The troubled rating's landscape for guaranty insurers continued after Moody's Investors Service took action on the insurance financial strength of two carriers late Friday.

Moody's said it placed the insurance financial strength of FGIC Corp.'s main operating subsidiaries under review and downgraded the insurance financial strength of two Syncora Holding's subsidiaries.

The insurance financial strength of "B1" of FGIC's subsidiaries, including Financial Guaranty Insurance Company and FGIC UK Ltd., was placed under review because Moody's said it expects additional stress on the underwriter's risk-adjusted capital position "in light of continued deterioration in housing fundamentals and the related implications on the company's mortgage-related exposures.

Moody's downgraded the "B2" rating of Syncora Guarantee Inc. and Syncora Guarantee (U.K.) Ltd. to "Caa1." The ratings are under review with direction uncertain.

The financial strength of Syncora Guarantee Re Ltd. was also downgraded to "Caa1" from "B2" and withdrawn after its merger with Syncora Guarantee.

Moody's said it is concerned with higher mortgage related losses in the company's portfolio as well as ongoing negotiations over termination of credit default swap obligations. The action reflects the uncertainty over the outcome of those negotiations.

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Moody's Takes Action On Two Guaranty Insurers

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