The first-ever mutual municipal bond insurer launched on Monday, with an endorsement from the National League of Cities and a goal of bringing competition back to a once huge market that nearly collapsed after the credit crisis.
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The new venture will compete with Assured Guaranty, which is effectively the only bond insurer still writing new business in the United States.The once-robust business was all but crippled by the financial crisis, as bond insurers that strayed from their municipal routes into structured finance were slammed by losses.
While insured bonds accounted for more than half of the market in 2005, just 4 percent of muni issues were insured in the first half of 2012, though S&P on Monday estimated that could ultimately rise to 30 percent or more.
Read more at http://in.reuters.com/article/2012/07/23/insurance-munibonds-newyork-idINL2E8INDQM20120723