UPDATE: Ambac Financial CFO Quits To 'Pursue Other Interests'
24 Novembre 2009 - 8:28PM
Dow Jones News
Ambac Financial Group Inc. (ABK) said Chief Financial Officer
Sean Leonard resigned, effective Tuesday, to pursue other
interests.
Shares doubled their losses on the news and were recently down
9.1% at 82 cents. The stock has slumped 43% the past year.
Until a replacement is named, the company said, his department
heads will report directly to Chief Executive David Wallis. Leonard
joined the struggling bond insurer as financial chief in 2005.
Last week, Ambac reported $856 million of surplus as of Sept.
30, easing concerns that it would fall short of statutory minimums.
Some Wall Street analysts had speculated the company would come up
short of the $2 million in minimum capital needed under rules set
up by its regulator, the Wisconsin Office of the Commissioner of
Insurance. A spokesman with the Wisconsin regulator did not
immediately return a phone call asking for comment.
Ambac was able to boost its regulatory capital just before
filing statutory returns last week when it was able to negotiate
the cancellation of four credit default swaps contracts worth $5.03
billion for cash payments of about $520 million.
Ambac is in discussions with lenders over about $1.9 billion of
claims it has made over residential loans in securities it insures.
In its third-quarter earnings call, Leonard said it might take up
to three years to complete the process of getting reimbursed for
the bad loans in the securities.
A spokeswoman at Ambac did not return a message asking what role
Leonard played in helping Ambac through the process.
Leonard's departure is the second high-profile resignation in
the past several months. In June, Ambac announced that it was
putting off the launch of its planned public-finance bond insurance
startup, Everspan, and that Douglas Renfield-Miller, executive vice
president of Ambac and chief executive of Everspan, would retire as
of the end of the year.
Ambac earlier this month posted a third-quarter profit on big
mark-to-market gains from credit derivative along with growing
insurance losses, particularly on mortgage-backed securities.
Other bond insurers also traded down recently, with shares of
MBIA Inc. (MBI) down 4.2% to $3.39 and Assured Guaranty Ltd. (AGO)
down 3.1% to $23.01.
-By Lavonne Kuykendall and Kathy Shwiff, Dow Jones Newswires;
(312) 750 4141; lavonne.kuykendall@dowjones.com
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