90 at 9, Tuesday February 19, 2008

Welcome to interest.co.nz’s morning briefing of what’s news here and around the world. Everything you need to start the day in 90 seconds at 9’oclock…. Starting now
With news from Australia that ANZ Banking group has revealed a US0 million exposure to a bond insurance deal that has gone sour. This is all about the so-called monoline bond insurance crisis I’ve been briefing you on for weeks. Now its finally hit investors closer to home.
ANZ Banking Group owns both ANZ and National Bank in New Zealand and, like the other banks, had been thought to have been immune from the direct fallout from the global credit crunch.
The news shocked investors, who immediately wiped off 6% from the value of ANZ.
Elsewhere in credit crunch news, the Wall St Journal is reporting that Ambac, the second biggest monoline bond insurer, is planning to break itself up into a safe insurer of local government bonds and a not-so-safe insurer of complicated credit derivatives. This is more bad news for the global banking industry because it means banks still holding the complicated credit derivatives, such as ANZ, will have to downgrade their value as soon as the ‘less safe’ part of Ambac is given a bad credit rating.
And finally, the General Electric, which owns GE Money and Wizard here, is reported to be in negotiations to buy some assets of Australia’s Allco Finance Group. You might remember that Allco owns a controlling stake in Strategic Finance, although Strategic has said it has had no indication it is for sale or would be sold.
That was 90 seconds at 9 o’clock. I’m Bernard Hickey for interest.co.nz