Welcome to the MBIA Inc. Third Quarter 2024 Financial Results Conference Call. I would now like to turn the call over to Greg Diamond, Managing Director of Investor and Media Relations at MBIA. Please go ahead, sir. Thank you, Ashley. Welcome to MBIA's conference call for our Third Quarter 2024 financial results. After the market closed yesterday, we issued and posted several items on our website, including our financial results, 10-Q, quarterly operating supplement, 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 companies' insured portfolios. Regarding today's call, please note that anything said on the call is qualified by the information provided in the company's 10-K, 10-Qs, 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-Qs, and they contain our most current disclosures about the company and its financial and operating results. Those documents also contain information that may not be addressed on today's call. Definitions and reconciliations of the non-GAAP terms included in our remarks today are also included in our 10-K and 10-Qs, as well as our financial results report and our quarterly operating supplement. The recorded replay of today's call will become available on the MBIA website approximately two hours after the end of the call. Now, here is our Safe Harbor Disclosure Statement. Our remarks on today's conference call may contain forward-looking statements. Important factors such as general market conditions and the 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-Qs, which are available on our website at mbia.com. The Company cautions not to place undue reliance on any such forward-looking statements. 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 Joe Schachinger will provide introductory comments, and then a question-and-answer session will follow. Now, here is Bill Fallon. Thanks, Greg. Good morning, everyone. Thanks for being with us today. For our Third Quarter 2024 financial results, our revenues and expenses both improved compared with last year's Third Quarter, which yielded a lower net loss than last year's Third Quarter. Revenues were higher largely due to lower losses related to variable interest entities associated with MBIA Insurance Corp, and expenses were lower largely due to lower loss and loss adjustment expense associated with National's PREPA exposure. Regarding PREPA, mediation has been extended through January 31st of next year. In the meanwhile, the parties in mediation are waiting for the decision from the First Circuit Court of Appeals as to whether they will rehear arguments regarding their ruling earlier this year that determined PREPA bondholders' rights included a lien on PREPA's net revenues. Given the uncertainty associated with the possible outcomes for National's PREPA bankruptcy claim in excess of $800 million, we expect that substantially reduced uncertainty regarding the PREPA outcome will likely be needed before we can restart the process to sell the company. Regarding the balance of National's insured portfolio, those credits have continued to perform generally consistent with our expectations. The gross par amount outstanding for National's insured portfolio has declined by approximately $2.5 billion from year-end 2023 to about $26 billion at the end of the Third Quarter of this year. National's leverage ratio of gross par to statutory capital was 26 to 1 at the end of the Third Quarter of 2024. As of September 30th, 2024, National had total claims-paying resources of $1.6 billion and statutory capital and surplus of $1 billion. Now, Joe will provide additional comments about our financial results. Thank you, Bill, and good morning, all. I will begin with a review of our Third Quarter 2024 GAAP and non-GAAP results and then provide an overview of our statutory results. The company reported a consolidated GAAP net loss of $56 million, or a negative $1.18 per share for the Third Quarter of 2024, compared to a consolidated GAAP net loss of $185 million, or a negative $3.94 per share for the Third Quarter of 2023. The lower GAAP net loss of this quarter was largely driven by two items. First is lower Loss and LAE at National. In the Third Quarter of 2023, higher Loss and LAE was primarily the result of updating our range of recoveries for PREPA under the then-amended PSA. In the current quarter, Loss and LAE was primarily driven by accretion of our reserves and recoveries. And the second item is lower losses related to consolidated VIEs at MBIA Insurance Corp. In the Third Quarter of 2023, VIE losses primarily related to the early redemption of VIE liabilities insured by MBIA Insurance Corp and the deconsolidation of a VIE with no comparable activity in the current quarter. The company's adjusted net loss, a non-GAAP measure, was $174,000, or essentially $0.00 per share for the Third Quarter of 2024, compared with an adjusted net loss of $138 million, or negative $2.92 per share for the Third Quarter of 2023. Favorable change was primarily due to the lower loss and LAE at National in the current quarter related to PREPA. During the first nine months of this year, MBIA Inc.'s book value per share decreased $6.63 to a negative $39.19 per share as of September 30th, 2024, versus a negative $32.56 per share as of December 31st, 2023. This decrease was primarily due to our $396 million consolidated net loss for the 2024 year-to-date period. Included in MBIA Inc.'s book value as of September 