Security Capital Assurance has reported a net loss of 96.8 million for the first quarter of 2008, compared with a net income of $37.3 million for the comparable quarter of 2007.
According to the company, the net loss for the quarter was primarily due to non-cash, unrealized mark-to-market losses of $187.2 million on financial guarantee obligations in credit derivative form.
For the period, the company reported an operating loss of $2.7 million, or $0.04 per common share, compared to operating income of $44.1 million, or $0.68 per common share for the same quarter of 2007.
Net premiums earned increased 50% in the quarter to $58.4 million compared to $38.9 million posted during the corresponding quarter of 2007. The increase earned was primarily due to a significant increase in refunding premiums.
Paul Giordano, president and CEO of Security Capital Assurance, said: The credit environment in the first quarter of 2008 continued to be very difficult. We are focused on trying to restructure our company. In the first quarter, we also took steps to realign our operating costs with our present situation of writing almost no new business.