Ambac Continues Significant Reduction of Insured Net Par Exposure in the Fourth Quarter of 2015
Reduced Net Par Outstanding in the Insured Portfolio by $10.7 Billion
in the Quarter
Adversely Classified Net Par Exposures Reduced by 9% in the Quarter
NEW YORK--(BUSINESS WIRE)--
Ambac Financial Group, Inc. (Nasdaq:AMBC) ("Ambac"), today announced
that its principal operating subsidiaries, including Ambac Assurance
Corporation ("AAC"), collectively reduced the net par exposure of their
insured portfolios by 9% during the quarter ended December 31, 2015 to
approximately $108.3 billion from $119.0 billion at September 30, 2015.
Adversely Classified Credits also were reduced by approximately 9%, or
$2.0 billion, in the fourth quarter.
The $10.7 billion reduction in net par was accelerated by several
company-led initiatives, including the following notable transactions:
$882 million of net par exposure to Eurotunnel; $111 million of net par
exposure to pooled aircraft lease securitizations; $603 million of
student loan net par exposure, including $182 million to South Carolina
Student Loan Corp. and $399 million to National Collegiate Student Loan
Trust; and $229 million of net par exposure to the Puerto Rico Highways
and Transportation Authority.
Commenting on today's announcement, Nader Tavakoli President and Chief
Executive Officer said, "One of our highest priorities has been and
remains the reduction of our insured portfolio, especially our
distressed exposures. The hard work and dedication of our team has
resulted in successful liability management throughout 2015, during
which our insured portfolio net par has been reduced by a full 25%, or
$36.4 billion. While this rate of reduction may be hard to sustain going
forward, we are very pleased with our risk reduction accomplishments
As of December 31, 2015, public finance was 60% of the total net par
outstanding, structured finance was 20% and international was 20%. The
General Account represented 69% of the total net par outstanding, AmbacUK was 17% and the Segregated Account was 14%.
Along with other policy accelerations, the aforementioned net par
reductions contributed to accelerated premiums earned in the fourth
quarter of 2015 which are currently estimated to be $73 million, an
increase of $44 million, or 156%, from the third quarter of 2015. The
amounts of accelerated premium income and reductions in net par
outstanding noted above are not indicative of our consolidated operating
results or financial condition for the quarter ended December 31, 2015.
Ambac Financial Group, Inc. ("Ambac"), headquartered in New York City,
is a holding company whose subsidiaries, including its principal
operating subsidiary, Ambac Assurance Corporation ("Ambac Assurance"),
Everspan Financial Guarantee Corp., and Ambac Assurance UK Limited,
provide financial guarantees and other financial services to clients in
both the public and private sectors globally. Ambac Assurance, including
the Segregated Account of Ambac Assurance (in rehabilitation), is a
guarantor of public finance and structured finance obligations. Ambac is
also selectively exploring opportunities involving the acquisition
and/or development of new businesses. Ambac‘s common stock trades on the
NASDAQ Global Select Market under the symbol "AMBC". The Amended and
Restated Certificate of Incorporation of Ambac contains substantial
restrictions on the ability to transfer Ambac's common stock. Subject to
limited exceptions, any attempted transfer of common stock shall be
prohibited and void to the extent that, as a result of such transfer (or
any series of transfers of which such transfer is a part), any person or
group of persons shall become a holder of 5% or more of Ambac's common
stock. Ambac is committed to providing timely and accurate information
to the investing public, consistent with our legal and regulatory
obligations. To that end, we use our website to convey information about
our businesses, including the anticipated release of quarterly financial
results, quarterly financial, statistical and business-related
information, and the posting of updates to the status of certain primary
residential mortgage backed securities litigations. For more
information, please go to www.ambac.com.
Certain statements in this press release are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act. These statements are based on management's current
expectations and are subject to uncertainty and changes in
circumstances. Actual results may differ, possibly materially, from
those included in these statements due to a variety of factors.
Important factors that could cause our results to differ, possibly
materially, from those indicated in the forward-looking statements
include, among others, those discussed under "Risk Factors" in Part I,
Item 1A of Ambac's 2014 Annual Report on Form 10-K and in Part II, Item
1A of each of our Quarterly Reports on Form 10-Q for the quarters ended
March 31, 2015, June 30, 2015, and September 30, 2015.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160211005441/en/
Ambac Financial Group, Inc.
Abbe F. Goldstein, CFA, 212-208-3222
Director, Investor Relations and Corporate Communications
Source: Ambac Financial Group, Inc.
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