Ambac Financial Group, Inc. (ABK to ABKFQ)

daniel888

daniel888

NYSE SUSPENDS TRADING IN AMBAC FINANCIAL GROUP
2010-11-09 13:50:17.140 GMT

(The following is a reformatted version of a press release issued by NYSE Regulation, obtained from www.nyse.com.)

NYSE Suspends Trading in Ambac Financial Group, Inc. and Related Securities; Moves to Remove from the List

NEW YORK, November 9, 2010 - NYSE Regulation, Inc. (“NYSE Regulation”) announced today that it determined that the common stock of Ambac Financial Group, Inc.  (the “Company”) - ticker symbol ABK - as well as the three related listed securities below should be suspended immediately.

Ticker          Issue
ABK PRZ      Corporate Units
AKF             5.95% Debentures due February 28, 2103
AKT             5.875% Debentures due March 24, 2103

NYSE Regulation has determined that the Company is no longer suitable for listing.  This decision was reached in view of the Company’s November 8, 2010 announcement that it voluntarily filed for relief under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.  NYSE Regulation noted the
uncertainty as to the timing and outcome of the bankruptcy process, as well as the ultimate effect of this process on the
Company’s common stockholders.

Additionally, the Company had previously been notified that it had fallen below the New York Stock Exchange’s (“NYSE”)
continued listing standard for average closing price of less than $1.00 over a consecutive 30 trading day period.

The Company has a right to a review of this determination by a Committee of the Board of Directors of NYSE Regulation.
Applications to the U.S. Securities and Exchange Commission to delist the issues are pending the completion of applicable
procedures, including any appeal by the Company of the NYSE Regulation staff decision. The NYSE noted that it may, at any time, suspend a security if it believes that continued dealings in the security on the NYSE are not advisable.

Company contact:
Peter Poillon
(212) 208-3222


Contact: Judy Shaw
Phone: 212-656-4290
Email:  jshaw@nyx.com

daniel888

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BN 11/09 22:33 *AMBAC QTR NET INVESTMENT INCOME $69.8M               :ABKFQ US
BN 11/09 22:33 *AMBAC QTR NET PREMIUMS EARNED $143.1M                :ABKFQ US
BN 11/09 22:33 *AMBAC SAYS AAC CLAIMS-PAYING RESOURCES ABOUT $7.9B AT QTR END
BN 11/09 22:32 Ambac Financial Group Reports Third-Quarter EPS of 25 Cents
BN 11/09 22:32 *AMBAC HAD $157.8M GAIN FROMTERMINATION OF ARRANGEMENT
BN 11/09 22:31 *AMBAC 3Q TOTAL NET LOSS, LOSS EXPENSES $165.4M       :ABKFQ US
BN 11/09 22:31 *AMBAC STATUTORY SURPLUS OF AAC DECREASED TO ABOUT $912M
BN 11/09 22:30 *CORRECT: AMBAC QTR EPS 25C                                    :
BN 11/09 22:30 *AMBAC FINANCIAL 3Q NET PREMIUMS EARNED DOWN 40%         :ABK US
BN 11/09 22:30 *AMBAC FINANCIAL 3Q NET PREMIUMS EARNED $143.1M          :ABK US
BN 11/09 22:30 *AMBAC FINANCIAL 3Q EPS 25C                              :ABK US

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Ambac Financial Group, Inc. Announces Third Quarter 2010 Results
2010-11-09 22:30:00.618 GMT

  Ambac Financial Group, Inc. Announces Third Quarter 2010 Results

Business Wire

NEW YORK -- November 09, 2010

Ambac Financial Group, Inc. (NYSE: ABK) (Ambac) today announced third quarter 2010 net income of $76.0 million, or $0.25 per diluted share. This compares to third quarter 2009 net income of $2,188.3 million, or $7.58 per diluted share. Relative to the third quarter 2009 results, the third quarter 2010 results reflect significantly reduced unrealized mark-to-market gains in the credit derivatives portfolio as the remaining exposure of the CDO of ABS portfolio which drove the unrealized gains in 2009 was commuted in June 2010. Third quarter 2010 results also reflect lower loss and loss expenses.

Third Quarter 2010 Summary

  * As previously announced, on November 1, 2010, Ambac did not make a regularly scheduled interest payment on Company debentures due May 1, 2023, and filed for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code on November 8, 2010.

  * Net change in fair value of credit derivatives was positive $9.4 million in the current quarter, down from $2,132.9 million in the third quarter 2009.

  * Net loss and loss expenses incurred amounted to $165.4 million for the current quarter, down from $459.2 million in the third quarter of 2009.

