Ambac Financial posts $392M loss in 1st quarter

Bond insurer Ambac Financial Group Inc. said Monday it lost $392.2 million in the first quarter, a narrower loss than the year before, in part due to a rise in value in credit derivatives.

Ambac lost $1.36 per share in the quarter that ended March 31. That compares to a loss of $1.66 billion, or $11.69 per share, a year earlier.

Analysts polled by Thomson Reuters had expected a loss of 93 cents per share.

Revenue moved into positive territory to $1.13 billion, improved from year-earlier negative revenue of $1.66 billion. Negative revenue usually occurs when a company is forced to reverse gains it recorded as revenue in an earlier period.

Net premiums earned rose 5 percent to $196.8 million.

Like others in its industry, Ambac was hit hard in the past two years by losses on its coverage of risky financial instruments such as mortgage-backed securities and has been working to reduce its exposure to such debt instruments.

Ambac said its quarterly results included $279.7 million in pretax income from a rise in the value of credit derivatives.

During the quarter Ambac increased its deferred tax asset valuation allowance by about $600 million.

In morning trading, Ambac shares rose 21 cents, or 13 percent, to $1.82.