ASSURED GUARANTY LTD - FORM 8-K - EX-99.2 - EXHIBIT

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8-K - 8-K - ASSURED GUARANTY LTD	a8-k1q2013agl.htm
EX-99.1 - EXHIBIT - ASSURED GUARANTY LTD	agl1q13pressrelease.htm

Assured Guaranty Ltd.

March 31, 2013

Financial Supplement



Table of Contents		Page
	Selected Financial Highlights	1
	Consolidated Statements of Operations (unaudited)	2
	Net Income (Loss) Reconciliation to Operating Income	3
	Consolidated Balance Sheets (unaudited)	4
	Adjusted Book Value	5
	Claims Paying Resources	6
	New Business Production	7
	Financial Guaranty Gross Par Written	8
	New Business Production by Quarter	9
	Available-for-Sale Investment Portfolio and Cash	10
	Estimated Net Exposure Amortization and Estimated Future Net Premium and Credit Derivative Revenues	11
	Expected Amortization of Net Par Outstanding	12
	Present Value of Financial Guaranty Insurance Net Expected Loss to be Expensed	13
	Financial Guaranty Profile	14
	Direct Pooled Corporate Obligations Profile	18
	Consolidated U.S. RMBS Profile	19
	Direct U.S. RMBS Profile	20
	Direct U.S. Commercial Real Estate Profile	22
	Direct U.S. Consumer Receivables Profile	23
	Below Investment Grade Exposures	24
	Largest Exposures by Sector	29
	Rollforward of Net Expected Loss and Loss Adjustment Expenses to be Paid	33
	Financial Guaranty Insurance and Credit Derivative U.S. RMBS Representations and Warranties Benefit Development	34
	Losses Incurred	35
	Summary Financial and Statistical Data	36
	Glossary	37
	Non-GAAP Financial Measures	40

This financial supplement should be read in conjunction with documents filed by Assured Guaranty Ltd. (‘‘AGL’’ and, together with its subsidiaries, ‘‘Assured Guaranty’’ or the ‘‘Company’’) with the Securities and Exchange Commission (‘‘SEC’’), including its Annual Report on Form 10-K for the year ended December 31, 2012 and its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2013.

Some amounts in this financial supplement may not add due to rounding.

Cautionary Statement Regarding Forward Looking Statements:

Any forward looking statements made in this supplement reflect the current views of Assured Guaranty with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. Assured Guaranty's forward looking statements could be affected by many events. These events include (1) rating agency action, including a ratings downgrade, a change in outlook, the placement of ratings on watch for downgrade, or a change in rating criteria, at any time, of Assured Guaranty or any of its subsidiaries and/or of transactions that Assured Guaranty’s subsidiaries have insured; (2) developments in the world’s financial and capital markets, including changes in interest and foreign exchange rates, that adversely affect the demand for the Company's insurance, issuers’ payment rates, Assured Guaranty’s loss experience, its exposure to refinancing risk in transactions (which could result in substantial liquidity claims on its guarantees), its access to capital, its unrealized (losses) gains on derivative financial instruments or its investment returns; (3) changes in the world’s credit markets, segments thereof or general economic conditions; (4) the impact of rating agency action with respect to sovereign debt and the resulting effect on the value of securities in the Company's investment portfolio and collateral posted by and to the Company; (5) more severe or frequent losses impacting the adequacy of Assured Guaranty’s expected loss estimates; (6) the impact of market volatility on the mark-to-market of Assured Guaranty’s contracts written in credit default swap form; (7) reduction in the amount of insurance opportunities available to Assured Guaranty; (8) deterioration in the financial condition of Assured Guaranty's reinsurers, the amount and timing of reinsurance recoverables actually received and the risk that reinsurers may dispute amounts owed to Assured Guaranty under its reinsurance agreements; (9) failure of Assured Guaranty to realize insurance loss recoveries or damages expected from originators, sellers, sponsors, underwriters or servicers of residential mortgage-backed securities transactions through loan putbacks, settlement negotiations or litigation; (10) the possibility that budget shortfalls or other factors will result in credit losses or impairments on obligations of state and local governments that the Company insures or reinsures; (11) increased competition, including from new entrants into the financial guaranty industry; (12) changes in applicable accounting policies or practices; (13) changes in applicable laws or regulations, including insurance and tax laws; (14) other governmental actions; (15) difficulties with the execution of Assured Guaranty’s business strategy; (16) contract cancellations; (17) loss of key personnel; (18) adverse technological developments; (19) the effects of mergers, acquisitions and divestitures; (20) natural or man-made catastrophes; (21) other risks and uncertainties that have not been identified at this time; (22) management’s response to these factors; and (23) other risk factors identified in Assured Guaranty’s filings with the SEC. Readers are cautioned not to place undue reliance on these forward looking statements, which speak only as of the dates on which they are made. Assured Guaranty undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Assured Guaranty Ltd.

Selected Financial Highlights

(dollars in millions, except per share amounts)



			Three Months Ended
			March 31,
			2013			2012
Operating income reconciliation:
	Operating income		$	260		$	71
	Plus after-tax adjustments:
		Realized gains (losses) on investments	19			(1		)
		Non-credit impairment unrealized fair value gains (losses) on credit derivatives	(434		)	(517		)
		Fair value gains (losses) on committed capital securities	(6		)	(9		)
		Foreign exchange gains (losses) on remeasurement of premiums receivable and loss and loss adjustment expense ("LAE") reserves	(11		)	7
		Effect of consolidating financial guaranty variable interest entities ("FG VIEs")	28			(34		)
	Net income (loss)		$	(144	)	$	(483	)


Earnings per diluted share:
	Operating income		$	1.34		$	0.38
	Plus after-tax adjustments:
		Realized gains (losses) on investments	0.10			—
		Non-credit impairment unrealized fair value gains (losses) on credit derivatives	(2.24		)	(2.83		)
		Fair value gains (losses) on committed capital securities	(0.03		)	(0.05		)
		Foreign exchange gains (losses) on remeasurement of premiums receivable and loss and LAE reserves	(0.06		)	0.04
		Effect of consolidating FG VIEs	0.14			(0.19		)
	Net income (loss)		$	(0.74	)	$	(2.65	)

		Effective tax rate on operating income	25.8		%	17.9		%
		Effective tax rate on net income	31.8		%	30.6		%

Return on equity ("ROE") calculations ⁽¹⁾:
	ROE, excluding unrealized gain (loss) on investment portfolio		(13.1		)%	(47.3		)%
	Operating ROE		17.5		%	5.4		%

New business:
		Gross par written	$	1,594		$	4,881
		Present value of new business production ("PVP") ⁽²⁾	$	18		$	56

			As of
			March 31,			December 31,
Other information:			2013			2012
		Net debt service outstanding	$	751,741		$	782,180
		Net par outstanding	501,817			519,893
		Claims paying resources ⁽³⁾	11,999			12,328

1) Quarterly ROE calculations represent annualized returns.

2) Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

3) See page 6 for additional detail on claims paying resources.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Consolidated Statements of Operations (unaudited)

(dollars in millions, except per share amounts)



				Three Months Ended
				March 31,
				2013			2012
Revenues:
	Net earned premiums			$	248		$	194
	Net investment income			94			98
	Net realized investment gains (losses)			28			1
	Net change in fair value of credit derivatives:
		Realized gains (losses) and other settlements		18			(57		)
		Net unrealized gains (losses)		(610		)	(634		)
			Net change in fair value of credit derivatives	(592		)	(691		)
	Fair value gains (losses) on committed capital securities			(10		)	(14		)
	Fair value gains (losses) on FG VIEs			70			(41		)
	Other income			(14		)	91
		Total revenues		(176		)	(362		)

Expenses:
	Loss and loss adjustment expenses			(48		)	242
	Amortization of deferred acquisition costs			3			5
	Interest expense			21			25
	Other operating expenses			60			62
		Total expenses		36			334

Income (loss) before income taxes				(212		)	(696		)
	Provision (benefit) for income taxes			(68		)	(213		)
Net income (loss)				$	(144	)	$	(483	)

Less after-tax adjustments:
	Realized gains (losses) on investments			19			(1		)
	Non-credit impairment unrealized fair value gains (losses) on credit derivatives			(434		)	(517		)
	Fair value gains (losses) on committed capital securities			(6		)	(9		)
	Foreign exchange gains (losses) on remeasurement of premiums receivable and loss and LAE reserves			(11		)	7
	Effect of consolidating FG VIEs			28			(34		)
Operating income				$	260		$	71

Weighted average shares outstanding
	Basic shares outstanding			193.9			182.4
	Diluted shares outstanding ⁽¹⁾			193.9			182.4
	Shares outstanding at the end of period ⁽²⁾			192.3			182.5

Effect of refundings and terminations, net
	Net earned premiums from refundings and terminations			$	113		$	37
	Operating income effect			64			24
	Operating income per diluted share effect			0.33			0.13

1) Non-GAAP diluted shares outstanding were 194.6 million and 186.2 million for the three months ended March 31, 2013 and 2012, respectively.

2) On June 1, 2012, AGL issued 13.4 million common shares in connection with the 3,450,000 equity units it issued in June 2009. Each of the equity units included a forward purchase contract under which the holders were required to purchase such common shares for an aggregate purchase price of $173 million. As a result of the settlement of the forward purchase contracts, the equity units ceased to exist.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Net Income (Loss) Reconciliation to Operating Income

(dollars in millions)



				Three Months Ended											Three Months Ended
				March 31, 2013											March 31, 2012
				GAAP Income As Reported			Less: Operating Income Adjustments					Non-GAAP Operating Income Results			GAAP Income As Reported			Less: Operating Income Adjustments					Non-GAAP Operating Income Results
Revenues:
	Net earned premiums			$	248		$	(18	)	(1	)	$	266		$	194		$	(17	)	(1	)	$	211
	Net investment income			94			0			(1	)	94			98			2			(1	)	96
	Net realized investment gains (losses)			28			29			(2	)	(1		)	1			(1		)	(2	)	2
	Net change in fair value of credit derivatives:
		Realized gains (losses) and other settlements		18			18					—			(57		)	(57		)			—
		Net unrealized gains (losses)		(610		)	(610		)			—			(634		)	(634		)			—
		Credit derivative revenues		—			(28		)			28			—			(29		)			29
			Net change in fair value of credit derivatives	(592		)	(620		)	(3	)	28			(691		)	(720		)	(3	)	29
	Fair value gains (losses) on committed capital securities			(10		)	(10		)	(4	)	—			(14		)	(14		)	(4	)	—
	Fair value gains (losses) on FG VIEs			70			70			(1	)	—			(41		)	(41		)	(1	)	—
	Other income			(14		)	(17		)	(5	)	3			91			3			(5	)	88
		Total revenues		(176		)	(566		)			390			(362		)	(788		)			426

Expenses:
	Loss and loss adjustment expenses:
		Financial guaranty insurance		(48		)	7			(1	)	(55		)	242			(7		)	(1	)	249
		Credit derivatives		—			(10		)	(3	)	10			—			2			(3	)	(2		)
	Amortization of deferred acquisition costs			3			—					3			5			—					5
	Interest expense			21			—					21			25			—					25
	Other operating expenses			60			—					60			62			—					62
		Total expenses		36			(3		)			39			334			(5		)			339

Income (loss) before income taxes				(212		)	(563		)			351			(696		)	(783		)			87
	Provision (benefit) for income taxes			(68		)	(159		)	(6	)	91			(213		)	(229		)	(6	)	16
Net income (loss)				$	(144	)	$	(404	)			$	260		$	(483	)	$	(554	)			$	71


1)	Adjustments primarily related to elimination of the effects of consolidating FG VIEs.


2)	Adjustments to eliminate realized gains (losses) on available-for-sale investments.


3)	Adjustments to eliminate non-economic fair value gains (losses) on credit derivatives and reclassification to revenues and loss expense.


4)	Adjustments to eliminate fair value gain (loss) on committed capital securities.


5)	Adjustments primarily related to elimination of foreign exchange gains (losses) on remeasurement of premiums receivable and loss and LAE reserves.


