8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant To Section 13 or 15 (d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) —November 3, 2005

ASSURED GUARANTY LTD.

(Exact name of registrant as specified in its charter)

Bermuda	001-32141	98-0429991
(State or other jurisdiction of	(Commission File Number)	(I.R.S. Employer Identification No.)
incorporation or organization)

Assured Guaranty Ltd.

30 Woodbourne Avenue

Hamilton HM 08 Bermuda

(Address of principal executive offices)

Registrant’s telephone number, including area code: (441) 296-4004

Not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

(Former name or former address, if changed since last report)

Item 2.02       Results of Operations and Financial Condition

On November 3, 2005, Assured Guaranty Ltd. issued a press release reporting its third quarter 2005 results and the availability of its third quarter financial supplement. The press release and the financial supplement are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are hereby incorporated herein by reference.

Item 9.01       Financial Statements, Pro Forma Financial Information and Exhibits.

(c)Exhibits

Exhibit Number	Description
99.1	Press release, dated November 3, 2005, reporting third quarter results
99.2	Third quarter 2005 Financial Supplement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ASSURED GUARANTY LTD.
By:	/S/Robert B. Mills
	Robert B. Mills
	Chief Financial Officer

DATE:       November 3, 2005

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EX-99.1

Ex 99.1

	Assured Guaranty Ltd.
	30 Woodbourne Avenue
	Hamilton HM 08 Bermuda
	441-299-9375
	www.assuredguaranty.com

Press Release

Assured Guaranty Ltd. Reports Third Quarter 2005 Net Income

of $39.2 Million

Hamilton, Bermuda, November 3, 2005 —Assured Guaranty Ltd. (NYSE: AGO) reported net income for the third quarter ended September 30, 2005 of $39.2 million, or $0.53 per diluted share, a decrease of 12% compared with net income of $44.5 million, or $0.59 per diluted share, in the third quarter of 2004.  The decline in net income was due primarily to a reduction in after tax unrealized gains on derivative instruments from $10.1 million in the third quarter of 2004 to $0.2 million in the third quarter of 2005.

Operating income, a non-GAAP financial measure, for the third quarter of 2005 was $38.9 million, or $0.52 per diluted share, an increase of 16% from $33.6 million, or $0.45 per diluted share, in the third quarter of 2004.  See “Explanation of Non-GAAP Financial Measures” below.  The growth in operating income was the result of an increase in the Company’s consolidated underwriting gain versus the prior year period.

Dominic Frederico, President and Chief Executive Officer of Assured Guaranty Ltd., commented, “Assured Guaranty continues to gain traction in the financial guaranty market.  During the quarter we underwrote our first future flow transaction and our first home equity line of credit securitization, expanding our asset class market presence.  Our year-to-date new business production clearly demonstrates the growing  demand for our guaranty from U.S. and global investors and issuers.”

Analysis of Net Income
($ in millions)

	3Q-05		3Q-04		% Change
Net income	$	39.2	$	44.5	(12	)%
Less: After-tax realized gains on investments	0.1		0.8		(88	)%
Less: After-tax unrealized gains on derivatives	0.2		10.1		(98	)%
Operating income	$	38.9	$	33.6	16	%
Weighted average shares outstanding (in millions):
Basic	73.9		75.0		(1	)%
Diluted	74.5		75.0		(1	)%

Per Diluted Share

	3Q-05		3Q-04		% Change
Net income	$	0.53	$	0.59	(10	)%
Less: After-tax realized gains on investments	—		0.01		NMF
Less: After-tax unrealized gains on derivatives	0.01		0.13		(92	)%
Operating income	$	0.52	$	0.45	16	%

To assist analysts and investors in evaluating the Company’s financial results, this press release references several non-GAAP financial measures.  These non-GAAP financial measures are defined in the “Explanation of Non-GAAP Financial Measures” section of this press release. In each case, the most directly comparable GAAP financial measure is presented and a reconciliation of the non-GAAP financial measure and GAAP measure is provided. This presentation is consistent with the way that Company management, analysts and investors

evaluate the Company’s financial results and is comparable to the earnings per share estimates published by analysts in their research reports on the Company.  The non-GAAP financial measures included in this press release are: operating income, present value of financial guaranty and mortgage guaranty gross written premiums (“PVP”), net present value of estimated future installment premiums in force and adjusted book value.

