Moody’s Announces Rating Actions on Guarantors; FGIC, XL Capital Face Downgrades

Completing a well-publicized review of financial guaranty companies, Moody’s Investors Service said Friday that both Financial Guaranty Insurance Company and XL Capital Assurance Inc. were placed on review for possible downgrade, with Moody’s citing concerns over a lack of capital adequacy to maintain an ‘Aaa’ rating at both firms.

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As a result of these reviews, Moody’s said that securities wrapped by FGIC and XL Capital Assurance are also under review for possible downgrades.