6)	Tax effect of the above adjustments.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Consolidated Balance Sheets (unaudited)

(dollars in millions)



		As of:
		March 31,		December 31,
		2013		2012
Assets:
	Investment portfolio:
	Fixed maturity securities, available-for-sale, at fair value	$	9,985	$	10,056
	Short-term investments, at fair value	729		817
	Other invested assets	148		212
	Total investment portfolio	10,862		11,085

	Cash	125		138
	Premiums receivable, net of ceding commissions payable	956		1,005
	Ceded unearned premium reserve	535		561
	Deferred acquisition costs	116		116
	Reinsurance recoverable on unpaid losses	56		58
	Salvage and subrogation recoverable	543		456
	Credit derivative assets	125		141
	Deferred tax asset, net	872		721
	FG VIE assets, at fair value	2,813		2,688
	Other assets	296		273
Total assets		$	17,299	$	17,242

Liabilities and shareholders' equity:
Liabilities:
	Unearned premium reserve	$	4,982	$	5,207
	Loss and loss adjustment expense reserve	532		601
	Reinsurance balances payable, net	193		219
	Long-term debt	832		836
	Credit derivative liabilities	2,518		1,934
	FG VIE liabilities with recourse, at fair value	2,071		2,090
	FG VIE liabilities without recourse, at fair value	1,107		1,051
	Other liabilities	340		310
Total liabilities		12,575		12,248

Shareholders' equity:
	Common stock	2		2
	Additional paid-in capital	2,685		2,724
	Retained earnings	1,586		1,749
	Accumulated other comprehensive income	447		515
	Deferred equity compensation	4		4
Total shareholders' equity		4,724		4,994
Total liabilities and shareholders' equity		$	17,299	$	17,242

Assured Guaranty Ltd.

Adjusted Book Value

(dollars in millions, except per share amounts)



			As of:
			March 31, 2013						December 31, 2012
			Total			Per Share			Total			Per Share
Reconciliation of shareholders' equity to adjusted book value:
	Shareholders' equity		$	4,724		$	24.56		$	4,994		$	25.74
	Less after-tax adjustments:
		Effect of consolidating FG VIEs	(322		)	(1.67		)	(348		)	(1.79		)
		Non-credit impairment unrealized fair value gains (losses) on credit derivatives	(1,447		)	(7.52		)	(988		)	(5.09		)
		Fair value gains (losses) on committed capital securities	17			0.09			23			0.12
		Unrealized gain (loss) on investment portfolio excluding foreign exchange effect	421			2.18			477			2.45
	Operating shareholders' equity		$	6,055		31.48			$	5,830		30.05
	After-tax adjustments:
		Less: Deferred acquisition costs	163			0.85			165			0.85
		Plus: Net present value of estimated net future credit derivative revenue	201			1.04			220			1.14
		Plus: Net unearned premium reserve on financial guaranty contracts in excess of expected loss to be expensed	3,125			16.25			3,266			16.83
	Adjusted book value		$	9,218		$	47.92		$	9,151		$	47.17

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Claims Paying Resources

(dollars in millions)



		As of March 31, 2013
		Assured Guaranty Municipal Corp.			Assured Guaranty Corp.			Assured Guaranty Re Ltd. ⁽¹⁾			Municipal Assurance Corp.⁽²⁾		Eliminations⁽³⁾			Consolidated
Claims paying resources
Policyholders' surplus		$	1,869		$	913		$	1,133		$	77	$	(300	)	$	3,692
Contingency reserve		1,599			857			—			—		—			2,456
	Qualified statutory capital	3,468			1,770			1,133			77		(300		)	6,148
Unearned premium reserve		1,991			735			960			—		—			3,686
Loss and LAE reserves ^{(4) (5)}		(175		)	306			209			—		—			340
	Total policyholders' surplus and reserves	5,284			2,811			2,302			77		(300		)	10,174
Present value of installment premium ⁽⁵⁾		440			306			244			—		—			990
Standby line of credit/stop loss		200			200			—			—		—			400
Excess of loss reinsurance facility		435			435			—			—		(435		)	435
	Total claims paying resources	$	6,359		$	3,752		$	2,546		$	77	$	(735	)	$	11,999

Net par outstanding ⁽⁶⁾		$	270,132		$	90,741		$	118,481		$	—	$	(1,433	)	$	477,921
Net debt service outstanding ⁽⁶⁾		407,400			133,472			188,498			—		(3,393		)	725,977

Ratios:
	Net par outstanding to qualified statutory capital	78		:1	51		:1	105		:1	N/A					78		:1
Capital ratio ⁽⁷⁾		117		:1	75		:1	166		:1	N/A					118		:1
Financial resources ratio ⁽⁸⁾		64		:1	36		:1	74		:1	N/A					61		:1


1)	Assured Guaranty Re Ltd. ("AG Re") numbers represent the Company's estimate of U.S. statutory accounting practices prescribed or permitted by insurance regulatory authorities.


2)	Assured Guaranty US Holdings Inc. acquired Municipal and Infrastructure Assurance Corporation, which it has renamed Municipal Assurance Corp. ("MAC"), from Radian Asset Assurance Inc. ("Radian") on May 31, 2012. As of March 31, 2013, MAC has not written any business.


3)	In 2009, Assured Guaranty Corp. ("AGC") issued a $300 million note payable to Assured Guaranty Municipal Corp. ("AGM"). Net par and net debt service outstanding eliminations relate to second-to-pay policies under which an Assured Guaranty insurance subsidiary guarantees an obligation already insured by another Assured Guaranty insurance subsidiary.


4)	Reserves are reduced by approximately $1.3 billion for benefit related to representation and warranty recoverables.


5)	Includes financial guaranty insurance and credit derivatives.

Net par outstanding and net debt service outstanding are presented on a statutory basis. Under statutory accounting, such amounts would be reduced both when an outstanding issue is legally defeased (i.e., an issuer has legally discharged its obligations with respect to a municipal security by satisfying conditions set forth in defeasance provisions contained in transaction documents and is no longer responsible for the payment of debt service with respect to such obligations) and when such issue is economically defeased (i.e., transaction documents for a municipal security do not contain defeasance provisions but the issuer establishes an escrow account with U.S. government securities in amounts sufficient to pay the refunded bonds when due; the refunded bonds are not considered paid and continue to be outstanding under the transaction documents and the issuer remains responsible to pay debt service when due to the extent monies on deposit in the escrow account are insufficient for such purpose).


7)	The capital ratio is calculated by dividing net debt service outstanding by qualified statutory capital.


8)	The financial resources ratio is calculated by dividing net debt service outstanding by total claims paying resources.

Assured Guaranty Ltd.

New Business Production

(dollars in millions)



			Three Months Ended
			March 31,
			2013		2012
Consolidated new business production analysis:
	PVP
	Public finance - U.S.:
		Assumed from Radian	$	—	$	22
		Primary markets	14		27
		Secondary markets	2		3
	Public finance - non-U.S.:
		Primary markets	—		—
		Secondary markets	—		—
	Structured finance - U.S.		2		4
	Structured finance - non-U.S.		—		—
	Total PVP		$	18	$	56


	Total PVP		$	18	$	56
		Less: PVP of credit derivatives	—		—
	PVP of financial guaranty insurance		18		56
		Less: financial guaranty installment premium PVP	1		4
	Total: financial guaranty upfront gross written premiums ("GWP")		17		52
		Plus: financial guaranty installment GWP ⁽¹⁾	—		36
	Total GWP		$	17	$	88


Consolidated financial guaranty gross par written:
	Public finance - U.S.:
		Assumed from Radian	$	—	$	1,797
		Primary markets	1,407		2,902
		Secondary markets	173		144
	Public finance - non-U.S.:
		Primary markets	—		—
		Secondary markets	—		—
	Structured finance - U.S.		14		38
	Structured finance - non-U.S.		—		—
	Total		$	1,594	$	4,881


1)	Represents present value of new business on installment policies plus GWP adjustment on existing installment policies due to changes in assumptions and any cancellations of assumed reinsurance contracts.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Financial Guaranty Gross Par Written

(dollars in millions)

Financial Guaranty Gross Par Written by Asset Type



			Three Months Ended
			March 31, 2013
			Gross Par Written		Avg. Internal Rating
Sector:
U.S. public finance
	General obligation		$	935	A-
	Municipal utilities		174		A-
	Tax backed		229		A
	Healthcare		46		BBB+
	Transportation		196		A
		Total U.S. public finance	1,580		A-
Non-U.S. public finance:
		Total non-U.S. public finance	—		—
Total public finance			$	1,580	A-

U.S. structured finance:
	Other structure finance		$	14	A-
		Total U.S. structured finance	14		A-
Non-U.S. structured finance:
		Total non-U.S. structured finance	—		—
Total structured finance			$	14	A-

Total gross par written			$	1,594	A-

Note: Please refer to the Glossary for a description of internal ratings and sectors.

Assured Guaranty Ltd.

New Business Production by Quarter

(dollars in millions)




		1Q-12		2Q-12			3Q-12			4Q-12		1Q-13
PVP:
Public finance - U.S.:
	Assumed from Radian	$	22	$	—		$	—		$	—	$	—
	Primary markets	27		44			23			31		14
	Secondary markets	3		3			7			6		2
Public finance - non-U.S.:
	Primary markets	—		1			—			—		—
	Secondary markets	—		—			—			—		—
Structured finance - U.S.		4		2			5			32		2
Structured finance - non-U.S.		—		—			—			—		—
Total PVP		$	56	$	50		$	35		$	69	$	18


Total PVP		$	56	$	50		$	35		$	69	$	18
	Less: PVP of credit derivatives	—		—			—			—		—
PVP of financial guaranty insurance		56		50			35			69		18
	Less: financial guaranty installment premium PVP	4		3			5			33		1
Total: financial guaranty upfront GWP		52		47			30			36		17
	Plus: financial guaranty installment GWP⁽¹⁾	36		(16		)	(5		)	73		—
Total GWP		$	88	$	31		$	25		$	109	$	17

Consolidated financial guaranty gross par written⁽²⁾:
Public finance - U.S.:
	Assumed from Radian	$	1,797	$	—		$	—		$	—	$	—
	Primary markets	2,902		4,497			2,507			3,149		1,407
	Secondary markets	144		173			500			492		173
Public finance - non-U.S.:
	Primary markets	—		35			—			—		—
	Secondary markets	—		—			—			—		—
Structured finance - U.S.		38		—			182			400		14
Structured finance - non-U.S.		—		—			—			—		—
	Total	$	4,881	$	4,705		$	3,189		$	4,041	$	1,594


1)	Represents present value of new business on installment policies plus GWP adjustment on existing installment policies due to changes in assumptions and any cancellations of assumed reinsurance contracts.


2)	Includes committed amount including undrawn revolvers.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Assured Guaranty Ltd.

Available-for-Sale Investment Portfolio and Cash

As of March 31, 2013

(dollars in millions)



			Amortized Cost		Pre-Tax Book Yield		After-Tax Book Yield		Fair Value		Annualized Investment Income ⁽¹⁾
Investment portfolio, available-for-sale:
Fixed maturity securities:
	U.S. Treasury securities and obligations of U.S. government agencies		$	502	1.97	%	1.41	%	$	523	10
	Agency obligations		317		3.53	%	2.98	%	354		11
	Foreign government securities		260		2.64	%	1.73	%	270		7
	Obligations of states and political subdivisions		3,814		3.98	%	3.77	%	4,133		152
	Insured obligations of state and political subdivisions⁽²⁾⁽⁴⁾		1,347		4.69	%	4.43	%	1,468		63
	Corporate securities		970		3.41	%	2.82	%	1,040		33
	Mortgage-backed securities ("MBS")⁽³⁾:
		Residential MBS ("RMBS") ⁽⁴⁾	1,347		6.00	%	4.55	%	1,293		81
		Commercial MBS ("CMBS")	474		3.78	%	3.23	%	505		18
	Asset-backed securities		469		6.08	%	4.25	%	496		29
		Total fixed maturity securities	9,500		4.25	%	3.67	%	10,082		404
Short-term investments			723		0.03	%	0.02	%	723		0
Cash ⁽⁵⁾			123		—	%	—	%	123		—
		Total	$	10,346	3.95	%	3.41	%	$	10,928	$	404

Less: FG VIEs			129		11.13	%	7.24	%	89		15

		Total	$	10,217	3.85	%	3.36	%	$	10,839	$	389



Ratings⁽⁶⁾:			Fair Value		% of Portfolio
	U.S. Treasury securities and obligations of U.S. government agencies		$	523	5.2	%
	Agency obligations		354		3.5	%
	AAA/Aaa		1,456		14.4	%
	AA/Aa		5,434		53.9	%
	A/A		1,650		16.4	%
	BBB		29		0.3	%
	Below investment grade ("BIG")⁽⁷⁾		636		6.3	%
		Total fixed maturity securities, available-for-sale	10,082		100.0	%

	Less: FG VIEs		97

		Total fixed maturity securities, available-for-sale	$	9,985


Duration of fixed maturity securities and short-term investments (in years):					4.8

Average ratings of fixed maturity securities and short-term investments					AA-


1)	Represents annualized investment income based on amortized cost and pre-tax book yields.


