Ambac, the second-biggest bond insurer, yesterday lost its triple-A credit rating from Fitch Ratings, undermining its ability to attract business and dealing a blow to the billions of dollars of securities it guarantees.

Fitch cut the bond insurer's credit rating to double-A, citing a $1bn (£511m) capital shortfall caused by losses on mortgage-related bonds Ambac has guaranteed. Fitch did not rule out further downgrades, citing "significant uncertainty with respect to the company's franchise, business model and strategic direction".