ASSURED GUARANTY LTD

You should carefully consider the following information, together with the information contained in AGL’s other filings with the SEC. The risks and uncertainties discussed below are not the only ones the Company faces. However, these are the risks that the Company’s management believes are material. The Company may face additional risks or uncertainties that are not presently known to the Company or that management currently deems immaterial, and such risks or uncertainties also may impair its business or results of operations. The risks discussed below could result in a significant or material adverse effect on the Company’s financial condition, results of operations, liquidity, or business prospects.

Summary of Risk Factors

The following summarizes some of the risks and uncertainties that may adversely affect the Company’s financial condition, results of operations, capital, liquidity, business prospects or share price. It is provided for convenience and should be read together with the more expansive explanations below this summary.

Risks Related to Economic, Market and Political Conditions and Natural Phenomena

•Developments in the U.S. and global financial markets and economy generally.

•Significant budget deficits and pension funding and revenue shortfalls of certain state and local governments and entities that issue obligations the Company insures.

•Significant risks from large individual or correlated exposures.

•Losses on obligations insured by the Company significantly in excess of those expected by the Company or recoveries significantly below those expected by the Company.

•Downgrades to the U.S. government’s sovereign credit ratings, or to the credit ratings of instruments issued, insured or guaranteed by related institutions, agencies or instrumentalities.

•Changes in attitudes toward debt repayment negatively impacting the Company’s insurance portfolio.

•Narrow credit spreads adversely affecting demand for financial guaranty insurance.

•Global climate change adversely affecting the Company’s insurance portfolio and investments.

•Credit losses and interest rate changes adversely affecting the Company’s investments.

•Expansion of the categories and types of the Company’s investments (including those accounted for as CIVs), including allocations of investments to Sound Point and the exclusivity arrangement with Sound Point may expose it to increased credit, interest rate, liquidity and other risks.

Risks Related to Estimates, Assumptions and Valuations

•Estimates of expected insurance losses to be paid (recovered), including losses with respect to related legal proceedings, are subject to uncertainties and actual amounts may be different, causing the Company to reserve either too little or too much for future losses.

•The valuation of many of the Company’s assets and liabilities includes methodologies, estimates and assumptions that are subject to differing interpretations and could result in changes to valuations of the Company’s assets and liabilities that may materially adversely affect the Company’s financial condition, results of operations, capital, business prospects and share price.

Strategic Risks

•Competition in the Company’s industries.

•Strategic transactions not resulting in the benefits anticipated.

•The Company’s investments in Sound Point are subject to the risks faced by asset managers generally and the risks of Sound Point’s investment business more specifically.

•Minority ownership interests and inability to control the business, management or policies of such interests.

•Alternative investments not resulting in the benefits anticipated.

•A downgrade of the financial strength or financial enhancement ratings of any of the Company’s insurance or reinsurance subsidiaries.

Operational Risks

•Fluctuations in foreign exchange rates.

•Some of the Company’s non-U.S. operations expose it to less predictable political, credit and legal risks.

•The loss of the Company’s key executives or its inability to retain other key personnel.

•A cyberattack, security breach or failure in the Company’s or a vendor's information technology system, or a data privacy breach of the Company’s or a vendor’s information technology system.

•Errors in, overreliance on, or misuse of, models.

•Significant claim payments may reduce the Company’s liquidity.

•A sudden need to raise additional capital as a result of insurance losses or as a result of changes in regulatory or rating agency capital requirements applicable to its insurance companies, at a time when additional capital may not be available or may be available only on unfavorable terms.

•Large insurance losses substantially increasing the Company’s insurance subsidiaries’ leverage ratios, and preventing them from writing new insurance.

•The Company’s holding companies' ability to meet their obligations may be constrained.

•The ability of AGL and its subsidiaries to meet their liquidity needs may be limited.

Risks Related to Taxation

•Changes in U.S. tax laws could reduce the demand or profitability of financial guaranty insurance, or negatively impact the Company’s investments.

•Certain of the Company’s non-U.S. subsidiaries may be subject to U.S. tax.

•AGL may, and AG Re and AGRO will, become subject to taxes in Bermuda, which may adversely affect the Company’s future results of operations and an investment in the Company.

•U.S. Persons holding AGL’s shares may be subject to taxation under the U.S. CFC rules.

•U.S. Persons holding AGL’s shares may be subject to additional U.S. income taxation on their proportionate share of the Company's RPII.

•U.S. tax-exempt shareholders may be subject to unrelated business taxable income rules.

•U.S. Persons holding AGL’s shares may be subject to adverse tax consequences if AGL is considered to be a PFIC for U.S. federal income tax purposes.

•Changes in U.S. federal income tax law adversely affecting the Company and an investment in AGL’s common shares.

•An ownership change under Section 382 of the Code could have adverse U.S. federal tax consequences.

•A change in AGL’s U.K. tax residence or its ability to otherwise qualify for the benefits of income tax treaties to which the U.K. is a party could adversely affect an investment in AGL’s common shares.

•Changes in U.K. tax law or in AGL’s ability to satisfy all the conditions for exemption from U.K. taxation on dividend income or capital gains in respect of its direct subsidiaries could affect an investment in AGL’s common shares.

•An adverse adjustment under U.K. legislation governing the taxation of U.K. tax resident holding companies on the profits of their non-U.K. subsidiaries adversely affecting Assured Guaranty's tax liability.

•An adverse adjustment under U.K. transfer pricing legislation could adversely impact Assured Guaranty’s tax liability.

•Assured Guaranty’s financial results may be affected by measures taken in response to the Organization for Economic Co-operation and Development (OECD) Base Erosion and Profit Shifting (BEPS) project.

Risks Related to GAAP, Applicable Law and Litigation

•An inability to obtain accurate and timely financial information from Sound Point and other alternative investment managers, including AHP, may impair the Company’s ability to comply with reporting obligations.

•Changes in the fair value of the Company’s insured credit derivatives portfolio, certain of its investments, its committed capital securities (CCS), its FG VIEs, its CIVs, and/or the Company’s decision to consolidate or deconsolidate one or more FG VIEs and/or CIVs during a financial reporting period, subjecting its financial condition and results of operations to volatility.

•Changes in industry and other accounting practices.

•Changes in or inability to comply with applicable law and regulations.

•Legislation, regulation or litigation arising out of the struggles of distressed obligors.

•Certain insurance regulatory requirements and restrictions constraining AGL’s ability to pay dividends and fund share repurchases and other activities.

•Applicable insurance laws may make it difficult to effect a change of control of AGL.

Risks Related to AGL’s Common Shares

•Volatility in the market price of AGL’s common shares.

•Provisions in the Code and AGL’s Bye-Laws reducing or increasing the voting rights of its common shares.

•Provisions in AGL’s Bye-Laws potentially restricting the ability to transfer common share or requiring shareholders to sell their common shares.