Ambac Financial Group Inc. and Ambac Assurance Corp. executive vice president John W. Ulhein 3d resigned from his position last week, the company revealed Monday in a filing with the Securities and Exchange Commission.

Ulhein's resignation takes effect Feb. 1, 2009. In the meantime, he will remain with the company as it transitions his responsibilities.

Moody's Investors Service last week placed the Aa3 insurer financial strength rating of Ambac Assurance on review for downgrade due to an increase in projected losses on subprime residential mortgage securities-backed exposures. Ambac said any downgrade could trigger collateral postings that would leave it with a shortfall of between $1 billion and $2.1 billion in its investment agreement portfolio.

In addition, the downgrade has prompted the insurer to put its planned $850 million recapitalization of Connie Lee Insurance Co. on hold. Ambac had expected Connie Lee to write business as a muni-only insurer as early as the fourth quarter of this year.


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