Ambac Financial Group (NYSE: AMBC), a financial services holding
company whose subsidiaries include Ambac Assurance Corporation
(“Ambac”), announced that on August 29, 2022, the Supreme Court of
the State of New York issued a decision denying Countrywide’s
motion for summary judgment in the case entitled Ambac Assurance
Corporation and the Segregated Account of Ambac Assurance
Corporation v. Countrywide Home Loans, Inc., Countrywide Securities
Corp., Countrywide Financial Corp., and Bank of America Corp.
(Supreme Court of the State of New York, County of New York, Case
No. 653979/2014, filed on December 30, 2014).
Ambac is pleased with the Court’s decision to allow its fraud
case against Countrywide and Bank of America to go forward to trial
in front of a jury. Trial is scheduled to commence in January 2024,
although the Court indicated that it may reschedule the trial for
an earlier time if its calendar permits. Through this case, Ambac
seeks to prove that Countrywide made false and intentionally
misleading representations to Ambac about, among other things, its
mortgage origination practices and the purported quality of its
mortgage loans. Ambac seeks to recover hundreds of millions of
dollars in losses, as well as punitive damages.
In addition to this case, Ambac continues to pursue additional
claims against Bank of America and related entities in the cases
entitled Ambac Assurance Corporation and The Segregated Account of
Ambac Assurance Corporation v. Countrywide Securities Corp.,
Countrywide Financial Corp. (a.k.a. Bank of America Home Loans) and
Bank of America Corp. (Supreme Court of the State of New York,
County of New York, Case No. 651612/2010, filed on September 28,
2010), in which trial will begin on September 7, 2022, and Ambac
Assurance Corporation and The Segregated Account of Ambac Assurance
Corporation v. First Franklin Financial Corporation, Bank of
America, N.A., Merrill Lynch, Pierce, Fenner & Smith Inc.,
Merrill Lynch Mortgage Lending, Inc., and Merrill Lynch Mortgage
Investors, Inc. (Supreme Court of the State of New York, County of
New York, Case No. 651217/2012, filed April 16, 2012).
The August 29, 2022, decision will not impact the estimated
subrogation recoveries on Ambac’s balance sheet, which relate only
to contract-based litigation claims and not to fraud claims.
About Ambac Ambac Financial Group, Inc. (“Ambac” or
“AFG”) is a financial services holding company headquartered in New
York City. Ambac’s core business is a growing specialty P&C
distribution and underwriting platform. Ambac also has a legacy
financial guaranty business in run off. Ambac’s common stock trades
on the New York Stock Exchange under the symbol “AMBC”. Ambac is
committed to providing timely and accurate information to the
investing public, consistent with our legal and regulatory
obligations. To that end, we use our website to convey information
about our businesses, including the anticipated release of
quarterly financial results, quarterly financial, statistical and
business-related information. For more information, please go to
www.ambac.com.
The Amended and Restated Certificate of Incorporation of Ambac
contains substantial restrictions on the ability to transfer
Ambac’s common stock. Subject to limited exceptions, any attempted
transfer of common stock shall be prohibited and void to the extent
that, as a result of such transfer (or any series of transfers of
which such transfer is a part), any person or group of persons
shall become a holder of 5% or more of Ambac’s common stock or a
holder of 5% or more of Ambac’s common stock increases its
ownership interest.
Forward-Looking Statements In this press release,
statements that may constitute “forward-looking statements” within
the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Words such as “estimate,” “project,”
“plan,” “believe,” “anticipate,” “intend,” “planned,” “potential”
and similar expressions, or future or conditional verbs such as
“will,” “should,” “would,” “could,” and “may,” or the negative of
those expressions or verbs, identify forward-looking statements. We
caution readers that these statements are not guarantees of future
performance. Forward-looking statements are not historical facts
but instead represent only our beliefs regarding future events,
which may by their nature be inherently uncertain and some of which
may be outside our control. These statements may relate to plans
and objectives with respect to the future, among other things which
may change. We are alerting you to the possibility that our actual
results may differ, possibly materially, from the expected
objectives or anticipated results that may be suggested, expressed
or implied by these forward-looking statements. Important factors
that could cause our results to differ, possibly materially, from
those indicated in the forward-looking statements include, among
others, those discussed under “Risk Factors” in our most recent SEC
filed quarterly or annual report.
