MBIA, whose grade improved to A- from BBB, gained as much as 6.7 percent with S&P citing the potential success of its National Public Finance Guarantee unit. Assured rose as much as 5 percent after the ratings firm said its “competitive position remains strong relative to peers” in a separate report that boosted the ratings to AA from AA-.
MBIA and Assured are the leading companies still seeking to insure municipal bonds after rivals suffered losses on guarantees of subprime-mortgage-backed debt they’d backed in an expansion of the business.
The new MBIA rating “will significantly enhance its financial flexibility and provide us with greater opportunities to reduce holding-company leverage over time,” Chief Executive Officer Jay Brown said today in a statement. Dominic Frederico, CEO of Hamilton, Bermuda-based Assured, said in a separate statement the company was pleased that S&P has “recognized the strength of our competitive position.”
MBIA shares ended the day up 3.2 percent at $14.64, while Assured rose 4.6 percent to $26.65.
To contact the editors responsible for this story: Shannon D. Harrington at email@example.com Mitchell Martin