Ambac Financial Group Inc. (ABKFQ), the bankrupt holding company for a failed bond insurer, reported a net loss of $939.9 million for March.
The net loss included $908 million in losses since the Nov. 8 bankruptcy filing tied to a wholly owned subsidiary, New York- based Ambac said in documents filed yesterday in U.S. Bankruptcy Court in Manhattan.
Professional fees for the Chapter 11 case have totaled $16 million, Ambac said. Cash fell to $36.1 million as of March 31 from $38.6 million at the start of the month. The company likely will be able to exit bankruptcy, though a Chapter 7 liquidation is possible, Ambac said in a quarterly filing to the U.S. Securities and Exchange Commission.
Ambac’s court reports are prepared in a format different from its financial statements to the SEC. Ambac’s loss was $819.3 million, or $2.71 a share, for the three months ended March 31, according to the quarterly SEC filing. In previous court reports, Ambac listed losses of $37 million in February and $83 million in January.
Since entering bankruptcy, Ambac has clashed with parties including its operating unit, Ambac Assurance Corp., over who gets $7.3 billion in net operating losses to use for tax benefits. The Internal Revenue Service has challenged claims by both companies to tax benefits.
If Ambac liquidates, it won’t be able to use such losses for tax benefits, the company said in its quarterly filing.
Ambac Assurance was the second-largest bond insurer before the 2008 financial crisis, when mounting defaults on mortgages swamped the company with claims. It guaranteed around $256 billion of $1.4 trillion in insured municipal debt, according to Bloomberg data. Ambac listed liabilities of $1.68 billion in its petition.
The holding company case is In re Ambac Financial Group Inc., 10-15973, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Tiffany Kary in New York at email@example.com.