by Calculated Risk on 2/06/2008 11:27:00 PM

From Bloomberg: MBIA to Raise Additional $750 Million of Capital

MBIA ... plans to raise an additional $750 million by selling about 50.3 million common shares, bolstering capital in an attempt to retain its AAA credit rating.
...
``The most significant fact is that they're raising the amount of capital from what they previously announced,'' Wilbur Ross, an investor in distressed companies, said in an interview with Bloomberg TV. ``I would be astonished if they hadn't consulted with the rating agencies before they made this announcement,' he said, adding that MBIA may retain its AAA.

And from the WSJ: Rescue Plans Won't Prevent Downgrades

... some banks and investors working toward salvaging the bond insurers ... are realizing that even the best plans could require them to settle for less -- less risk, less reward and bond insurers with less-than-triple-A ratings in the future ...

The banks are trying to figure out how to commute, or unwind, their credit-default swaps, which are contracts they entered into with ... bond insurers to guarantee their portfolios of complex debt securities known as collateralized-debt obligations, or CDOs ... In exchange for unwinding the contracts, FGIC and Ambac could give the banks stakes in their companies through warrants ...

The banks, then, would share in the proceeds that the bond insurers would make as they collect premiums and wait for their existing portfolio of policies to expire, or "run off." In this scenario, the most the banks are hoping for is that the bond insurers' credit ratings don't fall below double-A ...

If some of the recent loss estimates are even remotely correct, these are just delaying tactics.