The US investment banking giant Morgan Stanley took a $1.8bn (£1.15bn) hit yesterday as it settled a long-running legal battle over toxic sub-prime debt.
The bank's two-year dispute with bond insurer MBIA centres on mortgage-backed bonds which Morgan Stanley insured with MBIA in 2008.
MBIA ran into trouble during the financial crisis, sparking fears at Morgan Stanley it would go bust without stumping up insurance payouts on the bonds. The investment bank tried to hedge this risk by buying credit default swaps on MBIA, in effect betting against the company. But a recovery in MBIA's fortunes since the financial crisis left Morgan Stanley nursing more than $3bn in losses since 2007 on its exposure to MBIA and other bond insurers since 2007.
Morgan Stanley joined a consortium of 17 banks suing MBIA after a restructuring of the insurer which they claimed would have an impact on its ability to pay out on insurance contracts, but MBIA promptly counter-sued the banks for not doing proper due diligence.
Today's settlement sees MBIA pay $1.1bn to Morgan Stanley, which is writing down the value of its $2.9bn mortgage-backed bonds to nothing and cancelling the CDS contracts. Although the firm will take a $1.8bn blow to profits, removing the riskier assets from its balance sheets frees $5bn in capital.
Its chief executive James Gorman, above, said: "This settlement is consistent with our efforts to build capital and de-risk the balance sheet."
Practice Islam from live quran and spread the word of truth
Benefits for the students when they learn holy Quran through the Quranic Students the kids get wiser when the student start Quran reading from there childhood and gain the Our beloved Prophet Muhammad (saww) said: Who ever read Quran before becoming a Baaligh has indeed been given wisdom as a child. The quran teaching is one of the best intellectual treasures that a student can have. And we should guide our kids to learn quran Our Prophet Muhammad (saww) said: The holy Quran is a wealth with which there is no poverty, and without which there is no wealth. So quran tutor should let the student do quran memorization and pay attention to the main lesson of the quran wile reading quran or become a Quran reciter with its depth knowledge to shine in the whole world now a day many online institutes who teach kids quran online and give them tajweed quran lessons to improve the kids quran recitation online and let then learn quran online with proper manner and following and learn quranic Arabic with the translation and then learn quran tafseer also so the student can feel the main them and get the true guidance
End of the note by quran education
No comments:
Post a Comment