Standard & Poor's Rating Service took ratings action against six bond insurers affected by the subprime mortgage crisis, and Moody's announced that it placed subsidiaries of XL Insurance on review for possible downgrade.
Yesterday, S&P said it took the actions because of "worsening expectation for the performance of insurance nonprime residential mortgage-backed securities and CDOs (collateralized debt obligation) of asset-backed securities."
The rating service said the six are expected to see claims and/or suffer rating downgrades that will affect their capital resources, making those resources insufficient at the current rating level.
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