The credit crisis claimed its first bond insurer as Fitch Ratings Friday downgraded Ambac Assurance Corp.’s insurer financial strength rating to double-A from triple-A after the insurer announced it would abandon the capital raising plan it first announced last week in an effort to maintain its top rating.

Citing the insurer’s capital shortfall, the rating agency made the decision to cut the bond insurer and also dropped the rating of Ambac’s parent, Ambac Financial Group Inc., to A from AA. Both new ratings remain on negative watch.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.