Ambac Financial Group, Inc. (ABK)

Citadel7 (87.14) Submitted: 6/19/08 4:38 PM : Start Price: $2.08 ABK Score: 0.86

This is a bond insurer that has a terrible subprime portfolio. $800 billion worth of subprime loans will reset in the second half of this year (2007). $18.7 billion worth of subprime loans are sitting on AMBAC's books. The exposure is equal to 284.4% of statutory capital. Leverage (Face Value Bonds/Statutory Capital) is 80.8 to 1. AMBAC's loss of AAA status in the debt markets deprives it of the ability to raise funds competitively, which means it will soon starve to death.

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