Spitzer and Dinallo to Testify at Bond Insurer Committee Hearing in NY
Scheduled to testify on Thursday at a House Financial Services subcommittee hearing on bond insurer problems are New York Gov. Eliot Spitzer and New York State Insurance Superintendent Eric Dinallo.
Also scheduled to testify at the hearing are senior executives of Pershing Square Capital Management, Fitch Ratings, Ambac Financial Group Inc, according to a statement by the subcommitee.
U.S. bond insurers, which guarantee more than $2.4 trillion of debt, have been hit with losses after insuring repackaged sub-prime mortgage securities.
The hearing was called by Rep. Paul Kanjorski, a Pennsylvania Democrat who heads a House subcommittee that oversees capital markets and the insurance industry. Last week, Kanjorski said the input he received from the Federal Reserve, the Securities and Exchange Commission, and others convinced him that there is a need for reform.
Kanjorski expressed concern about the effects of recent ratings downgrades of bond insurers on municipal debt markets. Local municipalities, counties and states often rely on bond insurance to lower their borrowing costs for building bridges, repairing roads, fixing schools and other local projects.
Published on February 13, 2008
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