Moody's reviews Ambac

Moody's Investors Service said it placed Ambac Financial Group, Inc.'s senior unsecured debt rating of Aa3 on review for downgrade.

The review reflects Moody's growing concerns regarding Ambac's overall credit profile, including the company's significantly constrained new business prospects and financial flexibility, as well as possible increased expected and stress loss projections among its mortgage-related risk exposures, the agency said.

The review also reflects concerns about the deterioration in the company's financial flexibility since the company's $1.5 billion capital raise in March, as evidenced by the substantial decline in the firm's market capitalization and high current spreads on its debt securities, Moody's said.

There is meaningful uncertainty surrounding Ambac's ability to regain market acceptance and underwriting traction in its target markets, the agency noted.

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