Nov. 14 (Bloomberg) -- Less than a week after MBIA Inc. gained the advantage in its three-year legal fight with Bank of America Corp. over toxic mortgage debt, the tables have turned on the bond insurer.

MBIA shares fell the most in three years and credit-default swaps tied to its debt surged by the most since July 2009 after Bank of America offered yesterday to buy the insurer’s $329.1 million of 5.7 percent bonds due in December 2034. That would block MBIA’s plan to distance itself from its cash-strapped MBIA Insurance Corp. unit by paying bondholders to change terms governing almost $900 million in debt.

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