All Eyes On How NY Will Treat FGIC Policyholders

Law360, New York (June 13, 2012, 8:45 PM EDT) -- As the New York Department of Financial Services moves toward a historic takeover of troubled bond insurer Financial Guaranty Insurance Co., the regulator faces intense pressure not to favor FGIC's municipal bond policyholders at the expense of its structured finance policyholders, experts say.

With FGIC's consent, DFS head Benjamin Lawsky petitioned a New York state court Monday for approval of a state-led rehabilitation of FGIC. If the court greenlights the takeover, it would be the first time New York has put a financial guaranty insurance company...
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