S&P Adds Claims-Paying, Liquidity Analysis to Annual Reports

Smith, Aaron T.
March 2003
Bond Buyer;3/27/2003, Vol. 343 Issue 31802, p7
Trade Publication
Standard & Poor's Corp., the bond rating agency has publicized an analysis on the claims-paying ability and liquidity of bond insurers in its annual reports, the agency announced this week. In a prepared statement released earlier this week, Standard & Poor's said that � cash availability is the key consideration � in a bond insurer's ability to pay claims, and corporate earnings reports � do not always tell the full story and sometimes are not relevant in the context of paying claims.� Tom Abruzzo of Fitch Ratings Inc., who was promoted to managing director of financial guaranty this year, said annual bond-insurer reports issued by his department would include liquidity analysis. In July, Standard & Poor's released a study stating that the top four bond insurers � MBIA Insurance Corp., Financial Guaranty Insurance Co., Ambac Assurance Corp., and Financial Security Assurance Inc.� would be able to pay claims and maintain their triple-A ratings even if a depression forced municipalities to default and reinsurers to suffer downgrades.


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