Syncora Holdings Ltd. (fka SYCRF)

[rockraider3]

On the Liquidity Mismatch and Reliance Rail:

In past quarters, we have talked about our liquidity mismatch which includes credit that face refinancing risks due to a variety of factors including the underlying credit, market conditions for the transaction structure.

The largest of those credits is Reliance Rail and we continue to aggressively pursue our remediation plan for Reliance Rail with the goal of facilitating the successful refinancing while credit markets are strong. The New South Wales government has recently begun a process to engage a financial advisor to assist in the refinancing process. We view this as a positive indication that the New South Wales government is determined to progress at timely refinance of the project. However, as we have said before, this is complicated credit with potential execution risk and uncertainty remains as the timing for completion of refinancing.

Financial advisers and legal counsel in Australia have advised that should Reliance Rail fail to refinance Syncora would retain the ability to proactively remediate the exposure.