MBIA, Ambac Higher After S&P Stands Behind AAA Ratings (MBI, ABK)

Shares of bond insurers MBIA Inc. (NYSE: MBI) and Ambac (NYSE: ABK) surged higher this afternoon after S&P stood behind their AAA ratings of the embattled companies.

S&P removed MBIA's AAA financial strength rating from CreditWatch. S&P affirmed Ambac's AAA rating rating, but kept the stock on CreditWatch negative.

S&P said the removal of MBIA from CreditWatch reflects the company's success in accessing $2.6 billion of additional claims-paying resources, which, in their view, is a strong statement of management's ability to address the concerns related to the capital adequacy of the company.

The affirmation of Ambac's AAA rating reflects the firms assessment of the scope of Ambac's capital-raising plans and the company's ability to implement those plans. They left the rating on CreditWatch with negative implication to reflect uncertainty surrounding the risk profile and capitalization plans for the reported new corporate structure being contemplated.

Shares of MBIA are up 14% and Ambac is up 6%.

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