Ambac, the world's second-biggest bond insurer, yesterday lost its crucial triple-A credit rating from Fitch RatingS, undermining its ability to add new business and dealing a blow to the billions of dollars of securities it has guaranteed.

Rating agency Fitch cut the bond insurer's credit rating to double-A, citing a $1bn capital shortfall caused by losses on mortgagerelated 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".