Banks--- Betting on the recovery Message Board

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Non-Tech : Banks--- Betting on the recovery

WFC 84.71

-1.8%

3:59 PM EST

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To: David C. Burns who wrote (523)	5/15/2009 1:13:16 AM
From: Hawkmoon	of 1428

Yeah.. that was an interesting move by the banks. They commit insurance fraud by misrepresenting the assets they asked to be insured and now they are suing MBIA for trying to restart their insurance business. From MBI's perspective, as I see it, they are fairly certain that the courts are going to uphold their assertions that they have no liability to pay out claims on these fraudulently originated assets so they shouldn't have to set aside reserves to cover such liabilities. ABK seems to be taking a different tack by trying to raise $1 Billion to capitalize their Everspan subsidiary, but are obviously having difficulty raising capital in the current markets. Not a lawyer, but I see this as a pre-emptive strike by the banks in anticipation of the pending litigation. Hawk

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