ASSURED GUARANTY LTD
For the period ended Jun 30, 2025. Filed Aug 8, 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.
Jun 30, 2025 · Filed Aug 8, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
See the whole filing, with its images and exhibitsContents
Investment Portfolio
The Company’s principal objectives in managing its investment portfolio are to support the highest possible ratings for each operating company, manage investment risk within the context of the underlying portfolio of insurance risk, maintain sufficient liquidity to cover unexpected stress in the insurance portfolio, and maximize after-tax net investment income. As of June 30, 2025, the Company had $6,498 million of available-for-sale fixed-maturity securities, of which $5,451 million were managed by three investment managers who are required to, in accordance with the Company’s investment guidelines, maintain their portion of the Company’s investment portfolio with an overall credit quality rated at a minimum of A+/A1/A+ by S&P/Moody’s/Fitch Ratings Inc. In addition, $238 million of available-for-sale fixed-maturity securities were CLO equity tranches managed by Sound Point.
Changes in interest rates affect the value of the Company’s fixed-maturity securities. As interest rates fall, the fair value of fixed-maturity securities generally increases and, as interest rates rise, the fair value of fixed-maturity securities generally decreases. The Company’s portfolio of fixed-maturity securities primarily consists of investment-grade, liquid instruments. Other invested assets include other alternative investments, which are generally less liquid. For more information about the investment portfolio and a detailed description of the Company’s valuation of investments, see Item 1, Financial Statements, Note 7, Investments, and Note 9, Fair Value Measurement.
Carrying Value
| As of | ||
|---|---|---|
| June 30, 2025 | December 31, 2024 | |
| (in millions) | ||
| Fixed-maturity securities, available-for-sale | $6,498 | $6,369 |
| Fixed-maturity securities, trading (1) | 137 | 147 |
| Short-term investments | 939 | 1,221 |
| Other invested assets (2) | 995 | 926 |
| Total | $8,569 | $8,663 |
(1) Includes primarily CVIs received as part of resolutions of Puerto Rico exposures in 2022, which are not rated.
(2) Excludes investments in Sound Point funds that are consolidated. See Item 1, Financial Statements, Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles.
The Company’s available-for-sale fixed-maturity securities had a duration of 4.7 years and 4.3 years as of June 30, 2025 and December 31, 2024, respectively.
Available-for-Sale Fixed-Maturity Securities By Rating
The following table summarizes the ratings distributions of the Company’s available-for-sale fixed-maturity securities as of June 30, 2025 and December 31, 2024. Ratings generally reflect the lower of Moody’s and S&P classifications, except for (i) Loss Mitigation Securities rated BIG, and (ii) CLO equity tranches, which are not rated. See Item 1, Financial Statements, Note 7, Investments, for additional information.
Distribution of Available-for-Sale Fixed-Maturity Securities by Rating
| As of | ||
|---|---|---|
| Rating | June 30, 2025 | December 31, 2024 |
| AAA | 12.8% | 12.5% |
| AA | 32.5 | 35.0 |
| A | 24.5 | 23.6 |
| BBB | 16.8 | 16.3 |
| BIG | 8.4 | 8.1 |
| Not rated | 5.0 | 4.5 |
| Total | 100.0% | 100.0% |
Other Investments
Other invested assets, which are generally less liquid than fixed-maturity securities, primarily consist of the ownership interest in Sound Point and alternative investments across a variety of strategies. See “— Commitments” below.
Sound Point and Alternative Investments
| As of June 30, 2025 (1) | As of December 31, 2024 | |||||
|---|---|---|---|---|---|---|
| Investments | CIVs | Consolidated | Investments | CIVs | Consolidated | |
| (in millions) | ||||||
| Fixed-maturity securities, available-for-sale | $280 | $— | $280 | $319 | $— | $319 |
| Fixed-maturity securities, trading | 20 | — | 20 | 24 | — | 24 |
| Other invested assets: | ||||||
| Ownership interest in Sound Point | 412 | — | 412 | 418 | — | 418 |
| CLOs | 96 | — | 96 | 100 | — | 100 |
| Private healthcare investing | 166 | — | 166 | 153 | — | 153 |
| Asset-based/specialty finance | 151 | (40) | 111 | 142 | (33) | 109 |
| Private minority stakes in alternative asset managers | 79 | — | 79 | 69 | — | 69 |
| Other | 131 | — | 131 | 77 | — | 77 |
| Total | $1,335 | $(40) | $1,295 | $1,302 | $(33) | $1,269 |
(1) The alternative investments, excluding the ownership interest in Sound Point, had an inception-to-date annualized internal rate of return of 13%.
