SOURCE: The Bedford Report

The Bedford Report

February 04, 2011 08:46 ET

Ambac & Assured Guaranty Continue to Face Analyst Scrutiny

The Bedford Report Provides Analyst Research on Ambac Financial & Assured Guaranty

NEW YORK, NY--(Marketwire - February 4, 2011) - The Surety & Title Insurance sector has struggled early in 2011. Insurers hold as much as two-thirds of their assets in bonds, and as such are highly sensitive to credit market conditions. Analysts expect that weak investment portfolios and reduced income from the variable annuities, in addition to weak underwriting, will make for downside pressure on these companies in the coming months. The Bedford Report examines the outlook for companies in the Surety & Title Insurance Industry and provides research reports on Ambac Financial Group, Inc. (PINKSHEETS: ABKFQ) and Assured Guaranty Ltd. (NYSE: AGO). Access to the full company reports can be found at:

Maintaining a high credit rating is critical to the success of a bond insurer as these companies rely on a high credit rating to allow themselves to guarantee lower rated debt. After experiencing catastrophic losses following the 2007 subprime mortgage crisis, bond insurers began to lose their AAA ratings and were forced to stop selling new guarantees. S&P announced that there are nine new categories and that companies will likely have to raise additional capital and lower risk if they want to achieve high investment grades. This change comes in response to the bout of companies that lost AAA investment grades during the financial crisis. In fact, Ambac was forced into pursuing a restructuring of their business when the crisis took place. S&P also changed its criteria for mortgage-backed bonds and other securities after assigning top ratings to financial instruments that later collapsed in value during the credit crisis.

The Bedford Report releases regular market updates on the Surety & Title Insurance Industry so investors can stay ahead of the crowd and make the best investment decisions to maximize their returns. Take a few minutes to register with us free at and get exclusive access to our numerous analyst reports and industry newsletters.

In late January shares of Assured Guaranty -- the only active investment-grade rated municipal bond insurer -- fell heavily as the company admits it is "astonished" at S&P's proposal. Assured Guaranty's main insurance units are rated AA+ by S&P, but the company says it would have a capital shortfall of about $1.9 billion to support a AA credit rating under S&P's new bond insurance proposal. S&P analysts said they would take into account comments for Assured Guaranty on a proposed change, however.

In late 2010, Ambac requested that Standard and Poor's Ratings Services withdraw its ratings of the company.

The Bedford Report provides Analyst Research focused on equities that offer growth opportunities, value, and strong potential return. We strive to provide the most up-to-date market activities. We constantly create research reports and newsletters for our members. The Bedford Report has not been compensated by any of the above-mentioned publicly traded companies. The Bedford Report is compensated by other third party organizations for advertising services. We act as an independent research portal and are aware that all investment entails inherent risks. Please view the full disclaimer at

Contact Information