Assured Guaranty Ltd. · NYSE:AGO
Assured Guaranty — Debt Investor Presentation (December 2024)
53 slides from Assured Guaranty's debt investor presentation, Dec 31, 2024
Slide 1: Fixed Income Investor Presentation
Fixed Income Investor Presentation December 31, 2024
Slide 2: Table of Contents
Table of Contents Page Forward-Looking Statements and Safe Harbor Disclosure 3 Conventions and Non-GAAP Financial Measures 4 Assured Guaranty Overview 5 New Business Activity 18 Asset Management and Alternative Investments 25 Assured Guaranty Insured Portfolio 27 AG Insured Portfolio 39 AGUK, AGE, A
Slide 3: Forward-Looking Statements and Safe Harbor Disclosure
Forward-Looking Statements and Safe Harbor Disclosure • This presentation contains information that includes or is based upon forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward looking statements give the expectations or forecasts of future
Slide 4: Conventions and Non-GAAP Financial Measures
Conventions and Non-GAAP Financial Measures • Unless otherwise noted, the following conventions are used in this presentation: – Ratings on Assured Guaranty’s insured portfolio are Assured Guaranty’s internal ratings. ▪ Internal credit ratings are expressed on a ratings scale similar to that used by
Slide 5: Assured Guaranty Overview
ASSURED GUARANTY Assured Guaranty Overview
Slide 6: Overview
Assured Guaranty Overview • Assured Guaranty Ltd. (“AGL” and, together with its subsidiaries, “Assured Guaranty” or the “Company”) is the leading financial guaranty franchise – We are the only long-standing financial guaranty company to have written new business throughout the 2008 financial crisis
Slide 7: Financial Guaranty Business Model
Assured Guaranty Overview Financial Guaranty Business Model • What do we insure? – We insure financial obligations in three main sectors ▪ U.S. public finance and infrastructure transactions ▪ Non-U.S. public finance and infrastructure transactions ▪ U.S. and non-U.S. structured finance transactions
Slide 8: Financial Guaranty Business Model (Continued)
Assured Guaranty Overview Financial Guaranty Business Model (Continued) • How does Assured Guaranty’s policy benefit investors? – Our policy benefits investors because we provide credit selection, underwriting, surveillance and remediation, in addition to timely payment of scheduled principal and in
Slide 9: Resilience and Enduring Financial Strength
Assured Guaranty Overview Resilience and Enduring Financial Strength Assured Guaranty maintained over $10 billion of claims-paying resources1 over 16 years while paying nearly $15 billion to insured investors From January 1, 2008 through $16 As of Dec. 31 of each year December 31, 2024: ($ in billio
Slide 10: Insurance Subsidiaries' Claims-Paying Resources
Assured Guaranty Overview Insurance Subsidiaries’ Claims-Paying Resources As of December 31, 2024 ($ in millions) AG AG Re1 Eliminations2 Total Claims-paying resources Policyholders' surplus $ 3,524 $ 746 $ 59 $ 4,329 Contingency reserve 1,392 — — 1,392 Qualified statutory capital 4,916 746 59 5,721
Slide 11: AGM Merger Into AG
Assured Guaranty Overview AGM Merger Into AG • Assured Guaranty Municipal Corp. (AGM) merged with and into Assured Guaranty Inc. (AG), effective August 1, 2024 • Some of the benefits of the merger include: – Created a larger, combined company to guarantee all the obligations in both the AGM and AG i
Slide 12: Assured Guaranty Ltd. Corporate Structure (Pre-Merger)
Assured Guaranty Overview Assured Guaranty Ltd. Corporate Structure (Pre-Merger) Assured Guaranty Ltd. Hamilton, Bermuda Publicly Traded Holding Company (NYSE: AGO) A (stable outlook) / Baa1 (stable outlook) issuer credit ratings Assured Guaranty US Holdings Inc. (AGUS) U.S. Holding Company S&P: A (
Slide 13: Assured Guaranty Ltd. Corporate Structure (Current)
Assured Guaranty Overview Assured Guaranty Ltd. Corporate Structure (Current) Assured Guaranty Ltd. Hamilton, Bermuda Publicly Traded Holding Company (NYSE: AGO) A (stable outlook) / Baa1 (stable outlook) issuer credit ratings Assured Guaranty US Holdings Inc. (AGUS) Assured Guaranty Re Ltd. (AG Re)
