Moody's Investors Service late Wednesday night said it will review for possible upgrade the B2 ratings of Syncora Guarantee Inc. and Syncora Guarantee Re Ltd. following the recent announcement that Syncora Holdings Ltd. had closed on its deals with former parent XL Capital Ltd. and Merrill Lynch & Co.

Moody's said the agreements will significantly improve the capital positions of Syncora Guarantee and Syncora Guarantee Re, but that concerns about remaining mortgage-related exposures and "franchise value" will likely prevent ratings from moving above investment grade.

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