2)	Reflects obligations of state and local political subdivisions that have been insured by other financial guarantors. The underlying ratings of these bonds, after giving effect to the lower of the rating assigned by Standard & Poor's Ratings Services ("S&P") or Moody's Investors Service, Inc. ("Moody's"), average A+. Includes fair value of $343 million insured by AGC and AGM.


3)	Includes fair value of $121 million in subprime RMBS, which has an average rating of BIG.


4)	Includes securities purchased or obtained as part of loss mitigation or other risk management strategies.


5)	Represents operating cash and is not included in yield calculations.


6)	Ratings are represented by the lower of the Moody's and S&P classifications except for bonds purchased for loss mitigation or risk management strategies which use internal ratings classifications.


7)	Includes below investment grade securities that were purchased or obtained as part of loss mitigation or other risk management strategies of $1,835 million in par with carrying value of $634 million.

Assured Guaranty Ltd.

Estimated Net Exposure Amortization⁽¹⁾ and Estimated Future Net Premium

and Credit Derivative Revenues

(dollars in millions)



						Financial Guaranty Insurance ⁽²⁾
		Estimated Net Debt Service Amortization		Estimated Ending Net Debt Service Outstanding		Expected PV Net Earned Premiums ⁽³⁾		Accretion of Discount		Future Net Premiums Earned		Future Credit Derivative Revenues ⁽⁴⁾		Total

2013 (as of March 31)				$	751,741
2013 Q2		$	16,657	735,084		$	121	$	6	$	127	$	24	$	151
2013 Q3		16,443		718,641		118		6		124		21		145
2013 Q4		15,394		703,247		112		6		118		21		139
2014		66,376		636,871		422		21		443		66		509
2015		57,116		579,755		371		20		391		45		436
2016		44,476		535,279		338		18		356		34		390
2017		44,831		490,448		303		17		320		26		346

2013-2017		261,293		490,448		1,785		94		1,879		237		2,116
2018-2022		164,226		326,222		1,164		65		1,229		70		1,299
2023-2027		129,551		196,671		732		44		776		42		818
2028-2032		90,192		106,479		437		26		463		35		498
After 2032		106,479		—		414		21		435		35		470
	Total	$	751,741			$	4,532	$	250	$	4,782	$	419	$	5,201


1)	Represents the future expected amortization of current debt service outstanding (principal and interest), assuming no advance refundings, as of March 31, 2013. Actual amortization differs from expected maturities because borrowers may have the right to call or prepay guaranteed obligations and because of management's assumptions on structured finance amortization.


2)	See page 13 for ‘‘Present Value of Financial Guaranty Insurance Net Expected Loss to be Expensed.’’


3)	GAAP basis. Excludes $244 million in expected present value of net earned premiums related to FG VIEs.


4)	Excludes contracts with credit impairment.

Assured Guaranty Ltd.

Expected Amortization of Net Par Outstanding

(dollars in millions)

Structured Finance



		Estimated Net Par Amortization
		U.S. and Non-U.S. Pooled Corporate		U.S. RMBS		Financial Products ⁽¹⁾		Other Structured Finance		Total		Estimated Ending Net Par Outstanding

2013 (as of March 31)												$	88,294
2013 (April 1- December 31)		$	8,424	$	2,378	$	496	$	1,068	$	12,366	75,928
2014		17,044		2,833		460		1,847		22,184		53,744
2015		9,907		2,650		249		2,748		15,554		38,190
2016		4,238		2,193		146		1,349		7,926		30,264
2017		7,318		1,621		71		1,108		10,118		20,146

2013-2017		46,931		11,675		1,422		8,120		68,148		20,146
2018-2022		2,047		3,522		337		3,365		9,271		10,875
2023-2027		439		1,033		294		1,896		3,662		7,213
2028-2032		404		294		615		718		2,031		5,182
After 2032		2,480		562		648		1,492		5,182		—
	Total structured finance	$	52,301	$	17,086	$	3,316	$	15,591	$	88,294

Public Finance



		Estimated Net Par Amortization		Estimated Ending Net Par Outstanding

2013 (as of March 31)				$	413,523
2013 (April 1-December 31)		$	20,268	393,255
2014		24,520		368,735
2015		23,364		345,371
2016		19,597		325,774
2017		18,826		306,948

2013-2017		106,575		306,948
2018-2022		88,847		218,101
2023-2027		80,585		137,516
2028-2032		60,535		76,981
After 2032		76,981		—
	Total public finance	$	413,523

Net par outstanding (end of period)



		1Q-12		2Q-12		3Q-12		4Q-12		1Q-13
Public finance - U.S.		$	416,499	$	409,877	$	399,176	$	387,967	$	378,456
Public finance - non-U.S.		39,913		38,769		38,720		37,540		35,067
Structured finance - U.S.		87,784		83,430		78,504		74,695		70,280
Structured finance - non-U.S.		22,902		20,858		19,993		19,691		18,014
	Total	$	567,098	$	552,934	$	536,393	$	519,893	$	501,817


1)	See Glossary for description of financial products.

Assured Guaranty Ltd.

Present Value ("PV") of Financial Guaranty Insurance Net Expected Loss to be Expensed

As of March 31, 2013

(dollars in millions)



		Net Expected Loss to be Expensed ⁽¹⁾
		Operating⁽²⁾		GAAP⁽²⁾

2013 Q2		$	22	$	18
2013 Q3		21		16
2013 Q4		20		16
2014		68		50
2015		58		43
2016		49		37
2017		44		34

2013-2017		282		214
2018-2022		152		122
2023-2027		73		60
2028-2032		37		28
After 2032		29		19
	Total expected PV of net expected loss to be expensed	573		443
Discount		375		333
	Total future value	$	948	$	776


1)	The expected present value of net loss to be expensed is discounted by weighted-average risk free rates ranging from 0.0% to 3.72% for U.S. dollar denominated obligations.


2)	Operating income includes net expected loss to be expensed on consolidated FG VIEs. Losses on consolidated FG VIEs are eliminated for GAAP.

Assured Guaranty Ltd.

Financial Guaranty Profile (1 of 4)

(dollars in millions)

Net Par Outstanding and Average Rating by Asset Type



			March 31, 2013			December 31, 2012
			Net Par Outstanding		Avg. Internal Rating	Net Par Outstanding		Avg. Internal Rating
U.S. public finance:
	General obligation		$	166,316	A+	$	169,985	A+
	Tax backed		72,339		A+	73,787		A+
	Municipal utilities		60,450		A	62,116		A
	Transportation		32,278		A	33,799		A
	Healthcare		17,165		A	17,838		A
	Higher education		15,620		A+	15,770		A+
	Housing		4,319		AA-	4,633		AA-
	Infrastructure finance		4,204		BBB	4,210		BBB
	Investor-owned utilities		1,052		A-	1,069		A-
	Other public finance		4,713		A	4,760		A
		Total U.S. public finance	378,456		A	387,967		A
Non-U.S. public finance:
	Infrastructure finance		14,944		BBB	15,812		BBB
	Regulated utilities		11,329		BBB+	12,494		BBB+
	Pooled infrastructure		3,006		AA-	3,200		AA-
	Other public finance		5,788		A	6,034		A
		Total non-U.S. public finance	35,067		BBB+	37,540		BBB+
Total public finance			$	413,523	A	$	425,507	A

U.S. structured finance:
	Pooled corporate obligations		$	38,884	AAA	$	41,886	AAA
	RMBS		17,086		BB+	17,827		BB+
	CMBS and other commercial real estate related exposures		4,152		AAA	4,247		AAA
	Financial products		3,316		AA-	3,653		AA-
	Consumer receivables		2,313		BBB+	2,369		BBB+
	Insurance securitizations		2,190		A+	2,190		A+
	Commercial receivables		959		BBB+	1,025		BBB+
	Structured credit		314		B	319		CCC+
	Other structured finance		1,066		A-	1,179		BBB+
		Total U.S. structured finance	70,280		AA-	74,695		AA-

Non-U.S. structured finance:
	Pooled corporate obligations		13,417		AAA	14,813		AAA
	Commercial receivables		1,405		A-	1,463		A-
	RMBS		1,337		AA-	1,424		AA-
	Insurance securitizations		923		CCC-	923		CCC-
	Structured credit		495		BBB	591		BBB
	CMBS and other commercial real estate related exposures		60		AAA	100		AAA
	Other structured finance		377		Super Senior	377		Super Senior
		Total non-U.S. structured finance	18,014		AA	19,691		AA
Total structured finance			$	88,294	AA-	$	94,386	AA-

Total net par outstanding			$	501,817	A+	$	519,893	A+

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Financial Guaranty Profile (2 of 4)

As of March 31, 2013

(dollars in millions)

Distribution by Ratings of Financial Guaranty Portfolio



		Public Finance - U.S.				Public Finance - Non-U.S.				Structured Finance - U.S.				Structured Finance - Non-U.S.				Consolidated
Ratings:		Net Par Outstanding		%		Net Par Outstanding		%		Net Par Outstanding		%		Net Par Outstanding		%		Net Par Outstanding		%
Super senior		$	—	—	%	$	1,071	3.1	%	$	13,259	18.9	%	$	4,522	25.1	%	$	18,852	3.8	%
AAA		4,053		1.1	%	580		1.7	%	26,628		37.9	%	7,504		41.7	%	38,765		7.7	%
AA		120,812		31.9	%	661		1.9	%	10,041		14.2	%	687		3.8	%	132,201		26.3	%
A		206,112		54.5	%	9,158		26.1	%	3,149		4.5	%	958		5.3	%	219,377		43.7	%
BBB		42,890		11.3	%	21,590		61.5	%	3,351		4.8	%	2,437		13.5	%	70,268		14.0	%
BIG		4,589		1.2	%	2,007		5.7	%	13,852		19.7	%	1,906		10.6	%	22,354		4.5	%
	Total net par outstanding	$	378,456	100.0	%	$	35,067	100.0	%	$	70,280	100.0	%	$	18,014	100.0	%	$	501,817	100.0	%

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Financial Guaranty Profile (3 of 4)

As of March 31, 2013

(dollars in millions)

Geographic Distribution of Financial Guaranty Portfolio



			Net Par Outstanding		% of Total
U.S.:
Public finance
	California		$	57,138	11.4	%
	Pennsylvania		30,631		6.1	%
	New York		30,327		6.0	%
	Texas		28,628		5.7	%
	Illinois		24,658		4.9	%
	Florida		23,396		4.7	%
	New Jersey		15,724		3.1	%
	Michigan		15,370		3.1	%
	Georgia		9,825		2.0	%
	Ohio		9,597		1.9	%
	Other states		133,162		26.5	%
		Total public finance	378,456		75.4	%
	Structured finance (multiple states)		70,280		14.0	%
		Total U.S.	448,736		89.4	%

Non-U.S.:
	United Kingdom		21,597		4.3	%
	Australia		7,400		1.5	%
	Canada		4,100		0.8	%
	France		3,761		0.7	%
	Italy		2,039		0.4	%
	Other		14,184		2.9	%
		Total non-U.S.	53,081		10.6	%

Total net par outstanding			$	501,817	100.0	%

Assured Guaranty Ltd.

Financial Guaranty Profile (4 of 4)

As of March 31, 2013

(dollars in millions)

Net Economic Exposure to Selected European Countries



			Greece		Hungary		Ireland		Italy		Portugal		Spain		Total
Sovereign and sub-sovereign exposure:
	Public finance		$	—	$	—	$	—	$	978	$	105	$	258	$	1,341
	Infrastructure finance		—		408		23		83		96		164		774
		Total sovereign and sub-sovereign exposure	—		408		23		1,061		201		422		2,115
Non-sovereign exposure:
	Regulated utilities		—		—		—		215		—		8		223
	RMBS		—		205		135		476		—		—		816
	Commercial receivables		—		2		13		61		14		2		92
	Pooled corporate obligations		22		—		177		226		15		498		938
		Total non-sovereign exposure	22		207		325		978		29		508		2,069
		Total	$	22	$	615	$	348	$	2,039	$	230	$	930	$	4,184

		Total BIG	$	—	$	576	$	7	$	2	$	121	$	406	$	1,112

Note: While the Company’s exposures are shown in U.S. dollars, the obligations the Company insures are in various currencies, including U.S. dollars, Euros and British pounds sterling. Included in the tables above is $135 million of reinsurance assumed on a 2004 - 2006 pool of Irish residential mortgages that is part of the Company’s remaining legacy mortgage reinsurance business. One of the residential mortgage-backed securities included in the table above includes residential mortgages in both Italy and Germany, and only the portion of the transaction equal to the portion of the original mortgage pool in Italian mortgages is shown in the table.

