Assured Guaranty Ltd. Q3 FY2024 earnings call

• New business production has been strong across segments, with year-to-date PVP for the first 3 quarters of 2024 at $281 million, $32 million higher than the same period last year.
• Adjusted book value per share and adjusted operating shareholders' equity per share reached record highs at the end of the third quarter.
• AGM merger completed, with ratings from S&P, Moody's, and KBRA affirming no change post-merger. Excess capital above rating requirements remains.
• Alternative investments and mark-to-market gains on trading securities contributed $135 million in the first 9 months of 2024, with inception-to-date return on investments including Sound Point and AHP at approximately 13% through September.
• Share repurchase program: Targeting $500 million annually, expected to reach $500 million in 2024, Board authorized an additional $250 million, remaining authorization ~$385 million, with target of $500 million for 2025.
• Unresolved Puerto Rico exposure: PREPA in mediation, committed to fair resolution, will enforce rights as secured creditor if needed.
• Municipal bond insurance is the market leader, insuring 57% of insured pars in the U.S. municipal bond primary market year-to-date, with large transactions insured such as Brightline, JFK Airport, etc.
• Non-U.S. public finance and global structured finance had strong PVP, with expansion into new markets.

The company's segments showed strong performance. In U.S. public finance, year-to-date PVP was $281 million, $32 million higher than the first 3 quarters of the previous year. It insured $16.6 billion of new insured par in the first 9 months of 2024, 18% higher than the same period last year. Non-U.S. public finance had year-to-date PVP of $44 million, $6 million higher than the same period last year. Global structured finance had year-to-date PVP of $44 million, with third quarter PVP at $19 million, $5 million higher than the previous year's third quarter.

• Target $500 million share repurchases for both 2024 and 2025.
• Expect issuance to remain high due to infrastructure needs both in the U.S. and internationally.
• Confident in continued growth in municipal and other segments as the company strategically pursues new product opportunities and manages capital.

• Unresolved Puerto Rico exposure with PREPA in mediation.
• U.K. regulated utilities exposure, but expected to have relatively insignificant losses as it is a natural order of events and supportive measures are in place.

Q: Capital management and U.K. utilities impact on 2025 outlook and dividend capacity.

A: No impact on dividend capacity or the buyback program.

Q: Municipal issuance and insured penetration.

A: Insured penetration increasing year-to-year, expect issuance to remain high, and continue to grow insured volumes.

Q: PREPA and MBA acquisition.

A: Waiting for the right price for MBA, PREPA mediation ongoing.

Q: U.K. water utilities exposure.

A: No significant loss expected, supportive of equity and debt raises, with rates appeal ongoing.

Q: Buyback capacity and international transactions.

A: Exploring dividend capacity, international transactions have better returns with shorter tenor.