CNBC reports ABK bailout plan in the works
UPDATE: More from the FT ...
"A group of banks is preparing to inject $2bn to $3bn into the troubled bond insurer Ambac, which is racing against time to come up with fresh capital to avoid a sharp cut in its triple-A credit rating that could trigger wider financial market turmoil.
"The money from the banks would be part of a plan to split Ambac’s operations, people involved in the discussions said.
"Ambac is also considering raising fresh equity from shareholders. It is not clear how much capital it will need, or what credit ratings the split businesses would have."