Assured Guaranty Ltd.

Direct Pooled Corporate Obligations Profile

As of March 31, 2013

(dollars in millions)

Distribution of Direct Pooled Corporate Obligations by Ratings



			Net Par Outstanding		% of Total		Avg. Initial Credit Enhancement		Avg. Current Credit Enhancement
Ratings:
	Super Senior		$	14,149	27.3	%	30.8	%	30.6	%
	AAA		30,051		57.9	%	29.7	%	30.3	%
	AA		1,941		3.7	%	40.1	%	47.4	%
	A		618		1.2	%	46.4	%	45.0	%
	BBB		1,787		3.5	%	33.9	%	28.7	%
	BIG		3,328		6.4	%	38.7	%	22.9	%
		Total exposures	$	51,874	100.0	%	31.3	%	30.7	%

Distribution of Direct Pooled Corporate Obligations by Asset Class



			Net Par Outstanding		% of Total		Avg. Initial Credit Enhancement		Avg. Current Credit Enhancement		Avg. Rating
Asset class:
	CBOs/CLOs		$	29,749	57.3	%	31.2	%	32.9	%	AAA
	Synthetic investment grade pooled corporates		9,592		18.5	%	21.6	%	19.7	%	AAA
	Market value CDOs of corporates		3,648		7.0	%	29.9	%	31.7	%	AAA
	Synthetic high yield pooled corporates		2,690		5.2	%	47.2	%	41.1	%	AAA
	Trust preferred
		Banks and insurance	2,809		5.4	%	46.2	%	36.6	%	BBB-
		U.S. mortgage and real estate investment trusts	1,889		3.7	%	50.1	%	35.1	%	BB-
		European mortgage and real estate investment trusts	798		1.5	%	36.8	%	34.5	%	BBB-
	Other pooled corporates		699		1.4	%	N/A		N/A		BBB-
		Total exposures	$	51,874	100.0	%	31.3	%	30.7	%	AAA

Note: Please refer to the Glossary for an explanation of internal ratings, performance indicators and sectors.

Assured Guaranty Ltd.

Consolidated U.S. RMBS Profile

As of March 31, 2013

(dollars in millions)

Distribution of U.S. RMBS by Rating and Type of Exposure



Ratings:			Prime First Lien		Closed End Seconds		HELOC		Alt-A First Lien		Option ARMs		Subprime First Lien		Total Net Par Outstanding
	AAA		$	4	$	0	$	59	$	253	$	—	$	2,338	$	2,655
	AA		111		111		132		444		496		1,991		3,287
	A		2		0		239		9		94		122		466
	BBB		43		—		19		267		31		291		651
	BIG		459		340		2,610		3,465		766		2,387		10,027
		Total exposures	$	619	$	452	$	3,059	$	4,439	$	1,387	$	7,130	$	17,086

Distribution of U.S. RMBS by Year Insured⁽¹⁾ and Type of Exposure



Year insured:			Prime First Lien		Closed End Seconds		HELOC		Alt-A First Lien		Option ARMs		Subprime First Lien		Total Net Par Outstanding
	2004 and prior		$	31	$	1	$	227	$	98	$	35	$	1,348	$	1,740
	2005		167		—		691		568		53		213		1,692
	2006		102		194		900		371		182		2,864		4,615
	2007		319		257		1,240		2,229		1,049		2,627		7,720
	2008		—		—		—		1,173		69		77		1,319
		Total exposures	$	619	$	452	$	3,059	$	4,439	$	1,387	$	7,130	$	17,086

Distribution of U.S. RMBS by Rating and Year Insured



Year insured:			AAA Rated			AA Rated			A Rated			BBB Rated			BIG Rated			Total
	2004 and prior		$	1,133		$	80		$	51		$	122		$	354		$	1,740
	2005		137			190			—			38			1,327			1,692
	2006		1,285			1,624			67			115			1,524			4,615
	2007		5			1,393			280			375			5,667			7,720
	2008		95			—			69			—			1,155			1,319
		Total exposures	$	2,655		$	3,287		$	466		$	651		$	10,027		$	17,086

	% of Total		15.6		%	19.2		%	2.7		%	3.8		%	58.7		%	100.0		%


1)	Assured Guaranty has not insured any U.S. RMBS transactions since 2008.

Note: Please refer to the Glossary for a description of performance indicators and sectors.

Assured Guaranty Ltd.

Direct U.S. RMBS Profile (1 of 2)

As of March 31, 2013

(dollars in millions)

Distribution of Direct U.S. RMBS Insured January 1, 2005 or Later by Exposure Type, Average Pool Factor, Subordination, Cumulative Losses and 60+ Day Delinquencies

U.S. Prime First Lien



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	164	28.4	%	4.5	%	2.4	%	12.1	%	6
	2006		102		50.2	%	8.4	%	0.6	%	17.5	%	1
	2007		319		40.3	%	4.8	%	5.9	%	21.4	%	1
	2008		—		—	%	—	%	—	%	—	%	—
		Total	$	585	38.7	%	5.4	%	4.0	%	18.1	%	8

U.S. Closed End Seconds



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	—	—	%	—	%	—	%	—	%	—
	2006		185		12.1	%	—	%	60.0	%	5.8	%	1
	2007		257		14.4	%	—	%	69.7	%	7.2	%	8
	2008		—		—	%	—	%	—	%	—	%	—
		Total	$	442	13.4	%	—	%	65.7	%	6.6	%	9

U.S. HELOC



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	648	14.1	%	3.0	%	17.1	%	12.7	%	6
	2006		883		22.3	%	3.5	%	36.8	%	10.4	%	7
	2007		1,240		36.4	%	2.6	%	32.3	%	6.7	%	9
	2008		—		—	%	—	%	—	%	—	%	—
		Total	$	2,771	26.7	%	3.0	%	30.2	%	9.3	%	22

U.S. Alt-A First Lien



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	566	27.2	%	8.4	%	7.3	%	19.5	%	21
	2006		371		33.1	%	0.0	%	20.6	%	38.9	%	7
	2007		2,229		41.3	%	1.4	%	16.5	%	30.5	%	12
	2008		1,173		39.2	%	16.4	%	15.9	%	27.8	%	5
		Total	$	4,339	38.2	%	6.2	%	15.5	%	29.0	%	45

Note: Please refer to the Glossary for a description of performance indicators and sectors.

Assured Guaranty Ltd.

Direct U.S. RMBS Profile (2 of 2)

As of March 31, 2013

(dollars in millions)

Distribution of Direct U.S. RMBS Insured January 1, 2005 or Later by Exposure Type, Average Pool Factor, Subordination, Cumulative Losses and 60+ Day Delinquencies

U.S. Option ARMs



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	46	16.9	%	10.9	%	10.4	%	18.9	%	3
	2006		177		35.3	%	—	%	20.6	%	40.6	%	5
	2007		1,049		40.6	%	1.1	%	21.4	%	35.0	%	11
	2008		69		42.9	%	48.4	%	16.0	%	28.6	%	1
		Total	$	1,341	39.2	%	3.7	%	20.6	%	34.8	%	20

U.S. Subprime First Lien



Year insured			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	2005		$	204	35.9	%	20.9	%	8.1	%	30.7	%	4
	2006		2,859		19.0	%	61.4	%	19.2	%	34.3	%	4
	2007		2,627		43.8	%	13.6	%	25.0	%	42.8	%	13
	2008		77		55.2	%	18.2	%	20.7	%	32.3	%	1
		Total	$	5,767	31.4	%	37.6	%	21.5	%	38.0	%	22

Note: Please refer to the Glossary for a description of performance indicators and sectors.

Assured Guaranty Ltd.

Direct U.S. Commercial Real Estate Profile

As of March 31, 2013

(dollars in millions)

Distribution of Direct U.S. CMBS Insured January 1, 2005 or Later by Exposure Type, Internal Rating, Average Pool Factor, Subordination, Cumulative Losses and 60+ Day Delinquencies

U.S. CMBS



Rating:			Net Par Outstanding		Pool Factor		Subordination		Cumulative Losses		60+ Day Delinquencies		Number of Transactions
	Super senior		$	3,073	69.7	%	40.3	%	2.6	%	8.7	%	139
	AAA		308		68.9	%	30.9	%	3.6	%	10.5	%	20
	AA		—		—	%	—	%	—	%	—	%	—
	A		45		18.0	%	37.7	%	2.8	%	0.8	%	1
	BBB		—		—	%	—	%	—	%	—	%	—
	BIG		—		—	%	—	%	—	%	—	%	—
		Total exposures	$	3,426	68.9	%	39.4	%	2.7	%	8.7	%	160

CDOs of U.S. Commercial Real Estate⁽¹⁾



		Net Par Outstanding		% of Total		Avg. Initial Credit Enhancement		Avg. Current Credit Enhancement
CDOs of commericial real estate		$	458	100.0	%	51.1	%	56.2	%
	Total exposures	$	458	100.0	%	51.1	%	56.2	%


1)	Represents other U.S. Commercial Real Estate not included in the table above.

Note: Please refer to the Glossary for a description of performance indicators and sectors.

Assured Guaranty Ltd.

Direct U.S. Consumer Receivables Profile

As of March 31, 2013

(dollars in millions)

Distribution of Direct U.S. Consumer Receivables by Rating



Rating:			Credit Cards		Student Loans		Manufactured Housing		Auto		Total Net Par Outstanding
	Super senior		$	0	$	—	$	—	$	—	0
	AAA		—		392		—		117		509
	AA		—		—		51		12		63
	A		—		—		—		—		—
	BBB		—		869		35		—		904
	BIG		—		—		126		—		126
		Total exposures	$	—	$	1,261	$	212	$	129	$	1,602


Average rating			Super Senior		A-		BB-		AAA		A-
Average initial credit enhancement			N/A		7.2%		27.4%		19.8%		10.9%
Average current credit enhancement			N/A		12.1%		25.6%		32.4%		16.0%

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Below Investment Grade Exposures (1 of 5)

(dollars in millions)

BIG Exposures by Asset Exposure Type



			BIG Net Par Outstanding⁽¹⁾
			March 31, 2013		December 31, 2012
U.S. public finance:
	Infrastructure finance		$	1,695	$	1,695
	General obligation		1,171		1,122
	Municipal utilities		581		596
	Tax backed		476		514
	Transportation		238		245
	Healthcare		57		58
	Higher education		17		18
	Housing		2		2
	Other public finance		352		353
		Total U.S. public finance	4,589		4,603
Non-U.S. public finance:
	Infrastructure finance		1,645		1,923
	Other public finance		362		370
		Total non-U.S. public finance	2,007		2,293
Total public finance			$	6,596	$	6,896

U.S. structured finance:
	RMBS		$	10,027	$	10,605
	Pooled corporate obligations		2,815		2,873
	Consumer receivables		394		421
	Structured credit		314		319
	Commercial receivables		171		182
	Other structured finance		131		132
		Total U.S. structured finance	13,852		14,532
Non-U.S. structured finance:
	Insurance securitizations		923		923
	Pooled corporate obligations		769		805
	RMBS		205		220
	Commercial receivables		9		16
		Total non-U.S. structured finance	1,906		1,964
Total structured finance			$	15,758	$	16,496
Total BIG net par outstanding			$	22,354	$	23,392

Securities purchased for loss mitigation purposes represented $1,119 million and $1,133 million of gross par outstanding as of March 31, 2013 and December 31, 2012, respectively. In addition, under the terms of certain credit derivative contracts, the Company has obtained the obligations referenced in such contracts and recorded it in invested assets in the consolidated balance sheets. Such amounts totaled $219 million and $220 million in gross par outstanding as of March 31, 2013 and December 31, 2012, respectively.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Below Investment Grade Exposures (2 of 5)

(dollars in millions)

Net Par Outstanding by BIG Category⁽¹⁾



				Financial Guaranty Insurance and Credit Derivatives Surveillance Categories⁽²⁾
				March 31, 2013		December 31, 2012
Category 1
	U.S. public finance			$	3,359	$	3,290
	Non-U.S. public finance			983		2,293
	U.S. structured finance			2,604		2,687
	Non-U.S. structured finance			933		984
		Total Category 1		7,879		9,254
Category 2
	U.S. public finance			520		500
	Non-U.S. public finance			1,024		—
	U.S. structured finance			4,319		4,550
	Non-U.S. structured finance			50		57
		Total Category 2		5,913		5,107
Category 3
	U.S. public finance			710		813
	Non-U.S. public finance			—		—
	U.S. structured finance			6,929		7,295
	Non-U.S. structured finance			923		923
		Total Category 3		8,562		9,031
			BIG Total	$	22,354	$	23,392

Assured Guaranty's surveillance department is responsible for monitoring our portfolio of credits and maintains a list of BIG credits. BIG Category 1: Below investment grade transactions showing sufficient deterioration to make lifetime losses possible, but for which none are currently expected. Transactions on which claims have been paid but are expected to be fully reimbursed (other than investment grade transactions on which only liquidity claims have been paid) are in this category. BIG Category 2: Below investment grade transactions for which lifetime losses are expected but for which no claims (other than liquidity claims) have yet been paid. BIG Category 3: Below investment grade transactions for which lifetime losses are expected and on which claims (other than liquidity claims) have been paid. Transactions remain in this category when claims have been paid and only a recoverable remains.