Income Statement Highlights:

Net Written Premiums by Segment

($ in millions)

	3Q-05		3Q-04		% Change
Financial guaranty direct	$	24.2	$	14.1	72	%
Mortgage guaranty	1.7		5.3		(68	)%
Financial guaranty reinsurance	27.3		35.6		(23	)%
Total financial guaranty	53.2		55.0		(3	)%
Other	—		—		—
Total	$	53.2	$	55.0	(3	)%

Net written premiums in the third quarter of 2005 were $53.2 million, down 3% over the third quarter of 2004. On a segment basis, net written premiums in the financial guaranty direct segment were $24.2 million, up 72% over the prior year period, reflecting growth in both public and structured finance premiums.  Mortgage guaranty net written premiums were $1.7 million, down 68% compared to $5.3 million in the prior year period, which included premiums received on several contracts that are no longer in force.  Net written premiums in the financial guaranty reinsurance segment for the quarter were $27.3 million, a decline of 23% over the prior year period, due to lower upfront premiums, principally on public finance reinsurance.  The other segment, which includes businesses sold or discontinued as part of our IPO, has not generated net written or earned premiums since the end of the second quarter of 2004.

Net Earned Premiums by Segment

($ in millions)

	3Q-05		3Q-04		% Change
Financial guaranty direct	$	18.3	$	16.5	11	%
Mortgage guaranty	4.3		5.1		(16	)%
Financial guaranty reinsurance	32.0		31.9		—
Total financial guaranty	54.5		53.4		2	%
Other	—		—		—
Total	$	54.5	$	53.4	2	%

Net earned premiums in the third quarter of 2005 were $54.5 million, up 2% over the third quarter of 2004.  On a segment basis, financial guaranty direct net earned premiums in the third quarter of 2005 were $18.3 million, up 11% compared to $16.5 million in the third quarter of 2004, which included $1.6 million of net earned premiums from the Company’s single name credit default swap business that was sold in the first quarter of 2005.  Mortgage guaranty net earned premiums in the third quarter of 2005 declined to $4.3 million from $5.1 million in the third quarter of 2004, primarily due to the run-off of the Company’s quota share mortgage guaranty reinsurance treaties.  Financial guaranty reinsurance net earned premiums, including municipal bond refundings, in the third quarter of 2005 were $32.0 million compared to $31.9 million reported in the third quarter of 2004.  Municipal bond refunding net earned premiums were $4.8 million ($0.03 per diluted share) in the third quarter of 2005 compared with $5.2 million ($0.03 per diluted share) in the third quarter of 2004.

2

Underwriting Results by Segment

($ in millions)

	3Q-05		3Q-04		% Change
Underwriting gain:
Financial guaranty direct	$	10.8	$	7.8	38	%
Mortgage guaranty	1.9		7.7		(75	)%
Financial guaranty reinsurance	11.3		4.5		151	%
Total financial guaranty	24.0		20.0		20	%
Other	1.3		—		NMF
Total	$	25.3	$	20.0	27	%

Assured Guaranty reported a consolidated underwriting gain in the third quarter of 2005 of $25.3 million, up 27% compared to an underwriting gain of $20.0 million in the third quarter of 2004.  The third quarter of 2004 included $1.8 million of loss expenses incurred ($0.1 million after-tax) due to refinements in our portfolio loss reserve methodology.

On a segment basis, the underwriting gain for the financial guaranty direct segment in the third quarter of 2005 was $10.8 million, up 38% from $7.8 million in the third quarter of 2004 that included $1.5 million in loss expenses that resulted from refinements of our portfolio loss reserve methodology during the quarter.  The mortgage guaranty segment’s underwriting results in the third quarter of 2005 declined to $1.9 million from $7.7 million in the third quarter of 2004 that included a $5.5 million benefit that resulted from refinements in our portfolio reserve methodology due to a rating agency review of the transactions in our mortgage guaranty segment.  The underwriting gain for the financial guaranty reinsurance segment in the third quarter of 2005 rose 151% to $11.3 million from $4.5 million in the third quarter of 2004 that included loss expenses incurred of $5.8 million related to the refinements in our portfolio loss reserve methodology.

