Fresh off of it’s Moody’s downgrade yesterday, FGIC is requesting that it split its businesses into two companies, one retaining munis, and the other getting left with the crap. As the news broke, Eric Dinallo, NY’s insurance commissioner was appearing on CNBC. He confirmed FGIC’s request, and noted that it’s not a done deal, that a cash injection bailout was still possible…
Financial Guaranty Insurance Co., a major
bond insurer, has notified the New York State Insurance Department that it will
request to be split into two companies, according to a person familiar with the
matter.One of the firms would likely retain much
of the business of insuring structured finance bonds such as those backed by
mortgages, which have come under severe pressure due to the housing market
slowdown, according to the person.The other company would likely retain most
of the municipal bond insurance business, which is stronger, the person said.
FGIC Will Request Break-Up – Wall Street Journal
Tags: Bond Insurers, CNBC, Credit Crunch
