Posted on 03/14/2008 1:02:37 AM PDT by TigerLikesRooster
Security Capital Assurance Halts Taking on New Business Amid $1.2 Billion Loss in 4th Quarter
March 13, 2008 - 6:13 p.m.
NEW YORK (AP) - Troubled bond insurer Security Capital Assurance Ltd. on Thursday posted a massive fourth-quarter loss and said it will stop writing new policies in an effort to preserve capital.
The Bermuda-based company reported it lost $1.2 billion, or $18.67 per share, in the last three months of the year as the value of securities backed by home loans the company insured deteriorated rapidly. During the same period in 2006, SCA posted a profit of $35.8 million, or 56 cents per share.
"We are continuing to explore our strategic options to generate or raise capital and improve our ratings," President and Chief Executive Paul S. Giordano said in a statement. "In the interim, we are in the process of realigning our cost structure to reflect the current business conditions and have made the strategic decision to cease writing new business for a period of time to preserve capital."
Last month, Moody's Investors Service cut SCA's financial-strength rating to "A3" from "AAA," making it harder for the company to attract new business and threatening the value of hundreds of billions of dollars in bonds.
SCA shares jumped 14 cents, or 21 percent, to 80 cents in after-hours trading.
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