Buffett Watch

MBIA's CEO Tells CNBC He's "Comfortable" Competing with Warren Buffett

In a live on-set interview during today's Closing Bell on CNBC, MBIA CEO Jay Brown told us he's "comfortable" going up against Warren Buffett's new bond insurance company, although he acknowledges that Berkshire Hathaway can be "tough" competition.

In response to a question from Michele Caruso-Cabrera about Buffett "going after" his business, Brown suggested Buffett might not be in it for the long haul:

"I have competed with Warren Buffett in the insurance space most of my life.  They're tough competitors.  They offer a unique product.  And they also like to come in and out of markets.  The muni market, or the structured market, when you look at it, needs constant players in there.   We've seen a huge drop in bond coverage provided by the market.

Warren saw an opportunity.  Warren never misses an opportunity to jump in, especially when there's stress.  And so I think I'm pretty comfortable we can compete with Warren."

It's an interesting interview, with Brown talking in detail about his plans and goals for the troubled bond insurer, which today held onto its AAA rating from Moody's, at least for now.  He revealed that MBIA is done raising "significant dilutive capital."  

You can watch the entire conversation in this video clip.

Today, Standard and Poor's said it will give its top AAA credit ratingto bonds backed by Berkshire Hathaway Assurance Corp., even though the new insurer does not yet have its own credit rating.  S&P says that's justified by "significant contractural commitments" from another Berkshire subsidiary that does have a triple-A.  Moody's announced a similar decision late last week.

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