UPDATE 1-Syncora says looking at strategic alternatives

(Adds background, details)

NEW YORK, Oct 1 (Reuters) - Troubled bond insurer Syncora Holdings Ltd SCA.N said on Wednesday it hired J.P. Morgan to examine strategic alternatives for its porfolio of credit default swaps and financial guarantee contracts.

Syncora's former parent company XL Capital Ltd (XL.N) essentially severed its ties with the bond insurer, formerly called Security Capital Assurance Ltd, after it was pushed to the brink of insolvency by the credit crunch.

Last month, Fitch Ratings said it had withdrawn the ratings of Syncora, saying it was effectively closed to new business.

Syncora said JPMorgan Chase & Co (JPM.N) would help it identify and analyze the insurer's exposures to credit default swaps and financial guarantee contracts the bond insurer is trying to renegotiate with 17 different bank counterparties.

In July, the former Security Capital reached an agreement with Merrill Lynch & Co Inc MER.N to cancel $3.5 billion in credit default swaps and end litigation in exchange for a $500 million payment to Merrill. (Reporting by Christian Plumb; Editing by Andre Grenon)