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Moody’s Affirms Assured Guaranty Ratings Despite Puerto Rico Exposure

By on August 9, 2016

SAN JUAN – Moody’s Investors Service affirmed the ratings of bond insurer Assured Guaranty Ltd. and its subsidiaries, including Assured Guaranty Municipal Corp. (AGM), Assured Guaranty Corp. (AGC), Assured Guaranty (Europe) Ltd. (AGE) and Assured Guaranty (UK) Ltd. (AGUK).

While affirming the stable outlooks on the A2 ratings of AGM and AGE, Moody’s revised to stable from negative the outlooks for the A3 ratings of AGC and AGUK.

Assured Guaranty screenshotMoody’s summarized its rating rationale by noting Assured Guaranty’s

  • “strong overall capital profile and core earnings power”
  • “ability to underwrite transactions in both the public finance and structured finance markets worldwide through its multiple insurance operating subsidiaries”
  • “ongoing improvement in capital adequacy” and
  • “leadership position in the financial guaranty insurance sector.”

Regarding the change in AGC’s rating outlook, Moody’s cited AGC’s “strengthening capital adequacy profile,” noting that the recent acquisitions of Radian Asset Assurance and CIFG North America increased AGC’s capital resources, invested assets, and future premium earnings.

“With this most recent report, Moody’s, S&P Global Ratings and Kroll Bond Rating Agency have all now affirmed their ratings and stable outlooks for the financial strength of the Assured Guaranty units they rate,” said Dominic Frederico, President and CEO. “All three agencies have indicated that Assured Guaranty’s exposures to Puerto Rico credits are unlikely to affect their current ratings.” (Assured Guaranty’s Municipal Assurance Corp. subsidiary has no exposure to Puerto Rico.)

“With $12 billion in claims-paying resources, $400 million of annual income currently generated from our investment portfolio and a strong credit profile, Assured Guaranty is well positioned to help issuers reduce borrowing costs while protecting insured bondholders,” he added.

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