Slide 14: Principal Insurance Platforms
Assured Guaranty Overview Principal Insurance Platforms • AG, AGUK and AGE operate as three separate financial guaranty platforms, with AG Re operating as a reinsurer – AG focuses on insuring U.S. public finance, infrastructure and structured finance transactions – AGUK serves the U.K. market and ce
Slide 15: Changes Since 2009
Assured Guaranty Overview Changes Since 2009 Claims-Paying Resources Insured Leverage ($ in billions) 71.3x 70.5x $13.2 $13.2 $12.8 $12.8 $12.6 $12.6 $12.7 $12.1 $12.1 $11.9 62.9x $11.4 58.9x $11.1 $11.2 $10.8 $10.7 $10.2 52.7x 47.4x 46.7x 46.2x 42% Decline 41.2x 41.1x 38.6x 39.5x 37.5x 34.5x 34.0x
Slide 16: Financial Strength Ratings
Assured Guaranty Overview Financial Strength Ratings Financial Strength Ratings1 S&P KBRA Moody's AA AA+ A1 AG Stable Outlook Stable Outlook Stable Outlook (May 2024) (October 2024) (July 2024) Recent Updates • In August 2024, S&P issued a press release indicating no change to the AA (stable outlook
Slide 17: Underlying Value: High-Quality Investment Portfolio
Assured Guaranty Overview Underlying Value: High-Quality Investment Portfolio Total Invested Assets and Cash1,2 U.S. government & As of December 31, 2024 agencies 3 AAA 1% 24% Other invested assets 6% Sound Point 5% • Predominately consists of highly rated, fixed maturity and short-term investments,
Slide 18: New Business Activity
ASSURED GUARANTY New Business Activity
Slide 19: New Business Activity Overview
New Business Activity Overview Gross Par Written ($ in millions) • Assured Guaranty insured $32 billion of aggregate par in 2024 $31,829 – This aggregate amount of par is the largest amount $28,960 in a decade $26,656 $23,265 $22,047 – U.S. public finance insured the second largest amount of par in
Slide 20: Insurance: U.S. Public Finance
New Business Activity Insurance: U.S. Public Finance • Assured Guaranty’s U.S. public finance new business production was strong in 2024 – U.S. public finance insured $24 billion of total par that closed in 2024 – U.S. public finance PVP1 that closed in 2024 was $270 million, 27% higher than PVP1 in
Slide 21: Broadening Market Awareness: Current Advertising Campaigns
U.S. Public Finance Broadening Market Awareness: Current Advertising Campaigns 21 ASSURED GUARANTY INC.
Slide 22: Competitive Landscape: Select AG Transactions in 2024
U.S. Public Finance Competitive Landscape: Select AG Transactions in 2024 Source: Refinitiv SDC Database. Amounts are on a sale-date basis and reflect only those series insured by Assured Guaranty Inc. (New York, NY). 22 ASSURED GUARANTY INC.
Slide 23: Insurance: Non-U.S. Public Finance
New Business Activity Insurance: Non-U.S. Public Finance Non-U.S. Public Finance PVP1 ($ in millions) • In 2024, business activity was primarily attributable to secondary market guarantees of $82 $79 $83 several regulated utilities and airport $68 $67 transactions • In 2023, business activity was pr
Slide 24: Insurance: Global Structured Finance
New Business Activity Insurance: Global Structured Finance Global Structured Finance PVP1 • In 2024, new business PVP primarily consisted ($ in millions) of pooled corporate transactions, insurance securitizations, subscription finance $109 transactions and a portfolio of diversified real estate $65
Slide 25: Asset Management and Alternative Investments
Asset Management and Alternative Investments
Slide 26: Asset Management and Alternative Investments Highlights
Asset Management and Alternative Investments Highlights • In July 2023, Assured Guaranty contributed most of its asset management business, other than that conducted by Assured Healthcare Partners, LLC (AHP), to Sound Point in exchange for approximately 30% of the combined Sound Point entity, and so
Slide 27: Assured Guaranty Insured Portfolio
Assured Guaranty Insured Portfolio Eiffage CEVM / Foster + Partners / Jean-Pierre Lescourret
Slide 28: Net Par Outstanding by Sector as of December 31, 2024
