S&P Affirms Assured Guaranty’s AA Financial Strength Ratings with Stable Outlook

New Report Highlights Assured Guaranty’s Very Strong Capital and the Proven Track Record of Its Well-Established Business Model


Monday, July 6, 2015 10:34 am EDT



Public Company Information:

"and concluded there would be no change in Assured Guaranty’s capital adequacy score based solely on such defaults. S&P noted that if Assured Guaranty pays any claims, the payments would be made over time based on each insured issue’s payment schedule."

HAMILTON, Bermuda--(BUSINESS WIRE)--In a June 29 rating report on Assured Guaranty Ltd. (NYSE:AGO) and its operating subsidiaries (collectively, Assured Guaranty), Standard & Poor’s Ratings Services (S&P) affirmed the AA Stable Outlook financial strength ratings of U.S. bond insurers Assured Guaranty Municipal Corp. (AGM), Municipal Assurance Corp. (MAC) and Assured Guaranty Corp. (AGC); European financial guarantor Assured Guaranty (Europe) Ltd. (AGE); and reinsurer Assured Guaranty Re Ltd. (AG Re). The AA rating is the highest S&P currently assigns to any financial guarantor.

In the report, S&P noted Assured Guaranty’s:

  • Very strong capital adequacy
  • Strong competitive position, built on a proven track record of credit discipline and market leadership
  • Strong operating performance as a result, in part, of the long-term earnings power of the U.S. public finance business
  • Strong liquidity, with conservative investment strategy
  • Strong, well-diversified underwriting strategy, with a global footprint and low country risk
  • Strong enterprise risk management
  • Strong understanding of the various risks the company faces by an experienced management team

In response to the report, Dominic Frederico, President and CEO said:

“The S&P report highlights our capital strength, disciplined risk management, strategic flexibility and market leadership. Specifically, based on our understanding of S&P’s capital adequacy model, we estimate that Assured Guaranty had $1.9 billion of capital in excess of the AAA requirement at year-end 2014. This is $400 million higher than the approximately $1.5 billion at year-end 2013 that S&P reported in its July 2, 2014 ratings report. Additionally, we continue to demonstrate our market leadership – we guaranteed approximately 64% of the insured U.S. municipal par that came to market in the second quarter of 2015.

“We have a proven and trusted business model and provide outstanding market liquidity for investors in our insured municipal bonds, which have $400 million of daily trading volume. Our multiple underwriting platforms support strong operating performance by allowing us to serve a range of markets and investor segments. And with our $12 billion in claims-paying resources, and approximately $400 million in annual income from investments alone, we are well positioned to support small, medium and large transactions.”

With regard to Assured Guaranty’s Puerto Rico exposure, S&P considered the effect of “a default by multiple issuers in Puerto Rico over a one, two, or three year time period” and concluded there would be no change in Assured Guaranty’s capital adequacy score based solely on such defaults. S&P noted that if Assured Guaranty pays any claims, the payments would be made over time based on each insured issue’s payment schedule.

“S&P has taken a hard look at all of our exposures, including those in Puerto Rico, and reiterated that the outlook for our AA ratings is stable,” said Mr. Frederico.

Any forward-looking statements made in this press release reflect Assured Guaranty’s current views with respect to future events and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. These risks and uncertainties include, but are not limited to, those resulting from changes in rating agency models or opinions, adverse credit developments in Puerto Rico or other portions of the insured portfolio and the impact of those developments on rating agency models and opinions, other risks and uncertainties that have not been identified at this time, management’s response to these factors, and other risk factors identified in Assured Guaranty’s filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which are made as of July 6, 2015. Assured Guaranty undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Assured Guaranty Ltd. is a publicly traded (NYSE: AGO) Bermuda-based holding company. Its operating subsidiaries provide credit enhancement products to the U.S. and international public finance, infrastructure and structured finance markets. More information on Assured Guaranty Ltd. and its subsidiaries can be found at AssuredGuaranty.com.


Assured Guaranty Ltd.
Robert Tucker, 212-339-0861
Managing Director, Investor Relations and Corporate Communications
Ashweeta Durani, 212-408-6042
Vice President, Corporate Communications