Case Study

MBIA / Spiegel

CLIENT: MBIA as insurer of a securitization of Spiegel credit card receivables

Gordian Group acted as financial advisor to MBIA with regard to Spiegel’s bankruptcy, and the related securitizations.

Business Profiles

Situation

Spiegel entered Chapter 11 in 2003 due to, among other factors, uncertainty concerning the release of timely financial information. Spiegel had securitized its private label credit card receivables which resulted from credit card purchases at its Eddie Bauer stores and its Spiegel and Newport News catalogs. The securitizations aggregated approximately $2.0 billion, of which $1.4 billion was insured by MBIA.

Engagement

Gordian Group was retained to advise MBIA with regard to the Spiegel bankruptcy and the related securitizations. This engagement involved extensive modeling to predict cash flows of the securitization portfolios.

Outcome

The matter reached an extremely successful conclusion for MBIA.