FGIC Corp. Reports $33.4M in 1Q Losses

FGIC Corp., parent of bond insurer Financial Guaranty Insurance Co., reported Friday that it lost $33.4 million for the first quarter, caused by a spike in its loss reserves to cover its book of collateralized debt obligations.

The loss compares to earnings of $68.5 million a year ago for the quarter that ended March 31. At that time, the bond insurer was rated triple-A by all three major rating agencies. Today, it is rated Baa3 by Moody’s Investors Service, BB by Standard & Poor’s, and BBB by Fitch Ratings.

FGIC reported that $279.2 million was set aside to cover losses on CDOs of mortgages written from 2005 through 2007. Net premiums earned, which were $84.9 million a year ago, fell to $30.5 million in the quarter this year.

For reprint and licensing requests for this article, click here.
MORE FROM BOND BUYER