Securities purchased for loss mitigation purposes represented $1,119 million and $1,133 million of gross par outstanding as of March 31, 2013 and December 31, 2012, respectively. In addition, under the terms of certain credit derivative contracts, the Company has obtained the underlying collateral of transactions and recorded it in invested assets in the consolidated balance sheets. Such amounts totaled $219 million and $220 million in gross par outstanding as of March 31, 2013 and December 31, 2012, respectively.

Assured Guaranty Ltd.

Below Investment Grade Exposures (3 of 5)

As of March 31, 2013

(dollars in millions)

Public Finance BIG Exposures Greater Than $50 Million



			Net Par Outstanding		Internal Rating
Name or description
U.S. public finance:
		Skyway Concession Company LLC	$	1,118	BB
		Jefferson County Alabama Sewer	464		D
		Detroit (City of) Michigan	355		BB
		Louisville Arena Authority Inc.	336		BB
		San Joaquin Hills California Transportation	238		BB-
		GMAC Military Housing Trust XVIII (Hickam Air Force Base)	216		BB
		Lackawanna County, Pennsylvania	181		BB-
		Jefferson County Alabama School Sales Tax	169		BB
		Stockton City, California (includes $34.7 million purchased, 22% owned)⁽¹⁾	158		D
		Woonsocket (City of), Rhode Island	152		BB
		Guaranteed Student Loan Transaction	148		B
		Orlando Tourist Development Tax - Florida	118		B+
		Harrisburg (City of) Pennsylvania General Obligation	92		B-
		Rockland County New York	84		BB+
		Xenia Rural Water District, Iowa	79		B
		Guaranteed Student Loan Transaction	54		CCC
		Village of Bridgeview, Cook County, Illinois General Obligation Bonds (Alternate Revenue Source)	51		BB+
	Total		$	4,013

Non-U.S. public finance:
		Reliance Rail Finance Pty. Limited	$	697	BB
		M6 Duna Autopalya Koncesszios Zartkoruen Mukodo Reszvenytarsasag	371		BB
		Cross City Tunnel Motorway Finance Limited	324		BB
		Valencia Fair	247		BB-
		Autovia de la Mancha, S.A.	140		BB-
		Alte Liebe I Limited (Wind Farm)	80		BB
		Metropolitano de Porto Lease and Sublease of Railroad Equipment	56		B+
	Total		$	1,915
Total			$	5,928


1)	Represents amounts of gross par which were purchased or obtained as part of loss mitigation strategies and recorded as part of the investment portfolio.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Below Investment Grade Exposures (4 of 5)

As of March 31, 2013

(dollars in millions)

Structured Finance BIG Exposures Greater Than $50 Million



			Net Par Outstanding		Internal Rating	Current Credit Enhancement	60+ Day Delinquencies
Name or description
U.S. structured finance:
	U.S. RMBS:
		Deutsche Alt-A Securities Mortgage Loan 2007-2	$	619	CCC	0.0%	28.7%
		MABS 2007-NCW (includes $40.0 million purchased, 8% owned)⁽¹⁾	504		B	19.4%	58.0%
		Private Residential Mortgage Transaction	352		CCC	6.0%	27.9%
		Option One 2007-FXD2	349		CCC	9.0%	27.4%
		Countrywide HELOC 2006-I	344		CCC	0.0%	9.1%
		Private Residential Mortgage Transaction	322		B	15.0%	26.4%
		MortgageIT Securities Corp. Mortgage Loan 2007-2	319		B	4.8%	21.4%
		Private Residential Mortgage Transaction	317		CCC	4.2%	25.6%
		Deutsche Alt-A Securities Mortgage Loan 2007-3	316		B	0.9%	22.7%
		Private Residential Mortgage Transaction	295		CCC	—%	31.6%
		Countrywide HELOC 2006-F (includes $85.5 million purchased, 30% owned)⁽¹⁾	282		CCC	0.0%	18.5%
		AAA Trust 2007-2 (includes $103.1 million purchased, 38% owned)⁽¹⁾	274		CCC	11.4%	37.5%
		Nomura Asset Accept. Corp. 2007-1 (includes $0.7 million purchased, 0.2% owned)⁽¹⁾	273		CCC	—%	41.3%
		Private Residential Mortgage Transaction	252		B	11.5%	27.4%
		Countrywide Home Equity Loan Trust 2005-J	220		CCC	0.0%	18.4%
		Countrywide Home Equity Loan Trust 2007-D	212		CCC	0.0%	6.6%
		Countrywide HELOC 2005-D	210		CCC	0.0%	12.3%
		Terwin Mortgage Trust 2006-10SL (includes $141.0 million purchased, 76% owned)⁽¹⁾	185		CCC	—%	5.8%
		Countrywide HELOC 2007-A (includes $16.6 million purchased, 9% owned)⁽¹⁾	181		CCC	0.0%	8.2%
		Soundview 2007-WMC1	177		CCC	—%	65.0%
		Countrywide HELOC 2007-B	166		CCC	0.0%	8.4%
		GMACM 2004-HE3	164		B	0.0%	3.4%
		Private Residential Mortgage Transaction	152		BB	20.9%	31.6%
		New Century 2005-A	151		CCC	15.6%	29.9%
		Renaissance (DELTA) 2007-3 (includes $131.9 million purchased, 91% owned)⁽¹⁾	145		CCC	4.6%	31.3%
		FHABS 2007-HE1 HELOC	133		BB	0.0%	2.0%
		IndyMac 2007-H1 HELOC	130		CCC	0.0%	6.1%
		CSAB 2006-3	117		CCC	0.0%	46.1%
		FHABS 2006-HE2 HELOC	113		BB	0.0%	2.2%
		Countrywide HELOC 2005-C	100		CCC	0.0%	11.9%
		Taylor Bean & Whitaker 2007-2 (includes $23.2 million purchased, 28% owned)⁽¹⁾	82		CCC	0.0%	19.8%
		Soundview Home Loan Trust 2008-1	77		B	18.2%	32.3%
		CSAB 2006-2 (includes $11.2 million purchased, 15% owned)⁽¹⁾	74		CCC	0.0%	39.5%
		American Home Mortgage Assets Trust 2007-4	71		CCC	0.0%	33.4%
		FlagStar HELOC 2005-1	69		BB	26.1%	3.6%
		FlagStar HELOC 2006-2	68		CCC	28.0%	3.4%
		MASTR Asset-Backed Securities Trust 2005-NC2	68		CCC	—%	27.8%
		Lehman Excess Trust 2007-16N	64		CCC	0.0%	39.5%
		CSMC 2007-3 (includes $8.0 million purchased, 13% owned)⁽¹⁾	60		CCC	0.0%	32.6%
		Terwin Mortgage Trust 2005-16HE	60		CCC	—%	30.4%
		Terwin Mortgage Trust 2007-6ALT (100% owned)⁽¹⁾	53		CCC	0.0%	32.9%
		Countrywide HELOC 2006-H (includes $18.5 million purchased, 36% owned)⁽¹⁾	51		CCC	—%	12.5%
		CWALT Alternative Loan Trust 2007-HY9	51		CCC	0.0%	41.1%
		Total U.S. RMBS	$	8,222


1)	Represents amounts of gross par which were purchased or obtained as part of loss mitigation strategies and recorded as part of the investment portfolio.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Below Investment Grade Exposures (5 of 5)

As of March 31, 2013

(dollars in millions)

Structured Finance BIG Exposures Greater Than $50 Million (continued)



			Net Par Outstanding		Internal Rating	Current Credit Enhancement
Name or description
U.S. structured finance:
	Other:
		Taberna Preferred Funding IV, LTD	$	292	CCC	21.7%
		Taberna Preferred Funding III, LTD	287		CCC	16.1%
		Alesco Preferred Funding XVI, LTD.	238		B+	13.8%
		Taberna Preferred Funding II, LTD.	209		CCC	19.9%
		Alesco Preferred Funding XVII, LTD.	184		B+	18.3%
		Attentus CDO I Limited	162		BB	37.6%
		Trapeza CDO XI	155		BB-	38.0%
		Taberna Preferred Funding VI, LTD	152		CCC	20.3%
		US Capital Funding IV, LTD	141		B-	8.5%
		Preferred Term Securities XIX, LTD.	133		BB+	36.8%
		Weinstein Film Securitization	130		CCC	N/A
		Alesco Preferred Funding VII	128		BB+	33.7%
		Alesco Preferred Funding VI	128		BB+	36.0%
		Private Other Non-Municipal Transaction (100% owned)⁽¹⁾	121		B	N/A
		Trapeza CDO X, LTD.	118		BB-	41.5%
		NRG Peaker (100% owned)⁽¹⁾⁽²⁾	116		B	N/A
		Preferred Term Securities XVI, LTD.	112		B+	29.5%
		Taberna Preferred Funding VIII, LTD	111		BB	48.3%
		Taberna Preferred Funding VIII, LTD	106		BB	48.3%
		National Collegiate Trust Series 2007-4	75		CCC	N/A
		America West Airlines Series 2000-1 G-1	72		BB	N/A
		Conseco Finance Manufactured Housing Series 2001-2	71		CCC	15.5%
		National Collegiate Trust Series 2006-2	68		B	N/A
		CAPCO - Excess SIPC Excess of Loss Reinsurance	63		BB	N/A
		Preferred Term Securities XVIII, LTD.	56		BB	36.2%
		GreenPoint 2000-4	55		CCC	6.0%
		National Collegiate Trust Series 2007-3	52		CCC	N/A
		Subtotal other	$	3,535
		Subtotal U.S. structured finance	$	11,757

Non-U.S. structured finance:
		Ballantyne Re Plc (includes $169.8 million purchased, 34% owned)⁽¹⁾	$	500	CC	N/A
		Orkney Re II, Plc	423		CCC	N/A
		Gleneagles Funding LTD (1st Issue)	229		BB	N/A
		FHB 8.95% 2016	117		BB	N/A
		OTP 10% 2012	82		BB+	N/A
		Augusta Funding Limited 07 Perpetual Note Issue	81		BB	N/A
		Private Pooled Corporate Transaction	80		BB	N/A
		Augusta Funding Limited 05 Perpetual Note Issue	79		BB	N/A
		Private Pooled Corporate Transaction	64		BB	N/A
		Private Pooled Corporate Transaction	56		BB	N/A
		Subtotal Non-U.S. structured finance	$	1,711
	Total		$	13,468


1)	Represents amounts of gross par which were purchased or obtained as part of loss mitigation strategies and recorded as part of the investment portfolio.


