ASSURED GUARANTY LTD

Financial Results

(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

Third Quarter 2025 Compared with Third Quarter 2024

Net income attributable to AGL for third quarter 2025 was lower compared with the three-month period ended September 30, 2024 (third quarter 2024) primarily due to foreign exchange losses on remeasurement of $23 million in third quarter 2025 compared with foreign exchange gains on remeasurement of $55 million in third quarter 2024, and lower loss and LAE benefit in third quarter 2025.

Nine Months 2025 Compared with Nine Months 2024

Net income attributable to AGL for nine months 2025 was higher compared with nine months 2024 primarily due to:

•a fair value gain on credit derivatives related to the resolution of the LBIE litigation of $103 million in nine months 2025,

•foreign exchange gains on remeasurement of $93 million in nine months 2025, compared with of $43 million in nine months 2024,

•higher equity in earnings of investees in nine months 2025, primarily generated by the Company’s investments in Sound Point, healthcare funds and legacy alternative investments, and

•higher net investment income in nine months 2025 primarily due to investment income on collateralized loan obligations (CLOs) equity tranches in the available-for-sale portfolio.

These increases were offset in part by:

•a loss and LAE in nine months 2025 of $38 million, compared with a benefit of $54 million in nine months 2024,

•lower fair value gains on trading securities, which primarily consist of Puerto Rico contingent value instruments (CVIs) in nine months 2025,

•net realized investment losses in nine months 2025 primarily due to changes in the allowance for credit losses for alternative investments and Loss Mitigation Securities and realized losses on sales of securities, and

•lower net earned premiums in nine months 2025, compared with nine months 2024 due to lower refundings of financial guaranty insurance exposures.

The Company’s effective tax rate reflects the proportion of income recognized by each of the Company’s operating subsidiaries in the jurisdiction in which they are taxed, with U.S. subsidiaries and foreign subsidiaries that have made an election to be a U.S. taxpayer 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

Adjusted Operating Income

Adjusted operating income in third quarter 2025 was $124 million, compared with $130 million in third quarter 2024. The decrease was primarily due to a lower benefit in loss expense for U.S. RMBS sector in third quarter 2025, partially offset by higher income from investment portfolio. See “— Results of Operations — Reconciliation to GAAP” for the reconciliation of net income (loss) attributable to AGL to adjusted operating income (loss).

Adjusted operating income in nine months 2025 was $336 million, compared with $323 million in nine months 2024. The increase was primarily due to the gain related to the resolution of the LBIE litigation in 2025, and higher equity in earnings and net investment income in nine months 2025, offset in part by a higher loss expense in public finance sectors, lower fair value gains on the trading portfolio and lower earned premiums on refundings of financial guaranty insurance contracts in nine months 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 as of September 30, 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. Adjusted operating shareholders’ equity and ABV decreased primarily due to share repurchases and dividends, partially offset by adjusted operating income and GWP. 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 September 30, 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.