Morgan Stanley Settles Dispute With MBIA, Terminating Swaps
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Morgan Stanley reached a settlement with MBIA Inc. over credit-default swaps that led to billions of dollars of losses for the bank, agreeing to terminate the contracts and drop a challenge to the insurer’s restructuring.
MBIA will make a $1.1 billion cash payment to Morgan Stanley as part of the settlement, according to a person familiar with the agreement who asked not to be named because the amount hasn’t been made public. Morgan Stanley will take a $1.2 billion loss this quarter related to the deal, the New York-based bank said today in a statement.