Effect of Ownership Interest in Sound Point and Alternative Investments
on Condensed Consolidated Statements of Operations
| Second Quarter 2025 | Second Quarter 2024 | |||||
|---|---|---|---|---|---|---|
| Investments | CIVs | Consolidated | Investments | CIVs | Consolidated | |
| (in millions) | ||||||
| Net investment income (1) | $11 | $— | $11 | $1 | $— | $1 |
| Net realized investment gains (losses) | (7) | — | (7) | — | — | — |
| Fair value gains (losses) on trading securities | — | — | — | — | — | — |
| Equity in earnings (losses) of investees: | ||||||
| Equity in earnings of Sound Point | (1) | — | (1) | (3) | — | (3) |
| Equity in earnings (losses) of alternative investments: | ||||||
| CLOs | (5) | — | (5) | 6 | (3) | 3 |
| Private healthcare investing | 1 | — | 1 | (2) | — | (2) |
| Asset-based/specialty finance | 5 | (1) | 4 | 7 | (4) | 3 |
| Private minority stakes in alternative asset managers | 1 | — | 1 | 2 | — | 2 |
| Other | 3 | — | 3 | 2 | — | 2 |
| Equity in earnings (losses) of investees | 4 | (1) | 3 | 12 | (7) | 5 |
| Total | $8 | $(1) | $7 | $13 | $(7) | $6 |
(1) Second quarter 2025 includes CLO equity tranches distributed from a CLO fund in the fourth quarter of 2024.
Effect of Ownership Interest in Sound Point and Alternative Investments
on Condensed Consolidated Statements of Operations
| Six Months 2025 · Six Months 2024 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Investments · CIVs · Consolidated · Investments · CIVs · Consolidated | ||||||||||
| (in millions) | ||||||||||
| Net investment income (1) | $23 | $— | $23 | $2 | $— | $2 | ||||
| Net realized investment gains (losses) | (7) | — | (7) | — | — | — | ||||
| Fair value gains (losses) on trading securities | 1 | — | 1 | — | — | — | ||||
| Equity in earnings (losses) of investees: | ||||||||||
| Equity in earnings of Sound Point | 12 | — | 12 | 1 | — | 1 | ||||
| Equity in earnings (losses) of alternative investments: | ||||||||||
| CLOs | 3 | — | 3 | 26 | (18) | 8 | ||||
| Private healthcare investing | 13 | — | 13 | 2 | — | 2 | ||||
| Asset-based/specialty finance | 14 | (7) | 7 | 11 | (6) | 5 | ||||
| Private minority stakes in alternative asset managers | 15 | — | 15 | 10 | — | 10 | ||||
| Other | 6 | 6 | 3 | — | 3 | |||||
| Equity in earnings (losses) of investees | 63 | (7) | 56 | 53 | (24) | 29 | ||||
| Total | $80 | $(7) | $73 | $55 | $(24) | $31 | ||||
(1) Six months 2025 includes CLO equity tranches distributed from a CLO fund in the fourth quarter of 2024.
Commitments
The Company has agreed to invest an aggregate amount of $1.5 billion in alternative investments, including $1 billion in Sound Point managed investments, subject to certain conditions precedent. Unfunded commitments for alternative investments as of June 30, 2025 were $567 million. See Item 1, Financial Statements, Note 1, Business and Basis of Presentation, for a description of the alternative investments agreement with Sound Point.
Restricted Assets
Based on fair value, fixed-maturity securities, short-term investments and cash that are either held in trust for the benefit of third-party ceding insurers in accordance with statutory requirements, placed on deposit to fulfill state licensing requirements or otherwise pledged or restricted totaled $79 million as of both June 30, 2025 and December 31, 2024. The investment portfolio also contains securities that are held in trust by certain AGL subsidiaries or are otherwise restricted for the benefit of other AGL subsidiaries in accordance with statutory and regulatory requirements with a fair value of $1,092 million and $1,135 million as of June 30, 2025 and December 31, 2024, respectively.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.