Ambac Financial Group, Inc. Announces First
Quarter 2010 Results
May 18, 2010 08:03 AM Eastern Daylight Time
NEW YORK--(EON: Enhanced Online News)--Ambac Financial Group, Inc. (NYSE: ABK) (Ambac) today
announced first quarter 2010 net loss of $690.1 million, or net loss of $2.39 per share. This compares to a first
quarter 2009 net loss of $392.2 million, or net loss of $1.36 per share. The first quarter 2010 results reflect a loss
reported as a result of a new consolidations accounting standard. In 2009, Ambac’s first quarter results reflected a
large positive change in fair value of credit derivatives offset by loss and loss adjustment expenses primarily related to
residential mortgage-backed securities (RMBS) exposure, other than temporary impairment write downs of RMBS
securities in the investment portfolios and a $600 million increase in the deferred tax asset valuation allowance.
First Quarter 2010 Summary
l Recorded a $495.1 million loss related to the new consolidations accounting standard as described under
“Implementation of New Accounting Standards,” below. The loss is considered to be non-recurring as it
results from the deconsolidation of a number of variable interest entities. Excluding the effect of this non-
recurring item, Ambac would have reported a net loss of $195.0 million, or net loss of $0.68 per share.
l Net change in fair value of credit derivatives was negative $167.1 million.
l Net loss and loss expenses incurred amounted to $89.2 million for the current quarter, down considerably
from the first quarter of 2009.
l Statutory surplus of Ambac Assurance Corporation (“AAC”) was reduced to approximately $160 million at
March 31, 2010 from $801.9 million at December 31, 2009.
Implementation of New Accounting Standards
Effective January 1, 2010, Ambac adopted Accounting Standards Update No. (“ASU”) 2009-17, “Consolidations
(Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities”.
ASU 2009-17 r