MBIA Shares Slide Day After S&P Cuts Unit To Junk

CHARLOTTE, N.C. (AP) — Shares of MBIA Inc. fell Tuesday, a day after Standard & Poor's Ratings Services cut the bond insurer's ratings to junk status.

Shares of MBIA lost 33 cents, or 4 percent, to $7.89 in afternoon trading. They have traded between $2.17 and $13.75 during the past year.

Late Monday, S&P lowered its ratings on MBIA and its finance insurance arm, MBIA Insurance Corp., citing concern that the business could continue to suffer losses from insuring risky loans.

S&P cut the counterparty credit, financial strength and financial enhancement ratings on MBIA Insurance to "BB+" from "BBB." The counterparty credit rating on MBIA, the group holding company, was lowered to "BB-" from "BB." All the double-B ratings are non-investment grade, or junk. The outlook on MBIA insurance and the holding company is "negative."

"Macroeconomic conditions continue to contribute to losses on the group's structured finance products," S&P said in a statement. "The negative outlook on MBIA and the holding company reflects our view that adverse loss development on the structured finance book could continue."