Ambac Financial Group has terminated a $400 million credit line because it was not in shareholders' best interest, reports Reuters.

The second-largest bond insurer in the world said that as of August 6, it was in violation of certain net asset covenants in the credit agreement and that its management has determined that the terms weren't in the best interest of shareholders and needed to be changed.

The five-year unsecured, committed revolving credit facility was due to expire on July 30, 2012. Ambac added the credit agreement enabled Ambac to borrow for general corporate purposes.

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