  * During the third quarter 2010, AAC commuted the reinsurance arrangement with its subsidiary, Ambac Assurance UK Ltd (“Ambac UK”) resulting in a net gain of $157.8 million (included in “Other income” in the Consolidated Statements of Operations).

  * The financial services segment recorded a $77.4 million operating loss primarily related to the impact of lower interest rates on the derivative products business.

  * Statutory surplus of Ambac Assurance Corporation (“AAC”) decreased to approximately $912 million at September 30, 2010 from $1.5 billion at June 30, 2010, driven primarily by statutory loss and loss expenses.

Financial Results

Implementation of New Accounting Standards

Effective January 1, 2010, Ambac adopted Accounting Standards Update No. (“ASU”) 2009-17, “Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities”. See prior quarters’ earnings releases for information on the financial impact of adoption. As of September 30, 2010, the Company's balance sheet included 23 consolidated VIEs with $19.2 billion of assets and $18.9 billion of liabilities.

Net Premiums Earned

Net premiums earned for the third quarter of 2010 were $143.1 million, down 40% from $238.4 million earned in the third quarter of 2009. Net premiums earned include accelerated premiums, which result from calls, terminations and other accelerations recognized during the quarter. Accelerated premiums were $30.0 million in the third quarter of 2010, down from $90.3 million in the third quarter 2009. Normal net premiums earned, which exclude accelerated premiums, were $113.1 million in the third quarter of 2010, down 24% from $148.1 million in the third quarter of 2009. Normal net premiums earned for the period have been negatively impacted by the lack of new business written and the high level of refundings and terminations over the past several quarters, as well as non-recognition of premiums earned on VIEs that have been consolidated as a result of implementation of ASU 2009-17, effective January 1, 2010.

Net Investment Income

Net investment income for the third quarter of 2010 was $69.8 million, representing a decrease of 49% from $137.6 million in the third quarter of 2009. The decrease was primarily driven by three factors: (i) a decrease in the invested asset base resulting from the second quarter 2010 commutation settlement on CDO of ABS transactions; (ii) the average yield on the portfolio decreased as the asset mix changed period to period; and (iii) a reduction in interest income related to securities in the financial guarantee investment portfolio that have insurance policies from AAC that were allocated to the Segregated Account. These insurance policies are subject to the payment moratorium ordered by the Office of the Commissioner of Insurance of the State of Wisconsin (“OCI”) in connection with the rehabilitation plan for the
Segregated Account of AAC.

Other-Than-Temporary Impairment Losses

Other-than-temporary impairment (“OTTI”) losses in the financial guarantee investment portfolio were $6.6 million in the third quarter of 2010, compared to OTTI losses of $32.5 million in the third quarter of 2009. The third quarter 2010 OTTI loss was driven primarily by impairment write downs on AAC-wrapped securities (which had insurance policies allocated to the Segregated Account) within its investment portfolio. The third quarter 2009 OTTI impairment loss was driven by write-downs of certain RMBS securities rated below investment grade within the investment portfolio that management
intended to sell in connection with its revised investment strategies.

Net Change in Fair Value of Credit Derivatives

The net change in fair value of credit derivatives, which comprises realized gains/(losses) and other settlements from credit derivatives and unrealized gains/(losses) on credit derivatives, was a gain of $9.4 million for the third quarter of 2010, compared to a gain of $2,132.9 million for the third quarter of 2009. Third quarter of 2009 results included the impact of fair value changes to the CDO of ABS portfolio, which was fully commuted in June 2010. The CDO of ABS portfolio contributed significantly to the volatility of the net change in fair value of credit derivatives throughout 2009.

Realized losses and other settlements from credit derivative contracts represent the normal accretion into income of fees received for transactions executed in credit derivative format, offset by loss and settlement payments on such transactions. Net realized gains/(losses) and other settlements from credit derivative contracts in the third quarter of 2010 and 2009 amounted to $4.9 million and ($732.9) million, respectively. The third quarter 2009 net realized loss was primarily driven by settlement and commutation payments on certain CDO of ABS transactions during that period.

Net unrealized gains on credit derivative contracts in the third quarter of 2010 and 2009 amounted to $4.5 million and $2,865.8 million, respectively. The net unrealized gain during the third quarter of 2010 is primarily the result of the net amortization of par outstanding on the underlying reference obligations of the remaining credit derivative portfolio. The third quarter 2009 net unrealized gain primarily reflects the effect of AAC’s widening credit spreads during that period on the fair value of CDO of ABS derivative liabilities, pricing improvements on underlying reference obligations, and the
reclassification of $732.9 million to realized losses, partially offset by the negative impact of rating downgrades on the fair value of CDO of ABS.