MBIA - AMBAC International Announces Strategic Alliance with The Yasuda Fire and Marine Insurance Co., Ltd. and Mitsui Marine and Fire Insurance Co., Ltd. to Provide Financial Guarantee Insurance in Japan.NEW YORK--(BUSINESS WIRE)--Sept. 3, 1998-- New Tokyo Office Established MBIA MBIA Montana Building Industry Association MBIA Municipal Bond Insurance Association MBIA Michigan Boating Industries Association MBIA Municipal Bond Investors Assurance MBIA Massachusetts Brain Injury Association MBIA Maryland Business Incubation Association - AMBAC AMBAC American Municipal Bond Assurance Corporation AMBAC Active Mass Balance Auto-Control (Gundam anime) International, the reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. joint venture between the world's two largest monoline financial guarantors, Ambac Assurance Corporation Ambac Assurance Corporation A subsidiary of publicly traded Ambac Financial Group that provides financial guarantees for municipal borrowers and for asset-backed and structured issues. (NYSE NYSE See: New York Stock Exchange :ABK ABK Abkuerzung (German: Abbreviation) ABK Anybody Killa (musician) ABK Ahli Bank of Kuwait ABK American Bank of Kosovo ABK Aphakic Bullous Keratopathy (ophthalmology) ) and MBIA Insurance Corporation (NYSE:MBI MBI Management Buy-In MBI Moody Bible Institute MBI Mathematical Biosciences Institute MBI Modular Building Institute MBI Mechanical Breakdown Insurance MBI Molecular Biology Institute MBI Maslach Burnout Inventory (psychometrics) ) has announced its intent to form a strategic alliance with two of Japan's largest non-life insurance companies, Mitsui Marine and Fire Insurance Co. Ltd. and The Yasuda Fire and Marine Insurance Co. Ltd. The alliance will provide financial guarantee insurance to Japanese issuer and investor clients. It is expected that a letter of intent will be signed within the next few months. To support this effort, MBIA - AMBAC International has opened a representative office in Tokyo. "We are particularly pleased to have such strong partners in Yasuda and Mitsui," says Ambac's Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , Phillip B. Lassiter. "Their reputation and longstanding relationships complement the financial strength and technical expertise of MBIA - AMBAC International." "The alliance strengthens MBIA - AMBAC International's commitment to Japan by providing increased underwriting capacity, high ratings and innovative structured finance technology at a critical juncture in the changing Japanese credit markets," remarks David H. Elliott, MBIA chairman and CEO. Ambac and MBIA pioneered the U.S. financial guarantee industry in the 1970s, and today both are leaders in the field with a combined total of over $500 billion of par value of insured securities outstanding and combined claims-paying resources of over $10 billion. In 1995, the two companies formed a joint venture, MBIA - AMBAC International, and helped introduce financial guarantee insurance to world markets. From Japan alone, Ambac and MBIA have insured $6.4 billion in par value of asset-backed and structured transactions. Ambac and MBIA have existing relationships with Yasuda and Mitsui and have previously cooperated on reinsurance transactions. The new alliance would combine the experience and capacity of MBIA - AMBAC International with the capabilities of Yasuda and Mitsui to provide financial guarantees in the domestic Japanese market. The new Tokyo office of MBIA - AMBAC International will be managed by John Bryan and Stephen Halpert, both managing directors of MBIA - AMBAC International. Mr. Bryan and Mr. Halpert each have over 20 years of experience in Japan and have overseen the Japan activities of Ambac and MBIA over the past four years. "While there are significant changes taking place in Japan, we clearly expect appropriate opportunities that meet our traditional investment grade standards," says Mr. Bryan. "This is particularly true in the case of asset-backed and structured finance transactions," adds Mr. Halpert. Financial guarantee insurance provides for timely payment to investors of principal and interest in the event of a default, and the securities carry the underlying financial strength rating of the guarantor. Issuers gain improved access to domestic and international capital markets, lower cost of funds Cost of Funds The interest rate paid on an outstanding loan. Notes: Money isn't free! Cost of funds is the cost of borrowing money. See also: Interest Rate Cost of funds Interest rate associated with borrowing money. and diversified funding sources. Investors gain the safety of highly rated securities, broadened portfolio diversification and mitigation of risk by purchasing insured securities. Ambac Assurance Corporation and MBIA Insurance Corporation have financial strength ratings of Triple-A by Moody's Investors Service Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. , Inc., Standard & Poor's Ratings Services, Fitch IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals , Inc. and Japan Rating and Investment Information, Inc. The Yasuda Fire & Marine Insurance Co. Ltd. and Mitsui Marine & Fire Insurance Co. Ltd. are the second and third largest non-life insurance companies in Japan, respectively. With Double-A ratings from Moody's and Standard & Poor's, both property and casualty insurers hold strong market positions, have conservative capitalization, excellent financial flexibility and are well positioned to take advantage of opportunities arising from market deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. . MBIA - AMBAC International is an unincorporated reinsurance joint venture among Ambac Assurance Corporation, Ambac Insurance UK Limited, MBIA Insurance Corporation and MBIA Assurance S.A. MBIA - AMBAC International is not a partnership. Financial guarantee insurance policies are issued separately by the joint venture companies.
CONTACT: MBIA Insurance Corp., Armonk
Debra A. Descloux, 914/765 3895
or Michael C. Ballinger, 914/765 3893
www.mbia-ambac.com
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