Ambac Financial Group Inc. yesterday reported a net loss of $3.3 billion for the fourth quarter of 2007, based on a pretax mark-to-market loss of $5.4 billion in the company’s credit derivatives portfolio.

The loss was blamed in part on more than $1.1 billion in credit impairment related to collateralized debt obligations tied to mezzanine-level subprime residential mortgage-backed securities, caused by a recent evaluation and subsequent internal downgrade by Ambac of those securities to below investment grade.

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