Shareholders’ Equity Highlights:

(amounts in millions except per share data)

	As of
	September 30, 2005		December 31, 2004
Book value	$	1,633.6	$	1,527.6
Net UPR less DAC - after-tax (1)	304.6		268.6
Net present value of installment premiums in-force - after-tax (2)	306.3		297.1
Adjusted book value	$	2,244.6	$	2,093.3
Shares outstanding at the end of period (in millions)	74.9		75.7
Book value per share outstanding:
Book value	$	21.81	$	20.19
Net UPR less DAC - after-tax (1)	4.07		3.55
Net present value of installment premiums in-force - after-tax (2)	4.09		3.93
Adjusted book value	$	29.96	$	27.67

(1)	Unearned premium reserve (UPR) less pre-paid reinsurance premiums and deferred acquisition costs (DAC), all after-tax.
(2)	Due to reporting lag by our ceding companies, the present value of estimated installment premiums in force in our reinsurance segment is reported on a one-quarter lag.

At September 30, 2005, the Company’s book value per share was $21.81, an increase of 8% over the book value of $20.19 reported at December 31, 2004. The increase was primarily the result of the net income the Company has earned since year-end 2004, which was slightly offset by a reduction in accumulated other comprehensive income.  Adjusted book value per share, a non-GAAP financial measure, at September 30, 2005 was $29.96, up 8% from December 31, 2004, reflecting the growth since year-end 2004 in book value, net unearned premium reserves and net after-tax present value of estimated installment premiums in force, a non-GAAP financial measure.

3

New Business Production:

Analysis of Present Value of Financial Guaranty and Mortgage Guaranty Gross
Written Premiums (“PVP”)

($ in millions)

	Three Months Ended
	September 30,
	2005		2004
Premium analysis:
Gross written premiums (GWP) analysis:
Present value of financial guaranty & mortgage guaranty GWP (PVP) (1)
Financial guaranty direct	$	39.4	$	7.9
Mortgage guaranty	—		1.1
Financial guaranty reinsurance	22.5		38.9
Total PVP	$	61.9	$	48.0
Less: Installment premium PVP	40.3		23.5
Upfront financial guaranty & mortgage guaranty GWP	21.6		24.5
Plus: Installment GWP	32.3		32.5
Financial guaranty & mortgage guaranty GWP	53.9		57.0
Other segment GWP	21.6		5.2
Total gross written premiums	$	75.6	$	62.2

(1). Due to reporting lags by our ceding companies, PVP for installment premiums from our financial guaranty reinsurance segment is reported on a one-quarter lag.

In the third quarter of 2005, new business production as measured by PVP, a non-GAAP financial measure, rose to $61.9 million, up 29% from the $48.0 million written in the third quarter of 2004.  The financial guaranty direct segment generated $39.4 million of PVP, a 399% increase over third quarter 2004 PVP of $7.9 million, reflecting the expansion of both the public and structured finance businesses.  The financial guaranty reinsurance segment’s third quarter 2005 PVP was $22.5 million, a 42% decrease from the segment’s third quarter 2004 PVP of $38.9 million, which included $9.4 million in PVP on two reinsurance contracts that are no longer in force.  Excluding these two contracts from the third quarter of 2004, financial guaranty reinsurance PVP declined 24% due to lower business ceded by one of our reinsurance clients.  The Company did not write any new mortgage guaranty contracts in the quarter, and thus no PVP was recorded, as contrasted to the third quarter of 2004 when one contract for PVP of $1.1 million was written.

Dividend: Earlier today, Assured Guaranty’s Board of Directors declared a regular quarterly dividend of U.S. $0.03 per common share.  The dividend is payable on December 8, 2005 to shareholders of record at the close of business on November 17, 2005.

