Facts about AGM and AGC Municipal Bond Insurance
COMMITMENT TO INVESTORS
A Case History
On Friday, February 1, 2013, Bank of New York Mellon, the trustee for the sewer revenue warrants issued by Jefferson County, Alabama, suspended principal and interest payments to warrant holders, including draws on AGM’s insurance policy. To protect its policyholders, AGM paid all the scheduled principal and interest payments due on the AGM-insured sewer warrants directly to The Depository Trust Company (DTC), where the ownership accounts are maintained. DTC were credited holders' accounts on the following Monday.
Assured Guaranty Increases Financial Stability
- Approximately $11 billion in claims-paying resources across the insurance subsidiaries of Assured Guaranty (together with its subsidiaries, “Assured Guaranty”).1
- Over three decades of experience.
- The only longstanding municipal bond insurer to continue to write new business throughout the financial crisis and recession.
- Insurance in force on approximately 6,200 municipal credits through its operating subsidiaries Assured Guaranty Municipal (AGM) and Assured Guaranty Corp. (AGC).
- AGM is currently writing new business in the U.S. municipal bond market.
Assured Guaranty Protects Investors in Distress Situations
- Unconditionally and irrevocably guarantees timely payment of principal and interest when due.
- Proven record of paying investors’ claims as contractually obligated. Investors in Assured Guaranty-wrapped obligations of Harrisburg, Pennsylvania; Jefferson County, Alabama; Stockton, California; Detroit, Michigan; and Puerto Rico have all received timely debt service payments, despite issuer defaults and even a trustee's refusal to draw on insurance policies. (See case history at right.)
Assured Guaranty Manages Risk
- Insures only transactions that meet its disciplined underwriting criteria and diversification requirements.
- Provides continuous surveillance of every credit in its insured portfolio, works with issuers to address financial problems before they become serious and takes remedial action when appropriate.
Assured Guaranty Provides Enhanced Market Liquidity for Investors’ Bonds
- On average, $2 billion of Assured Guaranty bonds trade each week during typical market conditions.
- Assured Guaranty-insured bonds have historically tended to demonstrate greater price stability than comparable uninsured bonds of the same issuer when that issuer was under financial stress.
- AGM is rated AA by S&P Global Ratings (S&P), AA+ by Kroll Bond Rating Agency (KBRA) and A2 by Moody’s Investors Service (Moody’s) and AGC is rated AA by S&P and KBRA. All the ratings have Stable Outlooks.
Assured Guaranty Provides Transparency
- AGM and AGC are subsidiaries of a public company that is subject to SEC and New York Stock Exchange regulation and therefore held to higher legal standards of disclosure, oversight and transparency than non-public companies.
1As of December 31, 2020. Aggregate data for insurance subsidiaries within the Assured Guaranty Ltd. (AGL) (NYSE: AGO) group. Details in the latest AGL Financial Supplement at assuredguaranty.com/agldata.
© Assured Guaranty Ltd. 2021. Published March 4, 2021. Data as of December 31, 2020. The information in this fact sheet should be read in conjunction with the Securities and Exchange Commission (SEC) filings of Assured Guaranty Ltd., including the risk factors set forth therein, all of which speak only as of the dates indicated therein. Any forward-looking statements made in this fact sheet reflect Assured Guaranty’s current views with respect to future events and financial performance 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. Additionally, insured securities in the future may not experience the enhanced liquidity and price stability sometimes observed in the past. For example, Assured Guaranty’s financial strength and ratings, and its financial performance and condition, could deteriorate and it may be unable to execute its business model and strategies. The materials in this fact sheet do not constitute advice with respect to any municipal financial products, or the issuance of any municipal securities. You should not rely on such material to make any decision with respect to these topics. Neither we nor any of our affiliates is acting as an advisor in connection with any municipal financial product or any offering of municipal securities. We encourage you to consult your own financial and legal advisors and to make your own independent investigation regarding any municipal financial product. Municipal financial product includes any municipal derivative, guaranteed investment contract, plan or program for the investment of the proceeds of municipal securities, or the recommendation and brokerage of municipal escrow investments.