Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
Wis. regulator files plan for seized Ambac securities
MADISON, Wis. (10/13/10)--The Wisconsin regulator of Ambac Assurance Corp. (AAC), the monoline U.S. bond insurer whose securities were seized in March, has filed a plan to wind down more than $50 billion left in insurance policies related to the seized securities. Several corporate credit unions have mortgage-related investments insured by Ambac and incurred losses during the financial crisis. The Wisconsin Office of the Commissioner of Insurance (OCI) said that under the plan, holders of allowed claims will receive 25% of their claims in cash and another 75% in notes that pay interest of 5.1% and mature June 7, 2020 (Reuters via Insurance Journal Oct. 12 and pr-usa.net Oct. 12). The 75% payout in notes reflects the need to preserve cash to pay current and future claims, the regulator said In March the insurance commissioner placed $67 billion of Ambac's assets into a segregated account to help protect investors of Ambac Assurance Corp. in the Dane County Circuit Court in Madison, Wis. Ambac's assets included credit derivatives and residential mortgage-backed securities. Roughly 700 in-force policies covering a net par outstanding amount of about $50 billion are allocated to the segregrated accounts. OCI has monitored the company's financial health since the mortgage crisis began in 2008. The economic downturn and the mortgage-related exposures damaged AAC's business and financial position. AAC's parent company, Ambac Financial Group, which is headquartered in New York, is not regulated in Wisconsin and not subject to the plan's terms. AAC is domiciled in Wisconsin. The court must approve the plan before it goes into effect, said Reuters.


RSS print
News Now LiveWire
Goodwill Industries latest to report data security breach http://t.co/gIaXNsT4Bk
9 hours ago
CUNA economist Schenk discusses regulators' focus on interest-rate risk. See CU Magazine: http://t.co/tW1p9rTSSv
11 hours ago
Fed issues annual report on general-use prepaid cards in gov't-administered payment programs. http://t.co/3zPhejSPZt
11 hours ago
Children in foster care face higher risk of identity theft via @NBCNews http://t.co/Dif0hCfBdA
11 hours ago
.@Cornerstone_CUL's leadership conference includes food drive for San Antonio food bank http://t.co/h2O8O4TxuD
12 hours ago