NEW YORK (Bloomberg) - Ambac Financial Group Inc. will terminate its contract with Fitch Ratings, becoming the fourth bond insurer to reject the ratings company after it sliced their rankings.

The second-largest bond insurer is reevaluating its ratings needs as it realigns its business, New York-based Ambac said today in a statement. "As part of this review, we have asked Fitch to remove its ratings on Ambac and all its subsidiaries effective immediately," the company said.

Ambac's request follows one by larger rival MBIA Inc., which in March asked Fitch to stop providing a financial strength rating on its insurance unit. In September, Radian Group Inc., which owns mortgage and financial guaranty companies, asked Fitch to stop issuing ratings and said it would no longer provide information to the unit of Paris-based Fimalac SA.

Fitch, which said in a statement that it's "considering the request" from Ambac, stripped the company of its AAA bond insurance rating in January, after it abandoned plans to raise new equity. Top credit ratings at bond insurers have been under scrutiny since last year as losses surged on securities they guaranteed backed by home loans.

The guarantors stumbled as they strayed from backing municipal debt, which rarely defaults, to guaranteeing securities such as collateralized debt obligations, which package pools of securities, including those backed by sub-prime mortgages, and slice them into pieces of varying risk.

Standard & Poor's followed Fitch this month in cutting MBIA and Ambac, reducing the ratings of their insurance units to AA from AAA, and citing a decline in new business for the downgrade. Moody's Investors Service said it's likely to downgrade the two companies' Aaa ratings. MBIA, the largest bond insurer, is based in Armonk, New York.

Ambac seeks "to kind of silence some of the stronger critics of the company," Rob Haines, an analyst with independent research firm CreditSights Inc. in New York, said in an interview on Bloomberg Television. "Fitch has been out in front of S&P and Moody's throughout this crisis."

CIFG Holding Ltd., which owns several financial guaranty companies, said in March it had asked Fitch to stop evaluating its strength.

"CIFG believes achieving higher ratings with Fitch would be impeded by the limitations of that agency's approach to rating financial guaranty companies," according to a March 31 statement from the Hamilton, Bermuda-based company.

Fitch continued to rate Radian of Philadelphia until May when it announced that it no longer had enough information to provide a credible rating.

Fitch is unlikely to withdraw its ratings on Ambac, Mr. Haines said.

"It's valuable to Fitch's clients to maintain the rating," he said.