Syncora HoldingsLtd. unit Syncora GuaranteeInc. has settled a dispute with an originator of RMBS in relation toan insured RMBS-related transaction that was not the subject of litigation, in returnfor a cash payment of $40 million.

The settlement is expected to increase Syncora Holdings' GAAPnet income and shareholders' equity by $40 million. It is projected to have thesame effect on Syncora Guarantee's statutory-basis net income and policyholders'surplus.