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The state of California, the country’s largest issuer of municipal bonds, has decided to stop using municipal-bond insurance, a huge blow to the struggling industry, according to a report on CNBC.    “In the current market–and given the condition of the bond insurers–it makes no sense,” Tom Dresslar, the Director of Communication for California State… Continue reading CA Stops Using Muni-Bond Insurance

Early Tuesday morning Federal Reserve Chairman Ben Bernanke called for additional action to be taken to prevent more distressed homeowners from falling into foreclosure.     In a speech to a banking group in Florida, Bernanke said “the situation calls for a vigorous response.”     Bernanke warned that even with some relief efforts under… Continue reading Fed Chairman Calls for More Action to Stave Off Foreclosures

According to CNBC, Citigroup’s job cuts could reach 30,000 or more over the next year and a half because of increasing write-downs from sub-prime-related debt.     The layoffs would exceed the previously reported 24,000 job cuts that had been expected at the banking giant.     Chief Executive Vikram S. Pandit is currently conducting… Continue reading CNBC: Citigroup Could Cut 30,000 Jobs Over Next Eighteen Months

The largest U.S. mortgage insurer MGIC Investment Corp announced on Monday that it plans to sell shares to help increase capital at its main subsidiary Mortgage Guaranty Insurance Co. The company has yet to decide on the size of the planned offering, but planned to make that decision by mid-to-late-March.     The funds from… Continue reading MGIC Plans to Sell Shares in Effort to Increase Capital

On Monday mortgage insurer PMI Group estimated a significant fourth-quarter net loss from its financial guaranty segment, and reported a net loss of $236 million in its U.S. mortgage insurance operation for the same period. PMI earned $33 million from its financial guaranty segment, and $217.3 million from its U.S. mortgage business in the same… Continue reading PMI Estimates Substantial Fourth-Quarter Loss

In a statement made by Munich Re’s insurance unit ERGO on Tuesday, the insurer anticipates net profit to decline between 480-600 million euros ($728-$910 million) this year, due to lower tax benefits and investment earnings.    ERGO’s net profit fell to 781 million euros in 2007 from 889 million the previous year.    Germany’s second-biggest… Continue reading Munich Re’s ERGO Unit Expects Profit Decline for ’08

According to a “Financial Times” report , the second biggest U.S. Bond insurer Ambac Financial Group Inc has decided against splitting in two as part of a $2 billion to $3 billion recapitalization.    Under a recent proposal Ambac would have split its operations into a triple-A-rated municipal bond insurance business and a structured finance… Continue reading Ambac Reverses Decision to Split Company

The largest U.S. mortgage lender, Countrywide Financial, said it may see more credit losses as downward trends in the economy and in the real estate market conspire to boost delinquency rates.    In its annual filing with the Securities and Exchange Commission, released Friday, Countrywide said rising monthly payments on adjustable-rate mortgage loans, also known… Continue reading Countrywide May See More Credit Losses

Does Wall Street underrate Main Street? A growing number of states and cities say yes. If they are right, billions of taxpayers’ dollars — money that could be used to build schools, pave roads and repair bridges — are being siphoned off in the financial markets, where the recent tumult has driven up borrowing costs… Continue reading States and Cities Want to Change How Bonds are Rated

To an industry slowly recovering from a four-year period of intense regulatory scrutiny, the recent federal jury decision to convict five former senior insurance executives of securities fraud in connection with a finite reinsurance deal is yet another black eye, experts say in a story in “BestWeek” U.S./Canada.    Many are expecting the guilty verdicts… Continue reading BestWeek: Guilty Verdict in Finite Re Trial Is Mixed Blessing for Industry, Experts Say