FSA´s Statement Regarding Expiration of Confidentiality Agreements with Certain Holders of Bonds Issued by Metronet Rail BCV & Metronet Rail SSL

Financial Security Assurance (FSA) announced the expiration, as of

today, of confidentiality agreements between certain holders of bonds ("Participating

Bondholders") issued by Metronet Rail BCV

(BCV) and Metronet Rail SSL (SSL) and FSA and Ambac Assurance UK Limited

(the "Monolines").
As previously announced on February 13, 2008, funds paid by London

Underground Ltd (LUL) in respect of the put option price on bonds issued

by BCV and SSL are being held in escrow and are available to meet debt

service and other amounts due in accordance with the Bond Trust Deed

escrow agreements and other relevant documentation.
Triple-A rated FSA insures £193 million gross

(£93 million net of amounts reinsured) of

index-linked bonds issued by BCV and £350

million gross (£170 million net of amounts

reinsured) of fixed-rate bonds issued by SSL. The BCV bonds are indexed

every six months, which affects the gross and net amounts. The debt was

issued under Public Private Partnership (PPP) contracts to finance the

operation, maintenance and the initial phase of asset upgrades for part

of the London Underground.
Under the applicable PPP contracts, insured bondholders and other senior

creditors including commercial banks and the EIB benefit from an "Underpinned

Amount" providing support from LUL. With

respect to the FSA-insured BCV and SSL bonds, the sum of £619

million has been segregated through deposit into two separate escrow

accounts opened in the joint names of FSA and Deutsche Trustee Company

Limited (Deutsche) at Citibank, N.A., London Branch. Deutsche is the

Bond Trustee under the Bond Trust Deed governing the BCV and SSL bonds.
Within the confidentiality arrangements, the Participating Bondholders

and the Monolines discussed various options relating to the application

of funds currently standing to the credit of the escrow accounts

relating to the bonds (the "Escrow Amounts").
The documentation relating to the bonds does not clearly set out how the

Escrow Amounts should be applied. Escrow Amounts are currently being

used to pay scheduled interest and principal. The Monolines and the

Participating Bondholders have been discussing other possible

applications of the Escrow Amounts, including: 1.) collateral management

(purchase of a suitable investment portfolio); or 2.) a tender offer; or

3.) acceleration of the Bonds at par.
These discussions have not yet reached a conclusion. The Monolines will

continue to work towards a decision regarding the application of the

Escrow Amounts.
The funds held in escrow are available to meet debt service guaranteed

by FSA and other amounts due in accordance with the Bond Trust Deed, the

escrow agreement and other relevant documentation. While in escrow, the

funds will be invested in UK government securities, entities which

invest solely in UK government securities, any short term instruments or

deposits with a rating of A-1 or better by S&P and P-1 or better by Moody´s

or other investments as agreed by FSA and the Bond Trustee.
As is typical for insured transactions that experience an event of

default, FSA has the right to direct that the funds held in escrow be

used either to continue to meet debt service as scheduled or to fund the

acceleration and immediate payment of all principal and interest due.
FSA´s unconditional and irrevocable Triple-A

guaranty remains in full force and effect.
THE COMPANY
Financial Security Assurance Holdings Ltd. (the Company), headquartered

in New York City, is a holding company whose affiliates provide

financial guarantees and financial products to clients in both the

public and private sectors around the world. The principal operating

subsidiary, Financial Security Assurance Inc. (FSA), a leading guarantor

of public finance and asset-backed obligations, has been assigned

Triple-A ratings, the highest ratings available, from Fitch Ratings

Moody´s Investors Service, Inc., Standard &

Poor´s Ratings Services and Rating and

Investment Information, Inc. Through other subsidiaries, the Company

provides FSA-insured financial products, such as guaranteed investment

contracts, to obtain funds at Triple-A cost and then invests those funds

in high-quality, liquid securities. The Company is a member of the Dexia

group.
FORWARD-LOOKING STATEMENTS
The Company relies on the safe harbor for forward-looking statements

provided by the Private Securities Litigation Reform Act of 1995. This

safe harbor requires that the Company specify important factors that

could cause actual results to differ materially from those contained in

forward-looking statements made by or on behalf of the Company.

Accordingly, forward-looking statements by the Company and its

affiliates are qualified by reference to the following cautionary

statements.
In its filings with the SEC, reports to shareholders, press releases and

other written and oral communications, the Company from time to time

makes forward-looking statements. Such forward-looking statements

include, but are not limited to:

projections of revenues, income (or loss), earnings (or loss) per

share, dividends, market share or other financial forecasts;

statements of plans, objectives or goals of the Company or its

management, including those related to growth in adjusted book value

or return on equity; and

expected losses on, and adequacy of loss reserves for, insured

transactions.

Words such as "believes," "anticipates," "expects," "intends" and "plans" and future and conditional verbs such as "will," "should," "would," "could" and "may" and similar expressions are intended to identify forward-looking

statements but are not the exclusive means of identifying such

statements.
The Company cautions that a number of important factors could cause

actual results to differ materially from the plans, objectives

expectations, estimates and intentions expressed in forward-looking

statements made by the Company. These factors include:

changes in capital requirements or other criteria of securities rating

agencies applicable to FSA;

competitive forces, including the conduct of other financial guaranty

insurers;

changes in domestic or foreign laws or regulations applicable to the

Company, its competitors or its clients;

changes in accounting principles or practices that may result in a

decline in securitization transactions or affect the Company´s

reported financial results;

an economic downturn or other economic conditions (such as a rising

interest rate environment) adversely affecting transactions insured by

FSA or its investment portfolio;

inadequacy of reserves established by the Company for losses and loss

adjustment expenses;

disruptions in cash flow on FSA-insured structured transactions

attributable to legal challenges to such structures;

downgrade or default of one or more of FSA´s reinsurers;

market conditions, including the credit quality and market pricing of

securities issued;

capacity limitations that may impair investor appetite for FSA-insured

obligations;

market spreads and pricing on insured CDS exposures, which may result

in gain or loss due to mark-to-market accounting requirements;

prepayment speeds on FSA-insured asset-backed securities and other

factors that may influence the amount of installment premiums paid to

FSA; and

other factors, most of which are beyond the Company´s

control.

The Company cautions that the foregoing list of important factors is not

exhaustive. In any event, such forward-looking statements made by the

Company speak only as of the date on which they are made, and the

Company does not undertake any obligation to update or revise such

statements as a result of new information, future events or otherwise.