Assured Guaranty posts solid Q2 results despite economic challenges

Bermuda-based financial guaranty insurer Assured Guaranty posted some of its strongest results ever in the second quarter of the year despite what the company called unprecedented economic and market conditions.

The company posted a net profit of $183 million in the quarter compared with $142 million in the same period a year earlier. Its insurance unit generated gross written premiums reached $149 million in Q2 compared. The company’s total revenues reached $246 million, compared with $241 million in the same period a year earlier.

It also revealed some management changes. Andrew Feldstein has decided to leave Assured Guaranty and its subsidiary BlueMountain Capital Management. David Buzen, deputy chief investment officer at BlueMountain, has been appointed CEO and chief investment officer of BlueMountain and head of asset management and chief investment officer at Assured Guaranty.

“During these unprecedented economic and market conditions, Assured Guaranty achieved its strongest second-quarter result for direct new insurance business production since the acquisition of AGM in July 2009, writing 71% more PVP than in last year’s second quarter,” said Dominic Frederico, president and CEO.

“We generated premiums in each of our insurance product lines - U.S. public finance, international infrastructure and structured finance. Along with our continued capital management program, this helped drive our adjusted book value above $100 per share for the first time in our history.

“We believe that we are well positioned to withstand the potential financial stress that could result from the pandemic, based on our low insured leverage, granular and diversified insured portfolio, strong liquidity position and significant excess capital. S&P Global Ratings concurred on July 16th, when it reaffirmed the financial strength ratings of our insurance subsidiaries at AA with a Stable Outlook, citing our ‘excellent capital and earnings,’ ‘exceptional’ liquidity, ‘very strong competitive position,’ and increased opportunities for new business underwriting.”