30th, 2024, is a negative $48.80 per share of MBIA Insurance Corporation's book value versus a negative $44.91 per share as of December 31st, 2023. I will now spend a few minutes on our corporate segment balance sheet. The corporate segment, which primarily comprises the activities of the holding company, MBIA Inc., had total assets of approximately $646 million as of September 30th, 2024. Within this total are the following material assets: unencumbered cash and liquid assets held by MBIA Inc. totaled $326 million, compared with $411 million as of December 31, 2023. The decrease was largely due to spending approximately $78 million in the first and second quarters of 2024 on retiring GFL Euro-denominated medium-term note liabilities and purchasing MBIA Inc. Senior notes before their maturities. As noted in prior quarters, both the medium-term notes and senior notes were purchased at prices accretive to equity. In addition to the unencumbered cash and liquid assets, the corporate segment's assets included approximately $211 million of assets at market value pledged to guaranteed investment agreement contract holders, which fully collateralized those contracts. Now, turning to the insurance company's statutory results. National reported statutory net income of $19 million for the Third Quarter of 2024 compared to a statutory net loss of $133 million for the Third Quarter of 2023. The favorable variance was primarily driven by the lower loss and LAE related to its PREPA exposure. National's statutory capital as of September 30th, 2024, was $1 billion, down $117 million compared with December 31st, 2023, largely due to its statutory net loss for the 2024 year-to-date period of $123 million. Claims-paying resources were $1.6 billion, down $95 million from December 31st, 2023. As of September 30th, 2024, National had gross par outstanding of $26 billion, which is down about $2.5 billion from year-end 2023. This decrease was largely due to regular amortization of National's insured portfolio. Now, I'll turn to MBIA Insurance Corporation. MBIA Insurance Corporation reported statutory net income of $2 million for the third quarter of 2024 compared to a statutory net loss of $14 million for the third quarter of 2023. A small loss and LAE benefit this quarter helped drive net income. An increase in loss reserves on RMBS and ABS/CDO exposures primarily drove the net loss in the third quarter of 2023. As of September 30th, 2024, the statutory capital of MBIA Insurance Corp was $87 million, down from $152 million at year-end 2023, primarily due to its net loss for the 2024 year-to-date period of $68 million. Claims-paying resources totaled $358 million at September 30th, 2024, compared to $504 million at year-end 2023. MBIA Insurance Corp's insured gross par outstanding was $2.5 billion as of September 30th, 2024, down about 13% from year-end 2023. The decrease in claims-paying resources and gross par outstanding was partially driven by our proactive de-risking of exposures for which we held reserves and were paying claims. And now, we will turn the call over to the operator to begin the question-and-answer session. Certainly. If you have a question at this time, please press Star 1 on your telephone keypad. If you wish to remove yourself from the queue, press Star 2. We ask that when posing your question, you please pick up your handset to avoid suboptimal sound quality. We will pause a moment to allow any questions to queue. We will take our first question from Tommy McJoynt with KBW. Please go ahead. Hey, good morning, guys. Thanks for taking my questions. So with $1 billion of capital at National, how much of that do you consider excess? And are you seeking approval to release any of that capital? It was around this time last year that National got approval for the substantial capital release. Yeah, Tommy, thank you for the question. Given that we don't focus on ratings anymore, we don't necessarily do a calculation in terms of what the excess capital is the way perhaps other companies do. But what we do focus on, as you referred to, is trying to get extraordinary dividends when it's appropriate, which we did last year at this time. Now, we do have the annual as-of-right dividend that will be paid before the end of the year. But I think at this point, given the extraordinary dividend last year, we want to make sure that there's further progress on Puerto Rico before we engage in any discussions with the department. Okay. Got it. And if I look at the disclosures, so National paid a gross claim on July 1st of 2024 of $122 million on PREPA. And it looks like the National's insurance loss recoverable increased by $57 million. So that looks like that equates to you guys assuming a 47% recovery on that claim paid. Is that the right math to think about, or are there any other inputs I need to consider? Yeah. While we don't comment exactly on what the number is, the approach that you're taking is very logical and reasonable. Got it. Thank you. Thank you. We will take our next question from Jordan Hymowitz with Philadelphia Financial. Please go ahead. Hey, guys. Can you hear me okay? We can hear you fine, Jordan. Great. Thank you. You commented that you're not looking to re-engage the process of selling the company, which you've tried a couple of times until Puerto Rico has greater clarity. I guess my question is why? I mean, there's different ranges of Puerto Rican outcomes that