Moody's drops CIFG

Moody's Investors Service said it has downgraded the insurance financial strength ratings of CIFG Guaranty, CIFG Europe and CIFG Assurance North America, Inc. to B3, from Ba2, and continues its ratings review with direction uncertain.

Moody's commented that the rating actions reflect its expectation of substantially higher mortgage-related losses arising from CIFG's insured portfolio, as well as the possibility that certain troubled exposures could be commuted.

Moody's added that it believes that the terms of the troubled CDO commutation may have some elements that are typically associated with a distressed exchange, though such a determination is ultimately a matter of judgment.

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