ASSURED GUARANTY LTD
For the period ended Mar 31, 2025. Filed May 9, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 9, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Financial Performance of Assured Guaranty
Financial Results
| First Quarter | ||
|---|---|---|
| 2025 | 2024 | |
| (in millions, except per share amounts) | ||
| GAAP | ||
| Net income (loss) attributable to AGL | $176 | $109 |
| Net income (loss) attributable to AGL per diluted share | $3.44 | $1.89 |
| Weighted average diluted shares | 50.7 | 57.1 |
| Non-GAAP (1) | ||
| Adjusted operating income (loss) | $162 | $113 |
| Adjusted operating income per diluted share | $3.18 | $1.96 |
| Weighted average diluted shares | 50.7 | 57.1 |
| Components of total adjusted operating income (loss) | ||
| Insurance segment | $168 | $149 |
| Asset Management segment | 12 | 1 |
| Corporate division | (20) | (37) |
| Other (2) | 2 | — |
| Adjusted operating income (loss) | $162 | $113 |
| Insurance Segment | ||
| Gross written premiums (GWP) | $35 | $61 |
| Present value of new business production (PVP) (1) | 39 | 63 |
| Gross par written | 5,002 | 3,743 |
| As of March 31, 2025 · As of December 31, 2024 | |||||
|---|---|---|---|---|---|
| Amount · Per Share · Amount · Per Share | |||||
| (in millions, except per share amounts) | |||||
| Shareholders’ equity attributable to AGL | $5,590 | $112.80 | $5,495 | $108.80 | |
| Adjusted operating shareholders’ equity (1) | 5,818 | 117.40 | 5,795 | 114.75 | |
| ABV (1) | 8,562 | 172.79 | 8,592 | 170.12 | |
| Common shares outstanding (3) | 49.6 | 50.5 | |||
(1) See “— Non-GAAP Financial Measures” for a definition of the financial measures that were not determined in accordance with accounting principles generally accepted in the United States of America (GAAP), a reconciliation of the non-GAAP financial measure to the most directly comparable GAAP measure, if available, and for additional details.
(2) Relates to the effect of consolidating FG VIEs and CIVs.
(3) See “— Overview — Key Business Strategies — Capital Management” above for information on common share repurchases.
Condensed Consolidated Results of Operations
Condensed Consolidated Results of Operations
| Three Months Ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| (in millions) | ||
| Revenues: | ||
| Net earned premiums | $91 | $119 |
| Net investment income | 87 | 84 |
| Net realized investment gains (losses) | (16) | 8 |
| Fair value gains (losses) on credit derivatives | 104 | 10 |
| Fair value gains (losses) on CCS | 2 | (10) |
| Fair value gains (losses) on FG VIEs | 1 | (3) |
| Fair value gains (losses) on CIVs | 19 | 22 |
| Foreign exchange gains (losses) on remeasurement | 37 | (12) |
| Fair value gains (losses) on trading securities | 1 | 26 |
| Other income (loss) | 19 | 1 |
| Total revenues | 345 | 245 |
| Expenses: | ||
| Loss and LAE (benefit) | 40 | (1) |
| Interest expense | 22 | 23 |
| Amortization of deferred acquisition costs (DAC) | 5 | 6 |
| Employee compensation and benefit expenses | 60 | 58 |
| Other operating expenses | 42 | 39 |
| Total expenses | 169 | 125 |
| Income (loss) before income taxes and equity in earnings (losses) of investees | 176 | 120 |
| Equity in earnings (losses) of investees | 53 | 24 |
| Income (loss) before income taxes | 229 | 144 |
| Less: Provision (benefit) for income taxes | 44 | 31 |
| Net income (loss) | 185 | 113 |
| Less: Noncontrolling interests | 9 | 4 |
| Net income (loss) attributable to Assured Guaranty Ltd. | $176 | $109 |
| Effective tax rate | 18.9% | 21.4% |
First Quarter 2025 Compared with First Quarter 2024
Net income attributable to AGL for first quarter 2025 was higher compared with the three-month period ended March 31, 2024 (first quarter 2024) primarily due to:
a fair value gain on credit derivatives related to the resolution of the LBIE litigation of $103 million in first quarter 2025,
foreign exchange gains on remeasurement of $37 million in first quarter 2025, compared with foreign exchange losses of $12 million in first quarter 2024, and
higher equity in earnings of investees in first quarter 2025, primarily generated by the Company’s investment in Sound Point and alternative investments in healthcare and legacy alternative investments.
These increases were offset in part by:
a loss and LAE in first quarter 2025 of $40 million, compared with a benefit of $1 million in first quarter 2024,
lower net earned premiums in first quarter 2025, compared with first quarter 2024 due to lower refundings of financial guaranty insurance exposures,
lower gains on trading securities, which primarily consist of contingent value instruments (CVIs) issued by Puerto Rico, in first quarter 2025, compared with first quarter 2024, and
net realized investment losses in first quarter 2025 primarily due to a change in the allowance for credit losses for Loss Mitigation Securities and realized losses on sales of securities, compared with gains in first quarter 2024.
The Company’s effective tax rate reflects the proportion of income recognized by each of the Company’s operating subsidiaries, with U.S. subsidiaries generally taxed at the U.S. marginal corporate income tax rate of 21%, U.K. subsidiaries taxed at the U.K. marginal corporate tax rate of 25%, the French subsidiary taxed at the French marginal corporate tax rate of 25%, and Assured Guaranty Re Ltd. (AG Re) and Cedar Personnel Ltd. taxed at the Bermuda marginal corporate tax rate of 15% starting January 1, 2025 and 0% for 2024. See Item 1, Financial Statements, Note 10, Income Taxes.
The following tables present pre-tax income by jurisdiction.
Pre-tax Income (Loss) by Tax Jurisdiction
| First Quarter | ||
|---|---|---|
| 2025 | 2024 | |
| (in millions) | ||
| U.S. | $194 | $129 |
| Bermuda | 46 | 30 |
| U.K. | (9) | (11) |
| France | (2) | (4) |
| Total | $229 | $144 |
Adjusted Operating Income
Adjusted operating income in first quarter 2025 was $162 million, compared with $113 million in first quarter 2024. The increase was primarily due to the gain related to the resolution of the LBIE litigation and higher equity in earnings of investees from Sound Point and alternative investments in first quarter 2025, offset in part by a higher loss expense in U.S. public finance, lower premiums on financial guaranty insurance contracts and lower unrealized gains on the trading portfolio in first quarter 2025. See “— Results of Operations — Reconciliation to GAAP” for the reconciliation of net income (loss) attributable to AGL to adjusted operating income (loss).
Book Value and ABV
Shareholders’ equity attributable to AGL and adjusted operating shareholders’ equity as of March 31, 2025 increased compared with December 31, 2024, primarily due to net income and unrealized gains on the investment portfolio, partially offset by share repurchases and dividends. ABV decreased primarily due to share repurchases and dividends, partially offset by adjusted operating income of $162 million and GWP of $35 million. See “— Non-GAAP Financial Measures” below for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders' equity and ABV.
On a per share basis, shareholders’ equity attributable to AGL, adjusted operating shareholders’ equity and ABV increased as of March 31, 2025 compared with December 31, 2024, due, in part, to the accretive effect of the share repurchase program. See “— Non-GAAP Financial Measures” for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders’ equity and ABV.
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