Any or all of management’s forward-looking statements here or in
other publications may turn out to be incorrect and are based on
management’s current belief or opinions. Ambac Financial Group’s
(“AFG”) and its subsidiaries’ (collectively, “Ambac” or the
“Company”) actual results may vary materially, and there are no
guarantees about the performance of Ambac’s securities. Among
events, risks, uncertainties or factors that could cause actual
results to differ materially are: (1) the highly speculative nature
of AFG’s common stock and volatility in the price of AFG’s common
stock; (2) uncertainty concerning the Company’s ability to achieve
value for holders of its securities, whether from Ambac Assurance
Corporation (“AAC”) and its subsidiaries or from the specialty
property and casualty program insurance business, the distribution
business, or related businesses; (3) the inability of AAC to
realize the expected recoveries, including RMBS litigation
recoveries, included in its financial statements, or changes in
estimated RMBS litigation recoveries over time; (4) failure to
recover claims paid on Puerto Rico exposures or realization of
losses in amounts higher than expected; (5) inadequacy of reserves
established for losses and loss expenses and possibility that
changes in loss reserves may result in further volatility of
earnings or financial results; (6) potential for rehabilitation
proceedings or other regulatory intervention against AAC; (7)
credit risk throughout Ambac’s business, including but not limited
to credit risk related to insured residential mortgage-backed
securities, student loan and other asset securitizations, public
finance obligations (including risks associated with Chapter 9 and
other restructuring proceedings), issuers of securities in our
investment portfolios, and exposures to reinsurers; (8) our
inability to effectively reduce insured financial guarantee
exposures or achieve recoveries or investment objectives; (9) our
inability to generate the significant amount of cash needed to
service our debt and financial obligations, including through
litigation recoveries or disposition of assets, and our inability
to refinance our indebtedness; (10) Ambac’s substantial
indebtedness could adversely affect its financial condition and
operating flexibility; (11) Ambac may not be able to obtain
financing or raise capital on acceptable terms or at all due to its
substantial indebtedness and financial condition; (12) the impact
of catastrophic public health, environmental or natural events,
including events like the COVID-19 pandemic, or global or regional
conflicts, on significant portions of our insured portfolio; (13)
credit risks related to large single risks, risk concentrations and
correlated risks; (14) risks associated with adverse selection as
Ambac’s financial guarantee insurance portfolio runs off; (15) the
risk that Ambac’s risk management policies and practices do not
anticipate certain risks and/or the magnitude of potential for
loss; (16) restrictive covenants in agreements and instruments that
impair Ambac’s ability to pursue or achieve its business
strategies; (17) adverse effects on operating results or the
Company’s financial position resulting from measures taken to
reduce financial guarantee risks in its insured portfolio; (18)
disagreements or disputes with Ambac's insurance regulators; (19)
loss of control rights in transactions for which we provide
financial guarantee insurance; (20) adverse tax consequences or
other costs resulting from the characterization of the AAC’s
surplus notes or other obligations as equity; (21) risks attendant
to the change in composition of securities in the Ambac’s
investment portfolio; (22) adverse impacts from changes in
prevailing interest rates; (23) events or circumstances that result
in the impairment of our intangible assets and/or goodwill that was
recorded in connection with Ambac’s acquisition of 80% of the
membership interests of Xchange Benefits, LLC; (24) risks
associated with the expected discontinuance of the London
Inter-Bank Offered Rate; (25) factors that may negatively influence
the amount of installment premiums paid to Ambac; (26) risks
relating to determinations of amounts of impairments taken on
investments; (27) the risk of litigation and regulatory inquiries
or investigations, and the risk of adverse outcomes in connection
therewith; (28) actions of stakeholders whose interests are not
aligned with broader interests of Ambac's stockholders; (29) system
security risks, data protection breaches and cyber attacks; (30)
regulatory oversight of Ambac Assurance UK Limited (“Ambac UK”) and
applicable regulatory restrictions may adversely affect our ability
to realize value from Ambac UK or the amount of value we ultimately
realize; (31) failures in services or products provided by third
parties; (32) our inability to attract and retain qualified
executives, senior managers and other employees, or the loss of
such personnel; (33) fluctuations in foreign currency exchange
rates; (34) failure to realize our business expansion plans or
failure of such plans to create value; (35) greater competition for
our specialty property & casualty program insurance business;
(36) loss or lowering of the AM Best rating for our property and
casualty insurance company subsidiaries; (37) disintermediation
within the insurance industry or greater competition that
negatively impacts our managing general agency/underwriting
business; (38) changes in law or in the functioning of the
healthcare market that impair the business model of our accident
and health managing general underwriter; and (39) other risks and
uncertainties that have not been identified at this time.
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version on businesswire.com: https://www.businesswire.com/news/home/20220831005280/en/
Investors: Charles J. Sebaski Managing Director, Investor
Relations (212) 208-3177 csebaski@ambac.com
Media: Kate Smith Director, Corporate Communications (212)
208-3452 ksmith@ambac.com
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