2)	Net par shown is net of $72 million of ceded par. The Company owns 100% of the collateral in the insured transaction.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Largest Exposures by Sector (1 of 4)

As of March 31, 2013

(dollars in millions)

50 Largest U.S. Public Finance Exposures



Credit names:	Net Par Outstanding		Internal Rating
New Jersey (State of)	$	4,289	A+
California (State of)	3,415		A-
New York (City of) New York	3,226		AA-
Chicago (City of) Illinois	2,650		A+
Massachusetts (Commonwealth of)	2,569		AA
New York (State of)	2,489		A+
Los Angeles California Unified School District	2,263		AA-
Puerto Rico (Commonwealth of)	2,175		BBB-
Miami-Dade County Florida Aviation Authority - Miami International Airport	2,159		A
Houston Texas Water and Sewer Authority	1,982		AA-
Port Authority of New York and New Jersey	1,972		AA-
Philadelphia (City of) Pennsylvania	1,930		BBB
Wisconsin (State of)	1,883		A+
Pennsylvania (Commonwealth of)	1,813		AA-
Washington (State of)	1,795		AA
University of California Board of Regents	1,789		AA
Illinois (State of)	1,722		A-
New York MTA Transportation Authority	1,643		A
Michigan (State of)	1,608		A+
Los Angeles California Department of Water & Power - Electric Revenue Bonds	1,601		AA-
New York City Municipal Water Finance Authority	1,585		AA
Chicago-O'Hare International Airport	1,579		A
Illinois Toll Highway Authority	1,515		AA
Miami-Dade County Florida School Board	1,511		A-
Arizona (State of)	1,466		A+
Long Island Power Authority	1,451		A-
Chicago Illinois Public Schools	1,445		A+
Atlanta Georgia Water & Sewer System	1,411		BBB+
Massachusetts (Commonwealth of) Water Resources	1,366		AA
Georgia Board of Regents	1,320		A
Philadelphia Pennsylvania School District	1,308		A
Metro Washington Airport Authority	1,270		A+
Puerto Rico Highway and Transportation Authority	1,263		BBB
Pennsylvania Turnpike Commission	1,178		A-
California State University System Trustee	1,123		A+
Skyway Concession Company LLC	1,118		BB
District of Columbia	1,110		A+
Kentucky (Commonwealth of)	1,092		A+
North Texas Tollway Authority	1,088		A
New York State Thruway - Highway Trust Fund	1,044		AA-
Detroit Michigan Sewer	1,040		BBB+
New Jersey Turnpike Authority	1,018		A-
New York State Thruway Authority	1,015		A
Louisiana (State of) Gas and Fuel Tax	1,006		AA
San Diego County, California Water	983		AA
Garden State Preservation Trust, New Jersey Open Space & Farmland	960		AA
San Diego California Unified School District	955		AA
Broward County Florida School Board	938		A+
Puerto Rico Electric Power Authority	924		BBB+
Connecticut (State of)	922		A+
Total top 50 U.S. public finance exposures	$	80,977

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Largest Exposures by Sector (2 of 4)

As of March 31, 2013

(dollars in millions)

50 Largest U.S. Structured Finance Exposures



Credit Name		Net Par Outstanding		Internal Rating	Credit Enhancement
	Fortress Credit Opportunities I, LP.	$	1,328	AA	46.9%
	Stone Tower Credit Funding	1,254		AAA	30.2%
	Synthetic Investment Grade Pooled Corporate CDO	1,188		AAA	13.4%
	Synthetic High Yield Pooled Corporate CDO	978		AAA	40.6%
	Synthetic Investment Grade Pooled Corporate CDO	767		Super Senior	14.8%
	Synthetic Investment Grade Pooled Corporate CDO	763		Super Senior	29.0%
	Synthetic Investment Grade Pooled Corporate CDO	745		Super Senior	28.0%
	Synthetic High Yield Pooled Corporate CDO	734		AAA	37.4%
	Synthetic Investment Grade Pooled Corporate CDO	705		Super Senior	22.5%
	Synthetic Investment Grade Pooled Corporate CDO	655		AAA	15.8%
	Deutsche Alt-A Securities Mortgage Loan 2007-2	619		CCC	0.0%
	ARES Enhanced Credit Opportunities Fund	594		AAA	33.3%
	Eastland CLO, LTD	532		Super Senior	39.3%
	Synthetic Investment Grade Pooled Corporate CDO	516		Super Senior	14.3%
	MABS 2007-NCW (includes $40.0 million purchased, 8% owned)⁽¹⁾	504		B	19.4%
	Synthetic High Yield Pooled Corporate CDO	496		AAA	46.7%
	Denali CLO VII, LTD.	486		AAA	19.9%
	Shenandoah Trust Capital I Term Securities	484		A+	N/A
	Churchill Financial Cayman	467		AAA	36.2%
	SLM Private Credit Student Trust 2007-A	450		BBB-	15.9%
	LIICA Holdings, LLC	428		AA	N/A
	KKR Financial CLO 2007-1	409		AAA	52.0%
	Private other structured finance transaction	400		AA	N/A
	Phoenix CLO II	400		AAA	21.9%
	Grayson CLO	399		Super Senior	29.7%
	SLM Private Credit Student Loan Trust 2007-6	392		AAA	4.0%
	Synthetic Investment Grade Pooled Corporate CDO	380		Super Senior	29.2%
	ARES Enhanced Credit Opportunities Fund	369		AAA	33.3%
	Symphony Credit Opportunities Fund	364		AAA	26.5%
	Stone Tower CLO V	362		Super Senior	28.8%
	Synthetic Investment Grade Pooled Corporate CDO	359		Super Senior	14.2%
	SLM Private Credit Student Loan Trust 2006-C	356		BBB-	14.6%
	Private Residential Mortgage Transaction	352		CCC	6.0%
	Option One 2007-FXD2	349		CCC	9.0%
	Muir Grove CLO	345		AAA	21.6%
	Countrywide HELOC 2006-I	344		CCC	0.0%
	Synthetic Investment Grade Pooled Corporate CDO	343		AAA	16.3%
	CENTURION CDO 9	328		AAA	23.1%
	Private Residential Mortgage Transaction	322		B	15.0%
	MortgageIT Securities Corp. Mortgage Loan 2007-2	319		B	4.8%
	Private Residential Mortgage Transaction	317		CCC	4.2%
	Deutsche Alt-A Securities Mortgage Loan 2007-3	316		B	0.9%
	Cent CDO 15 Limited	307		Super Senior	18.4%
	Prudential Closed Block Reinsurance Treaty	300		A+	N/A
	Private Residential Mortgage Transaction	295		CCC	—%
	Cent CDO 12 Limited	293		AAA	23.9%
	CIFC Funding 2006-1	293		AAA	26.3%
	Taberna Preferred Funding IV, LTD	292		CCC	21.7%
	ColumbusNova CLO Ltd. 2006-II	289		AAA	18.6%
	Taberna Preferred Funding III, LTD	288		CCC	16.1%
	Total top 50 U.S. structured finance exposures	$	24,575


1)	Represents amounts of gross par which were purchased or obtained as part of loss mitigation strategies and recorded as part of the investment portfolio.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Largest Exposures by Sector (3 of 4)

As of March 31, 2013

(dollars in millions)

25 Largest Non-U.S. Exposures



Credit Name		Net Par Outstanding		Internal Rating
	Quebec Province	$	2,388	A+
	Sydney Airport Finance Company	1,571		BBB
	Thames Water Utility Finance PLC	1,349		A-
	Channel Link Enterprises Finance PLC	905		BBB
	Southern Gas Networks PLC	814		BBB
	Societe des Autoroutes du Nord et de l'Est de France S.A.	756		BBB+
	Capital Hospitals (Issuer) PLC	726		BBB-
	Campania Region - Healthcare receivable	717		BBB-
	Reliance Rail Finance Pty. Limited	697		BB
	Essential Public Infrastructure Capital II	672		Super Senior
	Southern Water Services Limited	661		A-
	International Infrastructure Pool	645		A-
	International Infrastructure Pool	645		A-
	International Infrastructure Pool	645		A-
	Envestra Limited	560		BBB-
	Synthetic Investment Grade Pooled Corporate CDO	526		Super Senior
	Central Nottinghamshire Hospitals PLC	523		BBB
	Ballantyne Re Plc (includes $169.8 million purchased, 34% owned)⁽¹⁾	500		CC
	Verbund - Lease and Sublease of Hydro-Electric equipment	500		AAA
	NewHospitals (St Helens & Knowsley) Finance PLC	477		BBB
	Scotland Gas Networks Plc (A2)	476		BBB
	A28 Motorway	468		BBB
	DBNGP Finance Co Pty Ltd Note Issue 1 & 2	464		BBB-
	United Utilities Water PLC	462		BBB+
	Broadcast Australia Finance	461		BBB
	Total top 25 non-U.S. exposures	$	18,608


1)	Represents amounts of gross par which were purchased or obtained as part of loss mitigation strategies and recorded as part of the investment portfolio.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Largest Exposures by Sector (4 of 4)

As of March 31, 2013

(dollars in millions)

10 Largest U.S. Residential Mortgage Servicer Exposures



Servicer:		Net Par Outstanding
	Bank of America, N.A.⁽¹⁾	$	3,893
	Ocwen Financial Corporation⁽²⁾	3,361
	Specialized Loan Servicing LLC	2,806
	Wells Fargo Bank N.A.	2,467
	Ally Financial, Inc.⁽³⁾	1,458
	Select Portfolio Servicing, Inc.	677
	JPMorgan Chase Bank	650
	OneWest Bank Group LLC	413
	Carrington Mortgage Services, LLC	327
	First Horizon National Corporation	270
	Total top 10 U.S. residential mortgage servicer exposures	$	16,322

10 Largest U.S. Healthcare Exposures



Credit Name:		Net Par Outstanding		Internal Rating	State
	CHRISTUS Health	$	444	A+	TX
	MultiCare Health System	444		A+	WA
	Methodist Healthcare, TN	373		A	TN
	Catholic Health Partners	333		A+	OH
	Children's National Medical Center (DC)	329		BBB+	DC
	Bon Secours Health System Obligated Group	326		A-	MD
	Carolina HealthCare System	319		AA-	NC
	Iowa Health System	316		A+	IA
	Virtua Health - New Jersey	315		A+	NJ
	Catholic Health Initiatives	295		AA	CO
	Total top 10 U.S. healthcare exposures	$	3,494


1)	Includes Countrywide Home Loans Servicing LP.


2)	Includes Homeward Residential Inc.


3)	Includes GMAC Mortgage LLC, Residential Funding Corp and Homecomings Financial Network, Inc.

Note: Please refer to the Glossary for an explanation of net par outstanding, internal ratings and sectors.

Assured Guaranty Ltd.

Rollforward of Net Expected Loss and LAE to be Paid

(dollars in millions)

Rollforward of Net Expected Loss and LAE to be Paid for the Three Months Ended March 31, 2013



Financial Guaranty Insurance Contracts and Credit Derivatives				Net Expected Loss to be Paid as of December 31, 2012			Economic Loss Development During 1Q-13⁽¹⁾			(Paid) Recovered Losses During 1Q-13			Net Expected Loss to be Paid as of March 31, 2013
U.S. RMBS
	First lien:
		Prime first lien		$	6		$	6		$	(1	)	$	11
		Alt-A first lien		315			9			(11		)	313
		Option ARMs		(131		)	(138		)	(58		)	(327		)
		Subprime first lien		242			25			(4		)	263
			Total first lien	432			(98		)	(74		)	260
	Second lien:
		Closed end seconds		(39		)	1			17			(21		)
		HELOC		(111		)	(3		)	(8		)	(122		)
			Total second lien	(150		)	(2		)	9			(143		)
Total U.S. RMBS				282			(100		)	(65		)	117
TruPS				27			(3		)	(1		)	23
Other structured finance				312			(2		)	(3		)	307
U.S. public finance				7			7			(23		)	(9		)
Non-U.S. public finance				52			10			—			62
			Subtotal	680			(88		)	(92		)	500
Other				(3		)	(10		)	—			(13		)
Total				$	677		$	(98	)	$	(92	)	$	487


1)	Includes the effect of changes in the Company's estimate of future recovery on representations and warranties ("R&W").

Assured Guaranty Ltd.

Financial Guaranty Insurance and Credit Derivative U.S. RMBS R&W Benefit Development

(dollars in millions)

Financial Guaranty Insurance and Credit Derivatives U.S. RMBS Benefit Development for the Three Months Ended March 31, 2013



			Future Net R&W Benefit at December 31, 2012		R&W Economic Loss Development During 1Q-13			R&W Recovered During 1Q-13			Future Net R&W Benefit at March 31, 2013
Financial guaranty insurance:
	Prime first lien		$	4	$	—		$	—		$	4
	Alt-A first lien		158		(1		)	(2		)	155
	Option ARMs		574		151			(54		)	671
	Subprime first lien		109		4			—			113
	Closed end seconds		138		(9		)	(21		)	108
	HELOC		150		17			(6		)	161
		Subtotal	1,133		162			(83		)	1,212

Credit derivatives:
	Alt-A first lien		220		(7		)	(6		)	207
	Option ARMs		17		2			—			19
		Subtotal	237		(5		)	(6		)	226

Total			$	1,370	$	157		$	(89	)	$	1,438

Financial Guaranty Insurance and Credit Derivatives U.S. RMBS Policies with R&W Benefit



			Number of Risks as of		Debt Service as of
			March 31, 2013	December 31, 2012	March 31, 2013		December 31, 2012
Financial guaranty insurance:
	Prime first lien		1	1	$	33	$	35
	Alt-A first lien		21	19	1,384		1,378
	Option ARMs		9	9	598		764
	Subprime first lien		5	5	810		820
	Closed end seconds		4	4	119		196
	HELOC		7	7	518		549
		Subtotal	47	45	3,462		3,742

Credit derivatives:
	Alt-A first lien		7	7	2,545		2,652
	Option ARMs		1	1	328		337
		Subtotal	8	8	2,873		2,989

Total			55	53	$	6,335	$	6,731

Assured Guaranty Ltd.