Assured Guaranty Insured Portfolio Net Par Outstanding by Sector as of December 31, 2024 Portfolio Diversification by Sector Non-U.S. Structured Finance U.S. 1% Public Finance 77% U.S. Structured Finance 3% Non-U.S. Public Finance 19% $261.6 billion1,2 Global U.S. Public Finance Portfolio Non-U.S. P
Slide 29: Net Par Outstanding by Ratings as of December 31, 2024
Assured Guaranty Insured Portfolio Net Par Outstanding by Ratings as of December 31, 2024 Portfolio Diversification by Rating BIG AAA 4% 1% AA 10% BBB 36% A 49% $261.6 billion1 Global. U.S. Public Finance Portfolio Non-U.S. Public Finance Portfolio Structured Finance Portfolio BIG AAA BIG AAA BIG AA
Slide 30: Net Par Outstanding Amortization
Assured Guaranty Insured Portfolio Net Par Outstanding Amortization • Since year-end 2018, the net par outstanding of the insured portfolio has stabilized significantly – Since year-end 2022, net par outstanding increased by $29 billion, with increased par outstanding in all three asset classes: U.S
Slide 31: Puerto Rico Update
Assured Guaranty Insured Portfolio Puerto Rico Update • The Company has divested the majority of the consideration it received as a result of the resolution of the Company’s exposure to insured Puerto Rico credits experiencing payment default other than PREPA (2022 Puerto Rico Resolutions) – On Dece
Slide 32: Puerto Rico Exposure
Assured Guaranty Insured Portfolio Puerto Rico Exposure Exposure to Puerto Rico As of December 31, 2024 ($ in millions) Net Par Outstanding Total Net Par Gross Par AG AG Re Outstanding Outstanding Defaulted Puerto Rico Exposures Puerto Rico Electric Power Authority (PREPA) $378 $154 $532 $540 Total
Slide 33: BIG Surveillance Category
Assured Guaranty Insured Portfolio BIG Surveillance Category The Company assigns each BIG exposure to one of the three BIG surveillance categories based on loss modeling1 and scenario probability weighting: BIG Surveillance Category 1: Exposures for which there are possible future losses, on a prese
Slide 34: Net Par Outstanding by BIG Surveillance Category
Assured Guaranty Insured Portfolio Net Par Outstanding by BIG Surveillance Category1 Financial Guaranty Insurance and Credit Derivatives Surveillance Categories As of December 31, 2024 Net Par Percent of Percent of ($ millions) Outstanding BIG Par Total Par • Approximately $8.1 billion (3.1% of tota
Slide 35: Total BIG Exposure
Assured Guaranty Insured Portfolio Total BIG Exposure • Exposure with an internal BIG rating is $10.2 billion – This amount decreased by $468 million in the fourth quarter of 2024 – Approximately $8.1 billion of this exposure are currently categorized as BIG Surveillance Category 1, which are exposu
Slide 36: BIG 2 and BIG 3 Exposure
Assured Guaranty Insured Portfolio BIG 2 and BIG 3 Exposure • Transactions rated BIG 2 and BIG 3 represent approximately 20% of all BIG transactions (0.8% of total net par outstanding) – The par amount of BIG 2 and BIG 3 decreased by approximately 30% in 2024 – BIG Surveillance Category 2 and Catego
Slide 37: Expected Loss and LAE to Be Paid: Three Months Ended Dec 31, 2024
Assured Guaranty Expected Loss and LAE to Be Paid Three Months Ended December 31, 2024 ($ in millions) Rollforward of Net Expected Loss and LAE to be Paid1 for the Three Months Ended December 31, 2024 Net Expected Loss Net Economic Loss Net Expected Loss to be Paid Development Net (Paid) to be Paid
Slide 38: Expected Loss and LAE to Be Paid: Year Ended Dec 31, 2024
Assured Guaranty Expected Loss and LAE to Be Paid Year Ended December 31, 2024 ($ in millions) Rollforward of Net Expected Loss and LAE to be Paid1 for the Year Ended December 31, 2024 Net Expected Loss Net Economic Loss Net Expected Loss to be Paid Development Net (Paid) to be Paid (Recovered) as o
Slide 39: AG Insured Portfolio
AG Insured Portfolio Eiffage CEVM / Foster + Partners / Jean-Pierre Lescourret
Slide 40: AG Net Par Outstanding by Sector as of December 31, 2024
AG Insured Portfolio Net Par Outstanding by Sector as of December 31, 2024 Portfolio Diversification by Sector Non-U.S. Structured Finance 1% U.S. Public U.S. Finance Structured 78% Finance 3% Non-U.S. Public Finance 18% $201.6 billion1 Global U.S. Public Finance Portfolio Non-U.S. Public Finance Po
