Ambac Financial Group said that the Wisconsin Office of the Commissioner of Insurance (OCI) has filed its Plan of Rehabilitation for the Segregated Account of Ambac Assurance Corp. in Dane County Circuit Court in Wisconsin.
Ambac's segregated account was established on March 24, at the direction of the OCI to segregate certain liabilities, mostly policies related to credit derivatives, RMBS and other structured finance deals.
These policies total around $57.6 billion of net par outstanding as of June 30 and have been allocated to the segregated account.
Before the OCI's plan can become effective, it must be confirmed in Wisconsin courts. The OCI expects that the court will schedule a hearing shortly to consider the plan's confirmation. Claims on the segregated account policies are subject to a payment moratorium until the plan becomes effective.
The plan says that, upon its effectivity, holders of permitted policy claims will get 25% of their permitted claims in cash and 75% in surplus notes with a scheduled June 7, 2020 maturity and bearing a 5.1% interest.