Investor Conference Call:  The Company will host a conference call for investors at 8:30 a.m. Eastern Time (9:30 a.m. Atlantic Time) on Friday, November 4, 2005.  The earnings conference call will be available via live and archived webcast in the Investor Information section of the Company’s website at http://www.assuredguaranty.com or by dialing 1-800-706-7748 (in the U.S.) or 1-617-614-3473 (International), passcode 25328277.  A replay of the call will be available through December 4, 2005.  To listen to the replay dial: 1-888-286-8010 (in the U.S.) or 1-617-801-6888 (International), passcode 34984651.

Please refer to Assured Guaranty Ltd.’s Third Quarter 2005 Financial Supplement, which is posted on the Company’s website at http://www.assuredguaranty.com/investor/supplement.html, for more information on the Company’s individual segment performance, financial guaranty portfolios, investment portfolio and other items.

4

Assured Guaranty Ltd. is a Bermuda-based holding company. Its operating subsidiaries provide credit enhancement products to the U.S. and international public finance, structured finance and mortgage markets.  More information can be found at www.assuredguaranty.com.

Explanation of Non-GAAP Financial Measures:

The following section describes why the non-GAAP financial measures presented in this press release are useful for investors.

Operating income, which is a non-GAAP financial measure, is defined as net income excluding after-tax realized gains (losses) on investments and after-tax unrealized gains (losses) on derivative financial instruments.  We believe the presentation of operating income enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business.  We exclude net realized gains (losses) on investments and net unrealized gains (losses) on derivative financial instruments because the amount of these gains (losses) is heavily influenced by, and fluctuates in part according to, market interest rates, credit spreads and other factors that management cannot control or predict.  This measure should not be viewed as a substitute for net income determined in accordance with GAAP.

Adjusted book value, which is a non-GAAP financial measure, is derived by beginning with shareholder’s equity (book value) and adding or subtracting the after-tax value of the financial guaranty and mortgage guaranty unearned premium reserve net of prepaid reinsurance premiums and deferred acquisition costs and the after-tax value of the present value of estimated future installment premiums (discounted at 6%), net of reinsurance.  The adjustments described above will be realized in future periods, but may differ materially from the amounts used in determining current estimated adjusted book value due to changes in market interest rates, refunding activity, pre-payment speeds and other factors that management cannot control or predict.  Management, investors and analysts use the calculation of adjusted book value to evaluate the net present value of the Company’s in-force premium and capital base.

Present value of estimated installment premiums in-force, which is a non-GAAP financial measure, represents our estimated future premiums on our in-force book of installment premium business in our financial guaranty direct, financial guaranty reinsurance and mortgage guaranty segments.  Estimated future premiums may change from period to period due to changes in insured par outstanding that management cannot control or predict due to prepayments or amortizations differing from previous estimates or due to a change in future estimates due to market conditions, interest rates or other factors.  It is calculated net of reinsurance ceded and using a discount rate of 6%.  We believe present value of estimated installment premiums is a useful measure for management, equity analysts and investors because it permits the evaluation of future estimated installment premiums, similar to the GAAP financial measure of unearned premium reserves, net of reinsurance.

PVP, which is a non-GAAP financial measure, represents gross premiums and fees related to financial guaranty and mortgage guaranty contracts written in the current period, including upfront and installment premiums received on contracts written in the current period and the present value of estimated future installment premiums, discounted at 6% per year.   We use 6% as the present value discount, because it is the approximate taxable equivalent yield on our investment portfolio for the periods presented. We believe PVP is a useful measure for management, equity analysts and investors because it permits the evaluation of the value of new business production for Assured Guaranty by taking into account the value of installment premiums on new contracts underwritten in a reporting period, which the GAAP gross premiums written does not adequately measure.  Actual future net earned or written premiums may differ from PVP due to factors that management cannot control or predict, such as prepayments, amortizations, refundings, or defaults that may or may not be influenced by market interest rates, credit defaults or other factors.

5

Assured Guaranty Ltd.

