Ambac Ends Contract With Fitch

Ambac Financial Group Inc., a bond insurer that has been pressured by its past exposure to mortgage debt securities hard-hit by the recent market crisis, has decided to terminate its ratings contract with Fitch and asked Fitch to withdraw its ratings. Fitch said it will consider the request. "Our decision to refocus and realign our business around our core expertise in the public finance and infrastructure sectors has led us to re-evaluate our ratings needs," Ambac said. Both Ambac and fellow bond insurer MBIA have been battling negative rating actions by Fitch and other rating agencies, which in turn are under political pressure to show that their ratings sufficiently reflect credit risks and are not compromised by rated companies' payments for services. Bond insurers' ratings are a focal point for the market because of their potential ripple effects on the debt securities they insure.