Financial Security Assurance has started to review synthetic collateralized debt obligations again with an eye to reentering the guarantee market. Betsy Castenir, spokeswoman in New York, said the FSA is pursuing new business in the CDO market selectively, but declined further comment. The monoline pulled out of writing guarantees on CDOs last year, after sustaining losses, said market officials.
Credit Investors said they were not surprised to see FSA return to the arena, but said the firm is likely to proceed cautiously and increase its scrutiny of deals.