Consolidated Income Statements

	Three Months Ended
	September 30,
	2005			2004
	(dollars in millions)
Revenues
Gross written premiums	$	75.6		$	62.2
Net written premiums	53.2			55.0
Net earned premiums	54.5			53.4
Net investment income	24.4			23.2
Other income	0.1			—
Total revenues	$	79.0		$	76.6
Expenses
Loss and loss adjustment expenses	(0.8		)	4.2
Profit commission expense	2.0			1.1
Acquisition costs	13.0			14.2
Other operating expenses	15.0			14.0
Other expenses	4.1			3.4
Total expenses	$	33.3		$	36.9
Income before provision for income taxes	45.7			39.7
Total provision for income taxes	6.8			6.1
Operating income *	$	38.9		$	33.6
After-tax net realized investment gains	0.1			0.8
After-tax unrealized gains on derivative financial instruments	0.2			10.1
Net income	$	39.2		$	44.5

 * Net income excluding after-tax net realized investment gains and net unrealized gains on derivative financial instruments.

6

Assured Guaranty Ltd.

Consolidated Balance Sheets

	As of:
	September 30,			December 31,
	2005			2004
	(dollars in millions)
Assets
Fixed maturity securities, at fair value	$	2,192.5		$	1,965.1
Short-term investments, at cost which approximates market	62.8			175.8
Total investments	2,255.3			2,140.9
Cash and cash equivalents	7.1			17.0
Accrued investment income	22.7			21.9
Deferred acquisition costs	190.0			186.4
Prepaid reinsurance premiums	12.9			15.2
Reinsurance recoverable on ceded losses	107.2			120.2
Premiums receivable	33.4			40.8
Goodwill	85.4			85.4
Unrealized gains on derivative financial instruments	34.8			43.9
Other assets	18.0			22.3
Total assets	$	2,766.7		$	2,694.0
Liabilities and shareholders’ equity
Liabilities
Unearned premium reserves	$	527.9		$	521.3
Reserves for losses and loss adjustment expenses	201.2			226.5
Profit commissions payable	47.3			61.7
Reinsurance balances payable	17.9			25.1
Current income taxes	12.4			—
Deferred income taxes	17.7			40.1
Funds held by Company under reinsurance contracts	55.1			50.8
Long-term debt	197.3			197.4
Other liabilities	56.2			43.7
Total liabilities	1,133.1			1,166.4
Shareholders’ equity
Common stock	0.7			0.8
Treasury stock	(7.9		)	(7.9		)
Additional paid-in capital	885.4			894.2
Unearned stock grant compensation	(9.4		)	(6.7		)
Retained earnings	711.8			568.3
Accumulated other comprehensive income	52.9			79.0
Total shareholders’ equity	1,633.6			1,527.6
Total liabilities and shareholders’ equity	$	2,766.7		$	2,694.0

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Cautionary Statement Regarding Forward-Looking Statements:

Any forward-looking statements made in this press release reflect the Company’s current views 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.  For example, the Company’s forward-looking statements, including its statements regarding PVP and present value of estimated installment premiums in force, could be affected by a significant reduction in the amount of reinsurance ceded by one or more of our principal ceding companies, rating agency action such as a ratings downgrade, difficulties with the execution of the Company’s business strategy, contract cancellations, developments in the world’s financial and capital markets, more severe or frequent losses associated with products affecting the adequacy of the Company’s loss reserve, changes in regulation or tax laws, governmental actions, the Company’s dependence on customers, decreased demand or increased competition, loss of key personnel, the effects of mergers, acquisitions and divestitures, changes in accounting policies or practices, and changes in general economic conditions, as well as management’s response to these factors, and other risk factors identified in the Company’s filings with the Securities and Exchange Commission.  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.  The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:

Equity Investors and Media

Sabra Purtill, CFA

Managing Director, Investor Relations

212-408-6044

441-278-6665

spurtill@assuredguaranty.com

Christopher McNamee

Assistant Vice President, Investor Relations

212-261-5509

cmcnamee@assuredguaranty.com

8

EX-99.2

Exhibit 99.2

Assured Guaranty Ltd.

