Fitch withdraws ratings on Ambac, MBIA
I don't know which is more alarming... the fact that the ratings have been withdrawn, depriving investors of their right to know something about the financial state of two companies that are cricual to the health of so many other kinds of investment vehicles... or whether the rating was pulled at the request of the companies in question. The latter leaves me with a very uneasy feeling.
Fitch withdraws ratings for Ambac, MBIA
Thursday June 26, 3:45 pm ET
Fitch pulls ratings for bond insurers Ambac, MBIA after they halt private information flow NEW YORK (AP) -- Fitch Ratings has withdrawn its ratings for Ambac Financial and MBIA Inc. after the troubled bond insurers stopped providing private information to the agency.
MBIA and Ambac separately had asked Fitch to withdraw the ratings after the agency stripped the insurers of their all-important "AAA" rating. The two stopped providing Fitch with information that was not publicly available.
Fitch said it will consider reinstating coverage and assigning new ratings based only on public information if there is continuing investor interest.
The bond insurers have been under pressure since insuring a number of mortgage-backed bonds with troubled underlying assets, risking an increase in claims. That forced the insurers to boost capital reserves and cost them their top-notch ratings.