Fitch withdraws ratings on bond insurer Syncora

NEW YORK, Sept 5 (Reuters) - Fitch Ratings said on Friday it has withdrawn the ratings of bond insurer Syncora Holdings Ltd (SCA.N: Quote, Profile, Research, Stock Buzz), formerly known as Security Capital Assurance.

The ratings firm said it believed Syncora was "effectively in run-off," or closed to new business.

It also took the action after Syncora indicated it will no longer provide Fitch with non-public information needed to maintain the ratings, according to the rating agency's statement.

Fitch last month put Syncora's ratings on positive watch, indicating an upgrade was possible, after it was able to reach financial settlements with Merrill Lynch & Co (MER.N: Quote, Profile, Research, Stock Buzz) and insurer XL Capital (XL.N: Quote, Profile, Research, Stock Buzz), which had been its largest shareholder.

On March 13 Syncora said it was no longer writing new business after posting a fourth-quarter loss of $1.2 billion.

Syncora could not be reached immediately for comment.

Under the agreement with Merrill, Syncora was released from derivatives guarantees, and litigation between the two parties was ended. It also got a capital boost after XL Capital agreed to pay it $1.78 billion in exchange for being able to escape a contractual agreement to bear some liability for losses on contracts written before SCA's initial public offering more than two years ago. (Reporting by Lilla Zuill; editing by Carol Bishopric)