Syncora Holdings has announced that its wholly owned, New York financial guarantee insurance subsidiary, Syncora Guarantee, has settled its RMBS-related claims with JPMorgan and affiliates thereof.
In return for releases of all of the Company’s claims against JPMorgan and certain affiliates arising from certain insured RMBS transactions that were the subject of litigation or dispute, the Company is to receive a cash settlement.
In addition, and unrelated to the foregoing, since the posting of the Company’s third quarter 2013 statutory financial statements, the Company has remediated its exposure to several material financial guarantee insurance policies.
As a result of multiple substantial remediation transactions and litigation recoveries, the Company expects, in its 2013 annual statutory financial statements, to remove its disclosure regarding substantial doubt about the Company’s ability to continue as a going concern over the next twelve months.
Thereafter, and especially beginning from 2017, the Company continues to face a potential "liquidity mismatch" between expected claim payments in the earlier years, followed in later years by recoveries of these claims payments.
The combined effect of the remediations and settlement is expected to have a materially positive effect on the Company’s policyholder surplus that will be reflected in its 2013 annual statutory financial statements, which the Company expects to issue on or about February 28, 2014.
Despite these developments and the change in the going concern assessment, the Company continues to face significant risks and uncertainties as described in the Company’s financial statements.