Insurance companies manage risk—their own risk. When it comes to insuring new-issue muni bonds, the only game in town is Assured Guaranty Ltd. They’re staring down the barrel of a ratings downgrade by Moody’s Investors Service. Risky muni-bond investing is about to get riskier.
Check out The Wall Street Journal’s For Muni Bonds, Less Assurance:
The last remaining insurer of new municipal-bond issues is bracing for a fall that could bring its industry to a new low—and possibly increase borrowing costs for some small local governments.
Moody’s Investors Service warned in late March that it might cut bond-insurer Assured Guaranty Ltd.’s AGO +0.08% credit rating to the single-A range from the current Aa3, which is three notches below the highest rating of triple-A.
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