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Bond Insurers' International Underwriting Activities Are Shaped By Competitive Pricing Pressures
Standard & Poors, Oct 2005
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
Abstract
Competition from within the industry, as well as from banks, has had a considerable influence on the bond insurers' underwriting efforts. Along with the bond insurers that pioneered international financial guaranty expansion--Ambac Assurance Corp. (Ambac), Financial Security Assurance Inc. (FSA), and MBIA Insurance Corp. (MBIA)--those companies that have also initiated international marketing efforts are Financial Guaranty Insurance Co. (FGIC) and Assured Guaranty Corp. (AGC). Compounding the competition issue are XL Capital Assurance Inc. (XLCA), which has expanded its international efforts, and CIFG Financial Guaranty (CIFG), with its European roots. One only has to look at the following concerns recently voiced by senior management within the industry to highlight the effects, and possible frustrations, stemming from competition: Market spreads are compressed,...
Companies mentioned in this report are: Ambac Assurance Corp.,Financial Guaranty Insurance Co.,Assured Guaranty Municipal Corp.,MBIA Insurance Corp.,Assured Guaranty Corp,Syncora Guarantee Inc.,CIFG GUARANTY
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