Exhibit 4.04

                            CERTIFICATE OF AMENDMENT

                                     TO THE

               AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

                                       OF

                          AMBAC FINANCIAL GROUP, INC.

     Ambac Financial Group, Inc., a Delaware corporation (the "CORPORATION"),
hereby certifies to the Secretary of State of the State of Delaware as follows:

        1. The name of the Corporation is Ambac Financial Group, Inc. and its
Amended and Restated Certificate of Incorporation was filed with the Secretary
of State on July 11, 1997.
 
        2. Section 4.1 of Article IV of the Corporation's Amended and Restated
Certificate of Incorporation is hereby amended in its entirety to read as
follows:

          Section 4.1.  AUTHORIZED CAPITAL.  The total number of shares of all
          classes of stock that the Corporation shall have authority to issue is
          204,000,000, consisting of 200,000,000 shares of common stock, par
          value $.01 per share (the "COMMON STOCK") and 4,000,000 shares of
          preferred stock, par value $.01 per share (the "PREFERRED STOCK").


        3. The foregoing amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.

 
     IN WITNESS WHEREOF, Ambac Financial Group, Inc. has caused this Certificate
to be duly executed on this 13th day of May, 1998 in its corporate name and on
its behalf by the Chairman, President and Chief Executive Officer and attested
by its Secretary, pursuant to Section 103(a) of the General Corporation Law of
the State of Delaware.

                                      /s/ Phillip B. Lassiter
                                      -----------------------
                                      Phillip B. Lassiter
                                      Chairman, President and
                                      Chief Executive Officer

ATTEST: /s/ Richard B. Gross
        --------------------
        Richard B. Gross
        Secretary

Dated:  May 13, 1998