Losses Incurred

As of March 31, 2013

(dollars in millions)



Financial Guaranty Insurance Contracts and Credit Derivatives				Total Net Par Outstanding for BIG Transactions⁽¹⁾		1Q-13 Losses Incurred			Net Reserve and Credit Impairment			Net Salvage and Subrogation Assets			Net Expected Loss to be Expensed
U.S. RMBS
	First lien:
		Prime first lien		$	459	$	6		$	9		$	—		$	—
		Alt-A first lien		3,465		24			193			—			116
		Option ARMs		766		(90		)	42			377			48
		Subprime first lien		2,387		21			170			0			97
			Total first lien	7,077		(39		)	414			377			261
	Second lien:
		Closed end seconds		340		20			(5		)	51			38
		HELOC		2,610		3			28			193			155
			Total second lien	2,950		23			23			244			193
Total U.S. RMBS				10,027		(16		)	437			621			454
TruPS				2,814		(2		)	13			1			1
Other structured finance				2,917		(14		)	275			4			37
U.S. public finance				4,589		(4		)	71			124			62
Non-U.S. public finance				2,007		1			32			—			19
			Subtotal	22,354		(35		)	828			750			573
Other				—		(10		)	2			5			—
			Subtotal	22,354		(45		)	830			755			573
Effect of consolidating FG VIEs				—		7			(68		)	(262		)	(130		)
Total				$	22,354	$	(38	)	$	762		$	493		$	443



		Insurance Reserves		Credit Impairment on Credit Derivative Contracts ⁽²⁾		Reserve and Credit Impairment		Salvage and Subrogation Recoverable			Net
Gross		$	532	$	287	$	819	$	543		$	276
Ceded		56		1		57		50		(3)	7
	Net	$	476	$	286	$	762	$	493		$	269


1)	As of March 31, 2013, securities purchased for loss mitigation purposes represented $1,119 million of gross par outstanding. In addition, under the terms of certain credit derivative contracts, the Company has obtained the underlying collateral of transactions and recorded it in invested assets in the consolidated balance sheets. Such amounts totaled $219 million in gross par outstanding.


2)	Credit derivative assets and liabilities recorded on the balance sheet considers estimates of expected losses.


3)	Recorded in "reinsurance balances payable, net" on the consolidated balance sheets.

Assured Guaranty Ltd.

Summary Financial and Statistical Data

(dollars in millions, except per share amounts)



						Year Ended December 31,
			As of and for Three Months Ended March 31, 2013			2012			2011		2010		2009
GAAP Summary Income Statement Data
	Net earned premiums		$	248		$	853		$	920	$	1,187	$	930
	Net investment income		94			404			396		361		262
	Realized gains and other settlements on credit derivatives		18			(108		)	6		153		164
	Total expenses		36			822			776		776		808
	Income (loss) before income taxes		(212		)	132			1,029		534		109
	Net income (loss) attributable to Assured Guaranty Ltd.		(144		)	110			773		484		82
	Net income (loss) attributable to Assured Guaranty Ltd. per diluted share		(0.74		)	0.57			4.16		2.56		0.63

GAAP Summary Balance Sheet Data
	Total investments and cash		$	10,987		$	11,223		$	11,314	$	10,849	$	11,013
	Total assets		17,299			17,242			17,709		19,370		16,449
	Unearned premium reserve		4,982			5,207			5,963		6,973		8,381
	Loss and LAE reserve		532			601			679		574		300
	Long-term debt		832			836			1,038		1,053		1,066
	Shareholders’ equity attributable to Assured Guaranty Ltd.		4,724			4,994			4,652		3,670		3,455
	Book value attributable to Assured Guaranty Ltd. per share		24.56			25.74			25.52		19.97		18.76

Non-GAAP Financial Measures
	Operating income		$	260		$	535		$	601	$	655	$	278
	Operating income per diluted share		1.34			2.81			3.24		3.46		2.15
	Adjusted book value		9,218			9,151			8,987		8,989		8,887
	PVP		18			210			243		363		640

Other Financial Information (GAAP Basis)
	Net debt service outstanding (end of period)		$	751,741		$	782,180		$	845,665	$	927,143	$	958,265
	Gross debt service outstanding (end of period)		801,747			834,950			936,132		1,029,982		1,095,037
	Net par outstanding (end of period)		501,817			519,893			558,048		617,131		640,422
	Gross par outstanding (end of period)		532,746			552,039			614,342		681,248		726,929

Other Financial Information (Statutory Basis)⁽¹⁾
	Net debt service outstanding (end of period)		$	725,977		$	757,914		$	829,545	$	905,131	$	942,193
	Gross debt service outstanding (end of period)		774,278			809,341			917,719		1,004,096		1,076,039
	Net par outstanding (end of period)		477,921			497,399			543,100		598,843		626,274
	Gross par outstanding (end of period)		507,286			528,318			597,290		659,765		709,786

	Consolidated qualified statutory capital		6,148			5,943			5,688		4,915		4,841
	Consolidated policyholders' surplus and reserves		10,174			10,288			10,626		10,247		10,409

	Ratios:
		Par insured to statutory capital	78		:1	84:1			95:1		122:1		129:1
		Capital ratio⁽²⁾	118		:1	128:1			146:1		184:1		195:1
		Financial resources ratio⁽³⁾	61		:1	61:1			65:1		72:1		72:1

	Gross debt service written:
		Public finance - U.S.	$	2,427		$	25,252		$	26,630	$	48,990	$	87,940
		Public finance - non-U.S.	—			40			208		51		894
		Structured finance - U.S.	18			623			1,731		2,962		2,501
		Structured finance - non-U.S.	—			—			—		—		—
	Total gross debt service written		$	2,445		$	25,915		$	28,569	$	52,003	$	91,335

	Net debt service written		$	2,445		$	25,915		$	28,569	$	52,003	$	91,335
	Net par written		1,594			16,816			16,892		30,759		49,759
	Gross par written		1,594			16,816			16,892		30,759		49,921


1)	Statutory amounts prepared on a consolidated basis. The NAIC Annual Statements for U.S. Domiciled Insurance Subsidiaries are prepared on a stand-alone basis.


2)	The capital ratio is calculated by dividing net debt service outstanding by qualified statutory capital.


3)	The financial resources ratio is calculated by dividing net debt service outstanding by total claims paying resources.

Note: Please refer to the explanation of Non-GAAP Financial Measures set forth at the end of this Financial Supplement.

Glossary

Net Par Outstanding and Internal Ratings

Internal Rating for the Company’s ratings scale is similar to that used by the nationally recognized statistical rating organizations; however, the ratings in the tables may not be the same as ratings assigned by any such rating agency. The super senior category, which is not generally used by rating agencies, is used by the Company in instances where Assured Guaranty's AAA-rated exposure on its internal rating scale has additional credit enhancement due to either (a) the existence of another security rated AAA that is subordinated to Assured Guaranty's exposure or (b) Assured Guaranty's exposure benefiting from a different form of credit enhancement that would pay any claims first in the event that any of the exposures incurs a loss, and such credit enhancement, in management's opinion, causes Assured Guaranty's attachment point to be materially above the AAA attachment point.

Net par outstanding is insured par exposure net of reinsurance cessions.

Performance Indicators

The performance information described below is obtained from third parties and/or provided by the trustee and may be subject to restatement or correction:

60+ Day Delinquencies are defined as loans that are greater than 60 days delinquent and all loans that are in foreclosure, bankruptcy or real estate owned divided by current collateral balance.

Average Credit Enhancement is intended to provide a measure of the amount of equity and/or subordinated tranches that are junior in the capital structure to Assured Guaranty’s exposure, expressed as a percentage of the total transaction size, and reflects any reduction of that credit support resulting from defaults or other factors. For transactions where excess spread may be available to absorb certain losses, the amounts shown do not include any benefit from excess spread. The calculation methodologies differ for the various asset classes to reflect differences in transaction structures in order to provide a measure that management believes is comparable across asset classes.

Cumulative Losses are defined as net charge-offs on the underlying loan collateral divided by the original collateral balance.

Pool Factor is the percentage of the current collateral balance divided by the original collateral balance of the transactions at inception.

Subordination represents the sum of subordinate tranches and overcollateralization, expressed as a percentage of total transaction size, and does not include any benefit from excess spread collections that may be used to absorb losses. Many of the closed-end second lien RMBS transactions insured by the Company have unique structures whereby the collateral may be written down for losses without a corresponding write-down of the obligations insured by the Company. Many of these transactions are currently undercollateralized, with the principal amount of collateral being less than the principal amount of the obligation insured by the Company. The Company is not required to pay principal shortfalls until legal maturity (rather than making timely principal payments), and takes the undercollateralization into account when estimating expected losses for these transactions.

Sectors

Below are brief descriptions of selected types of public and structured finance obligations that the Company insures and reinsures. For a more complete description, please refer to Assured Guaranty Ltd.’s Annual Report on Form 10-K for December 31, 2012.

Public Finance:

General Obligation Bonds are full faith and credit bonds that are issued by states, their political subdivisions and other municipal issuers, and are supported by the general obligation of the issuer to pay from available funds and by a pledge of the issuer to levy ad valorem taxes in an amount sufficient to provide for the full payment of the bonds.

Tax-Backed Bonds are obligations that are supported by the issuer from specific and discrete sources of taxation. They include tax-backed revenue bonds, general fund obligations and lease revenue bonds. Tax-backed obligations may be secured by a lien on specific pledged tax revenues, such as a gasoline or excise tax, or incrementally from growth in property tax revenue associated with growth in property values. These obligations also include obligations secured by special assessments levied against property owners and often benefit from issuer covenants to enforce collections of such assessments and to foreclose on delinquent properties. Lease revenue bonds typically are general fund obligations of a municipality or other governmental authority that are subject to annual appropriation or abatement; projects financed and subject to such lease payments ordinarily include real estate or equipment serving an essential public purpose. Bonds in this category also include moral obligations of municipalities or governmental authorities.

Municipal Utility Bonds are obligations of all forms of municipal utilities, including electric, water and sewer utilities and resource recovery revenue bonds. These utilities may be organized in various forms, including municipal enterprise systems, authorities or joint action agencies.

Transportation Bonds include a wide variety of revenue-supported bonds, such as bonds for airports, ports, tunnels, municipal parking facilities, toll roads and toll bridges.

Healthcare Bonds are obligations of healthcare facilities, including community-based hospitals and systems, as well as of health maintenance organizations and long-term care facilities.

Glossary (continued)

Sectors (continued)

Higher Education Bonds are obligations secured by revenue collected by either public or private secondary schools, colleges and universities. Such revenue can encompass all of an institution’s revenue, including tuition and fees, or in other cases, can be specifically restricted to certain auxiliary sources of revenue.

Infrastructure Bonds include obligations issued by a variety of entities engaged in the financing of infrastructure projects, such as roads, airports, ports, social infrastructure and other physical assets delivering essential services supported by long-term concession arrangements with a public sector entity.

Investor-Owned Utility Bonds are obligations primarily backed by investor-owned utilities, first mortgage bond obligations of for-profit electric or water utilities providing retail, industrial and commercial service, and also include sale-leaseback obligation bonds supported by such entities.

Housing Revenue Bonds are obligations relating to both single and multi-family housing, issued by states and localities, supported by cash flow and, in some cases, insurance from entities such as the Federal Housing Administration.

Regulated Utilities Obligations are issued by government-regulated providers of essential services and commodities, including electric, water and gas utilities. The majority of the Company's international regulated utility business is conducted in the United Kingdom.

Pooled Infrastructure Obligations are synthetic asset-backed obligations that take the form of CDS obligations or credit‑-linked notes that reference either infrastructure finance obligations or a pool of such obligations, with a defined deductible to cover credit risks associated with the referenced obligations.

Other Public Finance primarily includes government insured student loans, government-sponsored project finance and structured municipal transactions, which includes excess of loss reinsurance on portfolios of municipal credits.

