Assured Guaranty turns around 2022 loss to $125m Q2 profit

Leading surety insurer Assured Guaranty turned a $125 million profit in the second quarter as it saw improvements in new business and benefited from improved investing conditions.

Bermuda-based AGL suffered a $40 million loss in the second quarter of 2022.

Net earned premiums edged up to $85 million from $82 million while net investment income jumped from $62 million to $89 million. The company also record a fair value gain of $91 million on credit derivatives, up from $9 million in the prior year quarter.

Chief executive officer Dominic Frederico said the company had seen strong performances in new business production in the quarter.    

“First half gross written premium and present value of new production (PVP) were $181 million and $203 million, respectively,” he said. “First half GWP is the fifth largest first half GWP since 2009, while first half PVP is the second largest amount of first half PVP and the second time that first half PVP exceeded $200 million since 2009.

“For US public finance, our share of the first half insured primary municipal bond market was 63%, up from 56% in the first half of 2022, and total insured market penetration increased to 9.0%”
Frederico noted AGL had completed its transaction with Sound Point Capital Management involving AssuredIM, taking a 30% interest in the new combined entity and, separately, sold its entire equity interest in Assured Healthcare Partners, and will remain a strategic investor in certain AHP-managed funds.

“Both transactions further our strategic objectives in the asset management sector and alternative investments,” he said.

AGL also took $40 million in losses compared to a benefit of $11 million in 2022 while employee compensation and other operating expenses jumped to $141 million from $100 million.