NU Online News Service, March 23, 12:45 p.m. EDT
Ambac Financial Group Inc. reports a 2011 fourth-quarter net loss of more than $963 million as a combination of financial factors negatively impacted the company’s earnings.
The New York-based bond insurer says its fourth-quarter net loss grew by $882 million compared to the 2010 fourth quarter because of “higher net loss and loss expenses, derivative-product losses and higher losses on variable-interest entities.”
The fourth-quarter results translate into net loss per share of $3.18 compared to net loss per share of 27 cents for 2010.
Fourth-quarter revenues came in at a loss of $81 million compared to positive-$191 million for the 2010.
For the year, Ambac reports a net loss of $1.96 billion compared to 2010 net loss of more than $753 million.
Revenues on the year were down from $434 million in 2010 to $296 million.
The company entered into bankruptcy reorganization in 2010 after suffering losses on its book of structured financial products, specifically residential mortgage back securities, during the economic crisis of 2008.
The company’s financial guaranty insurer, Ambac Assurance established a segregated account for those liabilities in 2010 and has been under rehabilitation under the supervision of the Office of the Commissioner of Insurance for the State of Wisconsin since.
Just last week, a federal bankruptcy judge granted Ambac the go ahead with its reorganization plan.
The company says in today’s statement that it “is not currently able to estimate when it will be able to consummate such reorganization” and will continue to operate under the bankruptcy laws until its reorganization is complete.
Ambac says unpaid claims submitted to Ambac Assurance during the fourth quarter amounted to $317 million. Since the account was established in 2010, total claims stand at $2.77 billion and remain unpaid while it is bankruptcy.
The company says its loss reserves for RMBS as of the end of 2011 stand at more than $4.45 billion, including the unpaid claims.