Thursday, February 7, 2008
Fitch Ratings estimates that bond insurers collectively are exposed to about $100 billion in CDOs backed by deteriorating subprime mortgage collateral. Efforts to prevent drastic downgrades in the triple-A rating essential to a bond insurer's business are underway. MBIA says it will sell $750 million of common shares to raise capital. Consortia of banks are working on rescue plans for FGIC and Ambac. WSJ, Rescue Plans Won't Prevent Downgrades.