Financial Supplement

Third Quarter 2005

September 30, 2005

Table of Contents
Assured Guaranty Ltd.
	Selected Financial Highlights
	Consolidated GAAP Income Statements
	Consolidated GAAP Balance Sheets
	Segment Consolidation
	Financial Guaranty Direct Segment
	Financial Guaranty Reinsurance Segment
	Mortgage Guaranty Segment
	Other Segment
	Loss and LAE Reserves
	Investment Portfolio
	Financial Guaranty Profile
	Non-Investment Grade Exposures
	Closely Monitored Credits
	Largest Exposures by Sector
	Consolidated Capital and Claims Paying Resources
	Summary Financial and Statistical Data

This supplement should be read in conjunction with documents filed by Assured Guaranty Ltd. (the “Company”) with the Securities and Exchange Commission, including our IPO prospectus dated April 22, 2004, our 10-Q’s dated March 31, 2004, June 30, 2004, September 30, 2004, March 31, 2005 and June 30, 2005 and our 10-K for the year ended December 31, 2004.

Cautionary Statement Regarding Forward-Looking Statements:

Any forward-looking statements made in this supplement reflect the Company’s current views 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.  For example, the Company’s forward-looking statements, such as its statements regarding PVP and present value of estimated installment premiums in force, could be affected by a significant reduction in the amount of reinsurance ceded by one or more of our principal ceding companies, rating agency action such as a ratings downgrade, difficulties with the execution of the Company’s business strategy, contract cancellations, developments in the world’s financial and capital markets, more severe losses or more frequent losses associated with products affecting the adequacy of the Company’s loss reserve, changes in regulation or tax laws, governmental actions, the Company’s dependence on customers, decreased demand or increased competition, loss of key personnel, the effects of mergers, acquisitions and divestitures, changes in accounting policies or practices, and changes in general economic conditions, as well as management’s response to these factors, and other risk factors identified in the Company’s filings with the Securities and Exchange Commission.

Assured Guaranty Ltd.

Selected Financial Highlights

(dollars and shares in millions except per share amounts)

	Quarter Ended						% Change		Nine Months Ended						% Change
	September 30,						versus		September 30,						versus
	2005			2004			3Q-04		2005			2004			YTD 2004
Gross written premiums (GWP) analysis:
Present value of financial guaranty & mortgage guaranty GWP (PVP) (a)	$	61.9		$	48.0		29	%	$	202.4		$	207.5		-2	%
Less: Installment premium PVP	40.3			23.5			72	%	126.4			111.8			13	%
Upfront financial guaranty & mortgage guaranty GWP	21.6			24.5			-12	%	76.0			95.7			-21	%
Less: Upfront premium due to novations	—			—			—		18.4			—			NMF
Plus: Installment GWP	32.3			32.5			-1	%	104.5			107.7			-3	%
Financial guaranty & mortgage guaranty GWP	53.9			57.0			-5	%	162.1			203.4			-20	%
Plus: Other segment GWP	21.6			5.2			316	%	32.0			(78.4		)	NMF
Total GWP	$	75.6		$	62.2		22	%	$	194.1		$	125.0		55	%
Net income	$	39.2		$	44.5		-12	%	$	150.3		$	134.5		12	%
Less: After-tax realized gains on investments	0.1			0.8			-88	%	2.8			7.1			-61	%
Less: After-tax unrealized gains (losses) on derivatives	0.2			10.1			-98	%	(7.9		)	22.2			NMF
Operating income (b)	$	38.9		$	33.6		16	%	$	155.4		$	105.2		48	%
Book value	$	1,633.6		$	1,487.9		10	%
Plus: Net unearned premium reserve less DAC, after-tax (1)	304.6			249.2			22	%
Plus: Net present value of installment premiums in-force, after-tax	306.3			281.4			9	%
Adjusted book value (c)	$	2,244.6		$	2,018.5		11	%
ROE, excluding AOCI	10.0		%	12.8		%			13.2		%	13.0		%
Less: After-tax realized gains on investments	—			0.2		%			0.2		%	0.7		%
Less: After-tax unrealized gains (losses) on derivatives	—			2.9		%			-0.7		%	2.1		%
Operating ROE, excluding AOCI (b)	10.0		%	9.7		%			13.7		%	10.1		%
Per diluted share:
Net income	$	0.53		$	0.59		-10	%	$	2.02		$	1.79		13	%
Less: After-tax realized gains on investments	—			0.01			NMF		0.04			0.10			-60	%
Less: After-tax unrealized gains (losses) on derivatives	0.01			0.13			-92	%	(0.11		)	0.30			NMF
Operating income (b)	$	0.52		$	0.45		16	%	$	2.09		$	1.40		49	%
Book value	$	21.81		$	19.58		11	%
Plus: Net unearned premium reserve less DAC, after-tax (1)	4.07			3.28			24	%
Plus: Net present value of installment premiums in-force, after-tax	4.09			3.70			11	%
Adjusted book value (c)	$	29.96		$	26.56		13	%
Additional information:
Shares outstanding at the end of period	74.9			76.0			-1	%	74.9			76.0			-1	%
Weighted average basic shares outstanding	73.9			75.0			-1	%	74.0			75.0			-1	%
Weighted average diluted shares outstanding	74.5			75.0			-1	%	74.5			75.0			-1	%
Consolidated net debt service outstanding	$	139,093		$	134,050		4	%
Consolidated net par outstanding	97,320			92,467			5	%
Consolidated claims-paying resources	3,077			2,781			11	%

