(Reuters) - Australia's Insignia Financial ( IOOFF ) said on Wednesday that Bain Capital has pulled its buyout offer due to volatile financial markets, but the money manager added it was still in talks with another suitor, investment manager CC Capital.

Private equity firm Bain's proposal valued Insignia at A$3.34 billion ($2.2 billion), the same as CC Capital's raised bid in March.

At that time, a third suitor, Brookfield Asset Management ( BAM ) did not raise its offer, and media reports have since said the New York-based private equity firm had walked away.

Insignia's shares sank 15.8% to end the day at A$3.37, below Bain's and CC Capital's offer of A$5 per share. That indicates investors expect CC Capital, likely the last remaining suitor, to either lower its offer or also pull out.

"I have long thought that there would be one man standing ...and a renegotiated price. The market clearly believes that CC Capital will pull out too," said Henry Jennings, senior market analyst at Marcustoday.

Jennings said he now expects a formal offer, if any, to be below his earlier estimate of A$4.60 per Insignia share, which was the value of Bain's and CC Capital's offers before they raised it once Brookfield entered the fray.

While Insignia said it was in talks with CC Capital regarding a binding offer, it gave no further details.

CC Capital did not immediately respond to a Reuters email seeking comment. Brookfield declined to comment.

Shaun Ler, equity analyst at Morningstar, said it was equally likely that CC Capital would make a formal offer or withdraw. Ler estimates Insignia's fair value is A$3.90 a share.

Tanarra Capital, which holds a roughly 14% stake in Insignia, had said it would support any offer valuing the company at A$5 per share. It did not respond to an email seeking comment on the latest development. ($1 = A$1.5458)