaining To Level 3 Assets And Liabilities


		Three Months Ended September 30, 2017				Three Months Ended September 30, 2016
				Change in				Change in
				Unrealized				Unrealized
				Gains (Losses)				Gains (Losses)
				for the				for the
				Period Included				Period Included
				in Earnings				in Earnings
				for Assets				for Assets
				and				and
		Total Gains		Liabilities still		Total Gains		Liabilities still
		(Losses)		held as of		(Losses)		held as of
		Included		September 30,		Included		September 30,
In millions		in Earnings		2017		in Earnings		2016
Revenues:
	Unrealized gains (losses) on
	insured derivatives	$	6	$	6	$	19	$	(12)
	Realized gains (losses) and other
	settlements on insured derivatives		(7)		-		(5)		-
	Net gains (losses) on financial instruments
	at fair value and foreign exchange		(4)		(4)		-		-
	Other net realized gains (losses)		(1)		(1)		-		-
	Revenues of consolidated VIEs:
	Net gains (losses) on financial instruments
	at fair value and foreign exchange		5		5		28		29
Total		$	(1)	$	6	$	42	$	17


		Nine Months Ended September 30, 2017				Nine Months Ended September 30, 2016
				Change in				Change in
				Unrealized				Unrealized
				Gains (Losses)				Gains (Losses)
				for the				for the
				Period Included				Period Included
				in Earnings				in Earnings
				for Assets				for Assets
				and				and
		Total Gains		Liabilities still		Total Gains		Liabilities still
		(Losses)		held as of		(Losses)		held as of
		Included		September 30,		Included		September 30,
In millions		in Earnings		2017		in Earnings		2016
Revenues:
	Unrealized gains (losses) on
	insured derivatives	$	(10)	$	(12)	$	-	$	(9)
	Realized gains (losses) and other
	settlements on insured derivatives		(41)		-		(21)		-
	Net gains (losses) on financial instruments
	at fair value and foreign exchange		(44)		(44)		(5)		(2)
	Net investment losses related to
	other-than-temporary impairments		-		-		(1)		-
	Other net realized gains (losses)		(1)		(1)		-		-
	Revenues of consolidated VIEs:
	Net gains (losses) on financial instruments
	at fair value and foreign exchange		5		5		35		46
Total		$	(91)	$	(52)	$	8	$	35

Changes In Fair Value Included In The Company's Consolidated Statements Of Operations

		Three Months Ended September 30,				Nine Months Ended September 30,
In millions		2017		2016		2017		2016
Investments carried at fair value⁽¹⁾		$	2	$	2	$	8	$	8
Fixed-maturity securities held at fair value-VIE⁽²⁾			(2)		(12)		(16)		(109)
Loans receivable at fair value:
	Residential mortgage loans⁽²⁾		(55)		(50)		(157)		(190)
	Corporate loans⁽²⁾		(2)		-		4		-
Loan repurchase commitments⁽²⁾			(1)		3		3		8
Medium-term notes⁽¹⁾			(4)		(2)		(26)		(2)
Variable interest entity notes ⁽²⁾			70		70		160		307
Other liabilities⁽³⁾			(1)		-		(1)		-
___________
(1) - Reported within "Net gains (losses) on financial instruments at fair value and foreign exchange" on MBIA's consolidated statements of operations.
(2) - Reported within "Net gains (losses) on financial instruments at fair value and foreign exchange-VIE" on MBIA's consolidated statements of operations.
(3) - Reported within "Other net realized gains (losses)" on MBIA's consolidated statements of operations.

Difference Between Aggregate Fair Value And The Aggregate Remaining Contractual Principal Balance Outstanding

		As of September 30, 2017							As of December 31, 2016
		Contractual						Contractual
		Outstanding		Fair				Outstanding		Fair
In millions		Principal		Value		Difference		Principal		Value		Difference
Loans receivable at fair value:
	Residential mortgage loans	$	766	$	721	$	44	$	965	$	894	$	71
	Residential mortgage loans (90 days or more past due)		157		38		119		143		22		121
	Corporate loans (90 days or more past due)		873		873		-		150		150		-
Total loans receivable at fair value			1,796		1,632		163		1,258		1,066		192

Variable interest entity notes			1,941		1,140		801		2,449		1,351		1,098

Medium-term notes			177		127		51		158		101		57

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

- Definition

Tabular disclosure of the application of the fair value option for measurement and reporting of eligible financial assets and liabilities (as defined), as well as certain other eligible items (as defined) included in the statement of financial position, whether such option is elected for a single eligible item or a group of similar eligible items and is in addition to other disclosures concerning fair value which the company may be required to provide. Such disclosure might be expected to include: (1) for items included in the statement of financial position: (a) for each line item in the statement of financial position that includes an item or items for which the fair value option has been elected, provide the aggregate carrying amount of ineligible items included in each line item in the balance sheet, if any; (b) the difference between the aggregate fair value and the aggregate unpaid principal balance (assuming contractual principal amounts and fair value option elected) of: (i) loans and long-term receivables (other than securities otherwise reported at fair value) and (ii) long-term debt instruments; (c) for loans held as assets for which the fair value option has been elected: (i) the aggregate fair value of loans that are 90 days or more past due, (ii) if the policy is to recognize interest income separately from other changes in fair value, the aggregate fair value of loans in nonaccrual status, and (iii) the difference between the aggregate fair value and the aggregate unpaid principal balance for loans that are 90 days or more past due, in nonaccrual status, or both; (2) for items included in the income statement: (a) the amounts of gains and losses from fair value changes included in earnings and in which line in the income statement those gains and losses are reported whether or not combined with gains and losses from items required to be accounted for at fair value; (b) for loans and other receivables held as assets, the estimated amount of gains or losses included in earnings attributable to changes in instrument-specific credit risk; (c) for liabilities with fair values that have been significantly affected during the reporting period by changes in the instrument-specific credit risk, the estimated amount of gains and losses from fair value changes included in earnings that are attributable to changes in the instrument-specific credit risk; and (3) certain other disclosures as required or determined to be provided.

+ References + Details