can be evaluated in different payback and payments depending on resolutions. I mean, there's obviously, as competitor A continues to go up in price, there's more value to their stock. You're losing value there. Why not engage now with some sort of structure that if the resolution is more favorable, there's a greater back-end payment? I mean, it just seems like you've got a very valuable franchise. The market values the competitors, either private or the one that's public has the capital. Why not engage now? The approach you described is one that we have considered and is a real possibility. The reality is the feedback that we've received to date would suggest that it would not be beneficial for our shareholders. But that doesn't mean that things don't change at any point in time. So it is always a possibility in terms of the approach you described. Okay. I mean, it's tough to know once you get into the negotiating room as it was, but it does seem because it's most likely to be a stock deal, the ratios are unbelievably powerful, and you should have some leverage with what the outcome is. And as a shareholder now for most of the past three or four years, it just seems like a great opportunity to see if there's an interest in exploring that because we're getting closer. And with the governor of Puerto Rico being elected, who wants to resolve a lot of things, it's more likely that something could come to fruition, and then it'd be a win-win for everybody. Yeah. Jordan, we agree. We think the sooner this can all be resolved, it will be better for our shareholders, and so that's what we're focused on as well. Okay. Thanks for at least considering it, and thank you for taking my questions. Thank you. Thank you. We will take our next question from John Staley with Staley Capital Advisers. Please go ahead. Thank you. Bill, sort of a follow-up on the last comment that was made with the election of Trump. Given the fiasco of Madison Square Garden with the rogue comedian and the presence not widely appreciated by the general public, but certainly by politicians, but given the presence within the Puerto Rican government of significant Republican positions, I forget who's the president or somebody very high up, but there's more than one major Republican involved in the Puerto Rican administration, and it seems to me that Trump, given what happened in Madison Square Garden, would like to get this situation resolved a hell of a lot more than Kamala Harris would have ever cared about. But I'm curious if you see a path to where Trump might just dismiss the oversight board and let you get this resolved with the Puerto Rican government and the adversary parties in this to get the Puerto Rican people in a position where they can get back to financing things and getting things done. I think this is a great message that might be heard favorably by Trump as a very positive move for the Puerto Rican people. I'm curious one of your reactions to whether you see that avenue or not. Yeah. John, again, thank you for your call and your interest. Given the events of this week with the election and everything you just described, we have been looking for a catalyst to help resolve this now for, as you know, many years. So if, in fact, Trump's approach to this would be one that would move us towards that end, we would be very much supportive of that approach. So I think it's going to take a little bit of time. Obviously, he was just elected this week. Same thing with the new governor of Puerto Rico. We have heard some early comments very much along the lines that you've been describing. My guess is over the next few weeks and into January when he actually takes office, we may get a better sense of whether this really is a catalyst to resolving this much quicker than perhaps the current path that we're on, which, again, we think would be very much appreciated and would be good for our shareholders. That governor you're talking about, isn't she a Republican? The answer is yes. It's slightly different, but the short answer is yes. Thank you. Thank you very much. I think it's a very positive development in terms of getting this resolved. I mean, keeping this with the oversight board, judges, and lawyers is just nuts. It has been a very long process. We agree with you. Amen. All right. Thank you. Thank you. And as a reminder, that is Star 1 for your questions. We will take our next question from Carlos Pardo with Private Investor. Please go ahead. Hi. Good afternoon from London. Thanks again for the December dividend and also for the time last summer going through different options. I have a couple of questions regarding our PREPA Co-op with GoldenTree and Syncora and Assured. My understanding is that the Co-op was extended in August until March 2025. Is that correct? Is that the maturity at the moment? I'm sorry, Carlos. Could you repeat the question? We couldn't quite hear you here. Yes. The Co-op, yes, the Co-op with GoldenTree and Syncora and Assured, what is extended in August until March 2025? Is this at the moment when it expires? What is something about GoldenTree and expiration? The Co-op, yes. They're still into a Co-op, a cooperation agreement with GoldenTree and Syncora and Assured. And my understanding is it was extended in August until March 2025. Is this the situation at the moment? Yes. We are part of a cooperation. Yes, Carlos, we are part of a cooperation agreement with the other