ABK Ambac Financial Grp. Common Stock

Transport for London (�TfL�) yesterday announced the intention of its subsidiary, London Underground Ltd (�LUL�), to pay the put option price on senior debt of Metronet Rail BCV (�BCV�) and Metronet Rail SSL (�SSL�), including index-linked and fixed-rate senior secured bonds insured by AUK. AUK insures �193 million of the SSL indexed-linked notes and �350 million of the BCV notes. The debt was issued under Public Private Partnership (�PPP�) contracts to finance the operation, maintenance and the initial phase of asset upgrades for part of the London Underground. Under the applicable PPP contracts, insured debt holders and other senior creditors benefit from an �Underpinned Amount� providing support from LUL. TfL announced yesterday that approximately �1.74 billion will be paid on account of this obligation. AUK will segregate the portion of LUL�s payment relating to the AUK-insured bond financing, while it explores options permitted by the transaction documents to apply put option proceeds against obligations due to bondholders. In the meantime, the segregated amount will be available to meet debt service guaranteed by AUK and other amounts in accordance with the documentation. AUK�s unconditional and irrevocable guarantee remains in full force and effect. Forward-Looking Statements This release contains statements about our future results that may constitute �forward-looking statements� within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management�s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements due to a variety of factors. More information about these factors is contained in Ambac Financial Group Inc.�s (ultimate parent company to AUK) (�Ambac�) filings with the Securities and Exchange Commission. There are a variety of factors, many of which are beyond Ambac�s control, which affect the operations, performance, business strategy and results and could cause its actual results to differ materially from the expectations and objectives expressed in any forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements which speak only as of the date they are made. Ambac does not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the date the forward-looking statements are made. The reader should, however, consult any further disclosures Ambac may make in its future filings of its reports on Form 10-K, Form 10-Q and Form 8-K. Ambac Financial Group, Inc., headquartered in New York City, is a holding company whose affiliates provide financial guarantees and financial services to clients in both the public and private sectors around the world. Ambac�s principal operating subsidiary, Ambac Assurance Corporation, a leading guarantor of public finance and structured finance obligations, has earned triple-A ratings from Moody�s Investors Service, Inc. and Standard & Poor�s Ratings Services; and a double-A rating from Fitch, Inc. Moody�s has placed Ambac�s triple-A rating on review for possible downgrade. Standard & Poor�s has placed Ambac�s triple-A rating on �credit watch negative.� Fitch has placed Ambac's double-A rating on �rating watch negative.� Ambac Financial Group, Inc. common stock is listed on the New York Stock Exchange (ticker symbol ABK).