MBIA Inc., the bond insurer suing Bank of America Corp. to recover losses tied to mortgage loans, won an appeals court ruling that the lender could be required to repurchase securitized loans even if they are not in default, Bloomberg News reported yesterday. MBIA is entitled to have Bank of America buy back a performing loan that it can prove "materially and adversely" affected its interest, the New York state appeals panel said in a decision yesterday, reversing part of a ruling by a lower court. The panel also reversed a decision that MBIA could seek so-called rescissory damages. The decision stems from MBIA's lawsuit against Bank of America and its Countrywide Financial unit. MBIA, which sued Countrywide in 2008, guarantees payments to investors that bought securities backed by pools of the lender's loans. The insurer says the loans were riskier than represented by Countrywide, and as the loans went into default, the Armonk, N.Y.-based company was forced to pay investors.