bondholders that was extended into next year. That's correct. That's correct. Until March. Correct. Perfect. And could we walk away from that Co-op before March 2025 if someone offers better terms? Or are we tied to that Co-op? The question is, are we tied? Could we walk away? Do we have the ability to? Yes. Could we walk away, or are we obliged to stay in the Co-op? At this point, we've agreed to work together with the other bondholders who are part of that agreement. As with all these agreements, I suppose you could come up with a scenario where something were to change that. But that is the approach that we're taking. We are in agreement with them or working with them. We cannot sell our exposure until March then, I assume. We have to stick to the PREPA exposure until March? Can we sell it to third parties? We always have the right to sell our exposure. We sold a portion of our PREPA exposure years ago. Yeah. I remember. Yeah. So there is nothing preventing us from finding a buyer for the exposure. I believe that's correct. Yes. Okay. Perfect. And since our exposure is very strategically important to meet certain bondholders' thresholds, so basically the Co-op only surpasses the 60% mark if we are in, what are we getting in exchange from the co-op group in return for our support? What are we getting from the Co-op group in exchange for our support? Yeah. Are we just joining for free, or do we get any kind of advantage or? The benefit is we have the benefit of large numbers in terms of the dollar amount or the portion of the debt that is held by that group. Yes. I mean, just think that our percentage is very strategically important because of the percentages of the Co-op group and of the other group. I think that we play a key role there. And then the last question is, has it worked for any other co-op members' expressed interest in buying our exposure or buying ourselves? Because at the moment, we have a $200 million market cap, and it would be relatively easy for them to buy the whole company and litigate. I'm sorry. Could you repeat the question, Carlos? I didn't finish. Yeah. Yeah. Has this expressed any interest in buying our exposure? No. There's been very little trading of the bonds, and the interest in buying claims has diminished significantly over the last few years. Yeah. Well, I mean, my suggestion of course, I discussed this with Greg back in July, but my suggestion is that we should not extend this cooperation beyond March unless we get something in return because I think that our position is very strategic in terms of the balance of power between the current Co-op with Syncora, GoldenTree, and Assured, and the group that is led by BlackRock. So definitely, I think that if this goes beyond March, I would take a different approach. That's my view on this. Okay. We appreciate that. We will take that into consideration. Perfect. Thank you. Thank you. Thank you. We will take our next question from. We do have a follow-up from Jordan Hymowitz with Philadelphia Financial. Please go ahead. Hi. Follow-up to the gentleman's question right after mine, which I thought was excellent, about the new governor, González-Colón. I mean, she put out a statement, and I quote, "I will begin looking for a second operator for LUMA so that we can resolve the issues with the electrical system." Does a second operator for LUMA and the electric system necessitate a resolution of PREPA? And does that mean she might involve herself more in doing this so we can get cheaper power to the islands? With regard to the first, it doesn't mean that PREPA has to be restructured or that that issue has to be resolved for them to deal with operating issues, which is what LUMA effectively is. Your guess is as good as ours whether or not that statement indicates that she wants to get more involved in PREPA, not only in the operations of it, but also in the restructuring issues. Let me phrase the question a different way, and I could be a little off here, and I apologize if I am, but does the lack of resolution of PREPA in any way impede the construction or improvement of the new electrical power plants in Puerto Rico? Or is it just a financial issue? We would suggest that they are tied together. There are certain things that can be done. Obviously, they need to operate PREPA in the absence of a resolution, but I think it's a reasonable conclusion that resolving the restructuring or effectively the bankruptcy would help facilitate the operational aspects of PREPA. Not to mention save a tremendous amount of money that's only being paid to lawyers and mediators instead of the working-class Puerto Ricans who could benefit from lower energy costs. But that's a different political comment. I think everyone would agree with your statement, however. Thank you. I appreciate you taking my question. I would love to have a follow-up call. Okay. Thank you. Thank you. And at this time, I'm showing no further questions. I'd like to turn the floor over to management for any additional or closing remarks. Thank you, Ashley. And thanks to everyone listening to the call today. Please contact us directly if you have additional questions. We also recommend that you visit our website at mbia.com for additional information about our company. Thank you for your interest in MBIA. Good day and goodbye. Thank you. This does conclude today's program. Thank you for your participation. You may disconnect at any time.