Slide 41: AG Net Par Outstanding by Ratings as of December 31, 2024
AG Insured Portfolio Net Par Outstanding by Ratings as of December 31, 2024 Portfolio Diversification by Rating BIG AAA 4% 1% AA 10% BBB 36% A 49% $201.6 billion Global U.S. Public Finance Portfolio Non-U.S. Public Finance Portfolio Structured Finance Portfolio BIG AAA AAA BIG <1% BIG AAA 1% 4% 12%
Slide 42: AG Investment Portfolio
AG Investment Portfolio Value as of December 31, 2024 Invested Assets and Cash1,2 As of December 31, 2024 U.S. government & agencies 3 1% AAA Other invested 23% assets <1% Equity method investments 6% • Predominately consists of highly rated, Fixed maturity securities, trading 4 fixed maturity and s
Slide 43: AGUK, AGE, AG Re and AGRO
ASSURED (GUARANTY AGUK, AGE, AG Re and AGRO M4
Slide 44: AGUK and AGE Net Par Outstanding
AGUK and AGE Net Par Outstanding AGUK Net Par Outstanding As of December 31, 2024 ($ in billions) Non-U.S. Sovereign • AGUK is an insurance company domiciled in the and Sub- U.K. that provides financial guarantees in the U.K. sovereign $1.0 and certain other countries Non-U.S. – Provides insurance i
Slide 45: AG Re and AGRO
AG Re and AGRO AG Re AGRO Net Par Outstanding1 Outstanding Net Exposure2 As of December 31, 2024 ($ in billions) As of December 31, 2024 ($ in billions) Diversified Non-U.S. U.S. real estate Structured Structured $2.0 Finance Finance $3.6 6% $1.0 Financial 2% Guaranty Structured 33% Non-U.S. Finance
Slide 46: Appendix
ASSURED (GUARANTY
Slide 47: Explanation of Non-GAAP Financial Measures
Appendix Explanation of Non-GAAP Financial Measures The Company discloses both: (i) financial measures determined in accordance with GAAP; and (ii) financial measures not determined in accordance with GAAP (non-GAAP financial measures). Financial measures identified as non-GAAP should not be conside
Slide 48: Explanation of Non-GAAP Financial Measures (Cont'd)
Appendix Explanation of Non-GAAP Financial Measures (Cont’d) The following paragraphs define each non-GAAP financial measure disclosed by the Company and describe why it is useful. To the extent there is a directly comparable GAAP financial measure, a reconciliation of the non-GAAP financial measure
Slide 49: Explanation of Non-GAAP Financial Measures (Cont'd)
Appendix Explanation of Non-GAAP Financial Measures (Cont’d) Adjusted Operating Shareholders’ Equity and Adjusted Book Value: Management believes that adjusted operating shareholders’ equity is a useful measure because it excludes the fair value adjustments on investments, credit derivatives and CCS
Slide 50: Explanation of Non-GAAP Financial Measures (Cont'd)
Appendix Explanation of Non-GAAP Financial Measures (Cont’d) Adjusted Operating Return on Equity (Adjusted Operating ROE): Adjusted Operating ROE represents adjusted operating income for a specified period divided by the average of adjusted operating shareholders’ equity at the beginning and the end
Slide 51: Reconciliation of Gross Written Premiums to PVP
Appendix AGL Consolidated Reconciliation of Gross Written Premiums (GWP) to PVP1 Three Months Ended Reconciliation of GWP to PVP1 December 31, Year Ended December 31, (dollars in millions) 2024 2023 2023 2022 2021 2020 2019 2018 2017 Total GWP $186 $136 $357 $360 $377 $454 $677 $612 $307 2 Less: Ins
Slide 52: Reconciliation of Net Income Attributable to AGL to Adjusted Operating Income
Appendix Reconciliation of Net Income (Loss) Attributable to AGL to Adjusted Operating Income1 Three Months Ended Year Ended Adjusted Operating Income1 Reconciliation December 31, December 31, (dollars in millions, except per share amounts) 2024 2023 2024 2023 Per Per Diluted Per Diluted Diluted Per
Slide 53: Contacts
Assured Guaranty Contacts: Robert Tucker Senior Managing Director Investor Relations and Corporate Communications Direct: 212.339.0861 rtucker@agltd.com Michael Walker Managing Director Fixed Income Investor Relations Direct: 212.261.5575 mwalker@agltd.com Andre Thomas Managing Director Investor Rel
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