Assured Guaranty results paint mixed picture

Assured Guaranty has announced that it made a profit of $88 million in the fourth quarter of 2018, an increase on the $52 million it made in the same quarter of 2017.

However, the company posted a year-end net income for 2018 of $521 million, a fall of 29.7 percent from the $730 million it recorded for 2017.

According to the company the reason that net income for 2017 was higher was primarily due to $402 million in after-tax gains attributable to commutations, the acquisition of MBIA UK Insurance, and R&W settlements.

Excluding these items, Assured Guaranty said that net income increased in full year 2018 compared with full year 2017 mainly due to a lower effective tax rate and lower loss and LAE, offset in part by lower net earned premiums, foreign exchange remeasurement losses, net realized investment losses and losses on the repurchase of debt.

“Assured Guaranty continued to be the leading financial guarantor in 2018, successfully executing on its strategic priorities while maintaining its strong financial position and creating more shareholder value,” said Dominic Frederico, president and CEO.

“By writing new business in all of our financial guaranty markets - U.S. public finance, international infrastructure finance and structured finance - and additionally reinsuring the preponderance of a legacy guarantor’s insured portfolio, we drove a 129 percent year-over-year increase in PVP to bring our new business production to a level not seen since 2008.”