Principal Discloses $1B in Exposures

The Principal Financial Group, Des Moines, Iowa, has disclosed in a Securities and Exchange Commission filling that as of Dec. 31 it had $996.5 million of exposures to monoline bond insurers and mortgage insurers. In other news related to pressures on insurers from the mortgage-related credit crunch, California Treasurer Bill Lockyer has asked Fitch Ratings, Moody's Investors Service, and Standard & Poor's Ratings Services to create a new rating standard for municipal debt, citing issues highlighted by the crunch's effect on bond insurers and their ratings. None of the three rating agencies had a comment on the issue as of late Wednesday morning. Meanwhile, multiple reports indicated that closely watched billionaire Warren Buffett has withdrawn an offer to reinsure three financial guarantors' positions in $800 billion of municipal bonds because the companies had not been receptive to the offer.