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Ambac rescue may be announced Mon or Tues-source
Fri Feb 22, 2008 4:02pm EST

NEW YORK, Feb 22 (Reuters) - A rescue for bond insurer Ambac Financial Group Inc (ABK.N: Quote, Profile, Research) may be announced on Monday or Tuesday, a person familiar with the matter said on Friday.

Ambac, the second-largest bond insurer in the United States, is facing billions of dollars of expected losses after guaranteeing bonds linked to subprime debt and other risky assets.

Banks working with Ambac include Barclays Plc (BARC.L: Quote, Profile, Research), BNP Paribas (BNPP.PA: Quote, Profile, Research), Citigroup Inc (C.N: Quote, Profile, Research), Allianz's (ALVG.DE: Quote, Profile, Research) Dresdner Bank, Royal Bank of Scotland Group Plc (RBS.L: Quote, Profile, Research), Societe Generale (SOGN.PA: Quote, Profile, Research), UBS AG (UBSN.VX: Quote, Profile, Research) and Wachovia Corp (WB.N: Quote, Profile, Research). Progress has been made in recent days but a deal may still fall through. The potential deal was first reported by U.S. financial television network CNBC. (Reporting by Dan Wilchins, editing by Leslie Gevirtz)