Structured Finance:

Pooled Corporate Obligations are securities primarily backed by various types of corporate debt obligations, such as secured or unsecured bonds, bank loans or loan participations and trust preferred securities. These securities are often issued in ‘‘tranches,’’ with subordinated tranches providing credit support to the more senior tranches. The Company’s financial guaranty exposures generally are to the more senior tranches of these issues.

Residential Mortgage-Backed Securities (‘‘RMBS’’) and Home Equity Securities are obligations backed by closed-end first mortgage loans and closed- and open-end second mortgage loans or home equity loans on one-to-four family residential properties, including condominiums and cooperative apartments. First mortgage loan products in these transactions include fixed rate, adjustable rate (‘‘ARM’’) and option adjustable-rate (‘‘Option ARM’’) mortgages. The credit quality of borrowers covers a broad range, including ‘‘prime’’, ‘‘subprime’’ and ‘‘Alt-A’’. A prime borrower is generally defined as one with strong risk characteristics as measured by factors such as payment history, credit score, and debt-to-income ratio. A subprime borrower is a borrower with higher risk characteristics, usually as determined by credit score and/or credit history. An Alt-A borrower is generally defined as a prime quality borrower that lacks certain ancillary characteristics, such as fully documented income.

Additional insured obligations within RMBS include Home Equity Lines of Credit (“HELOCs”), which refers to a type of residential mortgage-backed transaction backed by second-lien loan collateral consisting of home equity lines of credit. U.S. Prime First Lien is a type of residential mortgage-backed securities transaction backed primarily by prime first-lien loan collateral plus an insignificant amount of other miscellaneous RMBS transactions.

CBOs/CLOs (collateralized bond obligations and collateralized loan obligations) are asset-backed securities largely backed by non-investment grade/high yield collateral.

Commercial Mortgage-Backed Securities (‘‘CMBS’’) are obligations backed by pools of commercial mortgages. The collateral supporting CMBS include office, multifamily, retail, hotel, industrial and other specialized or mixed-use properties.

Financial Products is the guaranteed investment contracts ("GICs") portion of the former Financial Products Business of AGMH. AGM has issued financial guaranty insurance policies on the GICs and in respect of the GICs business that cannot be revoked or cancelled. Assured Guaranty is indemnified against exposure to the former financial products business by Dexia SA and certain of its affiliates. In addition, the French and Belgian governments have issued guaranties in respect of the GICs portion of the financial products business. The financial products business is currently being run off.

Consumer Receivables Securities are obligations backed by non-mortgage consumer receivables, such as automobile loans and leases, credit card receivables and other consumer receivables.

Commercial Receivables Securities are obligations backed by equipment loans or leases, fleet auto financings, business loans and trade receivables. Credit support is derived from the cash flows generated by the underlying obligations, as well as property or equipment values as applicable.

Glossary (continued)

Sectors (continued)

Insurance Securitization Securities are obligations secured by the future earnings from pools of various types of insurance/reinsurance policies and income produced by invested assets.

Structured Credit Securities include program-wide credit enhancement for commercial paper conduits in the U.S., and securities issued in whole business securitizations and intellectual property securitizations. Program-wide credit enhancement generally involves insuring against the default of ABS in a bank-sponsored commercial paper conduit. Securities issued in whole business and intellectual property securitizations are backed by revenue-producing assets sold to a limited-purpose company by an operating company, including franchise agreements, lease agreements, intellectual property and real property.

Other Structured Finance Securities are obligations backed by assets not generally described in any of the other described categories. One such type of asset is a tax benefit to be realized by an investor in one of the Federal or state programs that permit such investor to receive a credit against taxes (such as Federal corporate income tax or state insurance premium tax) for making qualified investments in specified enterprises, typically located in designated low-income areas.

Non-GAAP Financial Measures

The Company references financial measures that are not in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Management and the board of directors utilize non-GAAP measures in evaluating the Company’s financial performance and as a basis for determining senior management incentive compensation. By providing these non-GAAP financial measures, investors, analysts and financial news reporters have access to the same information that management reviews internally. In addition, Assured Guaranty’s presentation of non-GAAP financial measures is consistent with how analysts calculate their estimates of Assured Guaranty’s financial results in their research reports on Assured Guaranty and with how investors, analysts and the financial news media evaluate Assured Guaranty’s financial results.

The following paragraphs define each non-GAAP financial measure and describe why it is useful. A reconciliation of the non-GAAP financial measure and the most directly comparable GAAP financial measure, if available, is presented within this financial supplement. Non-GAAP financial measures should not be viewed as substitutes for their most directly comparable GAAP measures.

Operating Income: Management believes that operating income is a useful measure because it clarifies the understanding of the underwriting results of the Company’s financial guaranty insurance business, and also includes financing costs and net investment income, and enables investors and analysts to evaluate the Company’s financial results as compared with the consensus analyst estimates distributed publicly by financial databases. Operating income is defined as net income (loss) attributable to Assured Guaranty Ltd., as reported under GAAP, adjusted for the following:

1) Elimination of the after-tax realized gains (losses) on the Company’s investments, except for gains and losses on securities classified as trading. The timing of realized gains and losses, which depends largely on market credit cycles, can vary considerably across periods. The timing of sales is largely subject to the Company’s discretion and influenced by market opportunities, as well as the Company’s tax and capital profile. Trends in the underlying profitability of the Company’s business can be more clearly identified without the fluctuating effects of these transactions.

2) Elimination of the after-tax non-credit-impairment unrealized fair value gains (losses) on credit derivatives, which is the amount in excess of the present value of the expected estimated economic credit losses and non-economic payments. Such fair value adjustments are heavily affected by, and in part fluctuate with, changes in market interest rates, credit spreads and other market factors and are not expected to result in an economic gain or loss. Additionally, such adjustments present all financial guaranty contracts on a more consistent basis of accounting, whether or not they are subject to derivative accounting rules.

3) Elimination of the after-tax fair value gains (losses) on the Company’s committed capital securities. Such amounts are heavily affected by, and in part fluctuate with, changes in market interest rates, credit spreads and other market factors and are not expected to result in an economic gain or loss.

4) Elimination of the after-tax foreign exchange gains (losses) on remeasurement of net premium receivables and loss and LAE reserves. Long-dated receivables constitute a significant portion of the net premium receivable balance and represent the present value of future contractual or expected collections. Therefore, the current period’s foreign exchange remeasurement gains (losses) are not necessarily indicative of the total foreign exchange gains (losses) that the Company will ultimately recognize.

5) Elimination of the effects of consolidating FG VIEs in order to present all financial guaranty contracts on a more consistent basis of accounting, whether or not GAAP requires consolidation. GAAP requires the Company to consolidate certain VIEs that have issued debt obligations insured by the Company even though the Company does not own such VIEs.

Operating Shareholders’ Equity: Management believes that operating shareholders’ equity is a useful measure because it presents the equity of Assured Guaranty Ltd. with all financial guaranty contracts accounted for on a more consistent basis and excludes fair value adjustments that are not expected to result in economic loss. Many investors, analysts and financial news reporters use operating shareholders’ equity as the principal financial measure for valuing Assured Guaranty Ltd.’s current share price or projected share price and also as the basis of their decision to recommend buying or sellingAssured Guaranty Ltd.’s common shares. Many of the Company’s fixed income investors also use operating shareholders’ equity to evaluate the Company’s capital adequacy. Operating shareholders’ equity is the basis of the calculation of adjusted book value (see below). Operating shareholders’ equity is defined as shareholders’ equity attributable to Assured Guaranty Ltd. , as reported under GAAP, adjusted for the following:

1) Elimination of the effects of consolidating FG VIEs in order to present all financial guaranty contracts on a more consistent basis of accounting, whether or not GAAP requires consolidation. GAAP requires the Company to consolidate certain VIEs that have issued debt obligations insured by the Company even though the Company does not own such VIEs.

Non-GAAP Financial Measures (continued)

Operating Shareholders’ Equity (continued):

4) Elimination of the after-tax unrealized gains (losses) on the Company’s investments, that are recorded as a component of accumulated other comprehensive income ("AOCI") (excluding foreign exchange remeasurement). The AOCI component of the fair value adjustment on the investment portfolio is not deemed economic because the Company generally holds these investments to maturity and therefore should not recognize an economic gain or loss.

Operating return on equity (‘‘Operating ROE’’): Operating ROE represents operating income for a specified period divided by the average of operating shareholders’ equity at the beginning and the end of that period. Management believes that operating ROE is a useful measure to evaluate the Company’s return on invested capital. Many investors, analysts and members of the financial news media use operating ROE to evaluate Assured Guaranty Ltd.’s share price and as the basis of their decision to recommend, buy or sell the Assured Guaranty Ltd. common shares. Quarterly and year-to-date operating ROE are calculated on an annualized basis.

Adjusted Book Value: Management believes that adjusted book value is a useful measure because it enables an evaluation of the net present value of the Company’s in-force premiums and revenues in addition to operating shareholders’ equity. The premiums and revenues included in adjusted book value will be earned in future periods, but actual earnings may differ materially from the estimated amounts used in determining current adjusted book value due to changes in foreign exchange rates, prepayment speeds, terminations, credit defaults and other factors. Many investors, analysts and financial news reporters use adjusted book value to evaluate Assured Guaranty Ltd.’s share price and as the basis of their decision to recommend, buy or sell the Assured Guaranty Ltd. common shares. Adjusted book value is operating shareholders’ equity, as defined above, further adjusted for the following:

1) Elimination of after-tax deferred acquisition costs, net. These amounts represent net deferred expenses that have already been paid or accrued and will be expensed in future accounting periods.

2) Addition of the after-tax net present value of estimated net future credit derivative revenue. See below.

3) Addition of the after-tax value of the unearned premium reserve on financial guaranty contracts in excess of expected loss to be expensed, net of reinsurance. This amount represents the expected future net earned premiums, net of expected losses to be expensed which are not reflected in GAAP equity.

Net present value of estimated net future credit derivative revenue: Management believes that this amount is a useful measure because it enables an evaluation of the value of future estimated credit derivative revenue. There is no corresponding GAAP financial measure. This amount represents the present value of estimated future revenue from the Company’s credit derivative in-force book of business, net of reinsurance, ceding commissions and premium taxes for contracts without expected economic losses, and is discounted at 6%. Estimated net future credit derivative revenue may change from period to period due to changes in foreign exchange rates, prepayment speeds, terminations, credit defaults or other factors that affect par outstanding or the ultimate maturity of an obligation.

PVP or present value of new business production: Management believes that PVP is a useful measure because it enables the evaluation of the value of new business production for Assured Guaranty by taking into account the value of estimated future installment premiums on all new contracts underwritten in a reporting period as well as premium supplements and additional installment premium on existing contracts as to which the issuer has the right to call the insured obligation but has not exercised such right, whether in insurance or credit derivative contract form, which GAAP gross premiums written and the net credit derivative premiums received and receivable portion of net realized gains and other settlements on credit derivatives (“Credit Derivative Revenues”) do not adequately measure. PVP in respect of financial guaranty contracts written in a specified period is defined as gross upfront and installment premiums received and the present value of gross estimated future installment premiums, in each case, discounted at 6%. For purposes of the PVP calculation, management discounts estimated future installment premiums on insurance contracts at 6%, while under GAAP, these amounts are discounted at a risk free rate. Additionally, under GAAP, management records future installment premiums on financial guaranty insurance contracts covering non-homogeneous pools of assets based on the contractual term of the transaction, whereas for PVP purposes, management records an estimate of the future installment premiums the Company expects to receive, which may be based upon a shorter period of time than the contractual term of the transaction. Actual future net earned or written premiums and Credit Derivative Revenues may differ from PVP due to factors including, but not limited to, changes in foreign exchange rates, prepayment speeds, terminations, credit defaults, or other factors that affect par outstanding or the ultimate maturity of an obligation.

Assured Guaranty Ltd.

30 Woodbourne Avenue

Hamilton HM 08

Bermuda

(441) 279-5705

www.assuredguaranty.com

Contacts:

Equity and Fixed Income Investors:

Robert Tucker

Managing Director, Investor Relations and Corporate Communications

(212) 339-0861

rtucker@assuredguaranty.com

Michael Walker

Managing Director, Fixed Income Investor Relations

(212) 261-5575

mwalker@assuredguaranty.com

Ross Aron

Vice President, Equity Investor Relations

(212) 261-5509

raron@assuredguaranty.com

Media:

Ashweeta Durani

Vice President, Corporate Communications

(212) 408-6042

adurani@assuredguaranty.com

ASSURED GUARANTY LTD - FORM 8-K - EX-99.2 - EXHIBIT - May 9, 2013

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