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Archive for the 'Bond ratings' Category

Standard & Poor’s affirms ratings on MBIA


Standard & Poor’s Rating Services yesterday affirmed its AA financial-strength rating of MBIA Inc., and removed the rating from credit watch negative.

S&P’s outlook for the troubled Armonk-based bond insurer is negative, S&P said.

“We assigned a negative outlook to MBIA due to its significant exposure to domestic nonprime mortgages and related exposures,” S&P credit analyst David Veno said in a statement.

Removal of the negative outlook, Veno said, “will depend on clarification of ultimate potential losses as well as future business prospects.”

The possibility of new regulations and the outcome of MBIA’s business decisions are also factors, he said.

Posted by David Schepp on Friday, August 15th, 2008 at 12:07 pm |
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MBIA shares fall in wake of downgrade


Shares of MBIA Inc. tumbled 13 percent today after Moody’s Investor Service stripped the struggling Armonk-based bond insurer of its prized Aaa rating, Moody’s highest.

Moody’s downgraded MBIA’s rating two notches to A2. Moody’s also downgraded the rating for MBIA rival Ambac Financial Group Inc. one step to Aa.

The move, taken late Thursday, followed similar actions by Fitch Ratings and Standard & Poor’s.

“MBIA’s insured portfolio remains vulnerable to further economic deterioration,” Moody’s said in a statement. “The outlook for the ratings is negative, reflecting the material uncertainty about the firm’s strategy and the … likelihood of further adverse developments in its insurance portfolios or operations.”

MBIA has recorded heavy losses largely due to its exposure to the weak housing market and a troubled market for subprime mortgages to riskier borrowers.

For its part, MBIA said yesterday that it was “disappointed” by Moody’s decision, saying it was “baffled” by the ratings agency’s analysis.

“We believe the fundamentals of the company support a higher rating,” MBIA said.

MBIA shares ended the week’s trading down 86 cents to $5.59 each. The stock has fallen more than 91 percent in the last year.

Posted by David Schepp on Friday, June 20th, 2008 at 3:45 pm |
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Fitch to continue MBIA ratings


Fitch Ratings said that it will continue rating the financial strength and debt of MBIA Inc., the Armonk-based bond insurer. MBIA sparked controversy earlier this month when it asked Fitch to quit rating the company because of a dispute over Fitch’s methodology.
MBIA has suffered heavy losses stemming from its exposure to subprime mortgages.

“We are disappointed that MBIA has requested that we withdraw our (insurer financial strength) ratings and that they have decided to stop providing us important non-public information about their portfolio,” Stephen W. Joynt, president and chief executive officer of Fitch Ratings, said in a written statement. “While we respect MBIA’s decision not to provide us that information, we trust that they will respect our decision to continue to maintain a rating on MBIA, a company about which many investors are so clearly interested.”

C. Edward Chaplin, chief financial officer of MBIA, said that Fitch may have problems continuing its ratings.

“Due to market developments, we believe that the non-public information currently in Fitch’s possession soon will become out of date, and public information alone will be insufficient to maintain the ratings,” Chaplin said in a written statement.

Posted by Jay Loomis on Monday, March 24th, 2008 at 3:10 pm |
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S&P downgrades rating on Reader’s Digest debt


Standard & Poor’s Ratings Services lowered its ratings on Reader’s Digest Association Inc.’s corporate credit rating to “B-” from “B,” and revised its outlook on the venerable publisher to stable from negative, the bond-rating company said yesterday.

Standard & Poor’s cited the Chappaqua-based publisher’s higher debt levels, lower earnings and negative cash flow as reasons for the downgrade.

S&P also expressed concern regarding management’s ability to stem business declines at its school and educational services operations, complete restructuring initiatives and resume profitability growth over the near term.

S&P noted Reader’s Digest total debt as of Dec. 31 was $2.08 billion.

Posted by David Schepp on Monday, March 17th, 2008 at 3:53 pm |
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