(1) Unearned premium reserve (UPR) less pre-paid reinsurance premiums and deferred acquisition costs (DAC), all after-tax

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and adjusted book value (c)].

Assured Guaranty Ltd.

Consolidated GAAP Income Statements

(in millions, except per share amounts)

	Quarter Ended					% Change		Nine Months Ended						% Change
	September 30,					versus		September 30,						versus
	2005			2004		3Q-04		2005			2004			YTD 2004
Revenues
Gross written premiums	$	75.6		$	62.2	22	%	$	194.1		$	125.0		55	%
Net written premiums	53.2			55.0		-3	%	159.9			18.2			NMF
Net earned premiums	54.5			53.4		2	%	150.9			130.7			15	%
Net investment income	24.4			23.2		5	%	71.2			71.0			—
Other income	0.1			—		NMF		0.2			0.6			-67	%
Total revenues	$	79.0		$	76.6	3	%	$	222.3		$	202.3		10	%
Expenses
Loss and loss adjustment expenses	(0.8		)	4.2		NMF		(69.3		)	(32.2		)	115	%
Profit commission expense	2.0			1.1		82	%	6.4			11.4			-44	%
Acquisition costs	13.0			14.2		-8	%	34.9			35.8			-3	%
Other operating expenses	15.0			14.0		7	%	44.0			53.3			-17	%
Other expenses	4.1			3.4		21	%	13.3			9.0			48	%
Total expenses	$	33.3		$	36.9	-10	%	$	29.2		$	77.2		64	%
Income before provision for income taxes	45.7			39.7		15	%	193.1			125.1			54	%
Total provision for income taxes	6.8			6.1		11	%	37.7			19.9			89	%
Operating income (b)	$	38.9		$	33.6	16	%	$	155.4		$	105.2		48	%
After-tax net realized gains on investments	0.1			0.8		-88	%	2.8			7.1			-61	%
After-tax unrealized gains (losses) on derivative instruments	0.2			10.1		-98	%	(7.9		)	22.2			NMF
Net income	$	39.2		$	44.5	-12	%	$	150.3		$	134.5		12	%
Per diluted share
Operating income (b)	$	0.52		$	0.45	16	%	$	2.09		$	1.40		49	%
After-tax net realized gains on investments	—			0.01		NMF		0.04			0.10			-60	%
After-tax unrealized gains (losses) on derivative instruments	0.01			0.13		-92	%	(0.11		)	0.30			NMF
Net income	$	0.53		$	0.59	-10	%	$	2.02		$	1.79		13	%
Weighted average shares outstanding (in millions)
Basic shares outstanding	73.9			75.0		-1	%	74.0			75.0			-1	%
Plus: effect of options	0.3			—		NMF		0.2			—			NMF
Plus: effect of restricted stock	0.2			—		NMF		0.2			—			NMF
Diluted shares outstanding	74.5			75.0		-1	%	74.5			75.0			-1	%

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and adjusted book value (c)].

Some amounts may not foot due to rounding.

2

Assured Guaranty Ltd.

Consolidated GAAP Balance Sheets

(dollars in millions)

	As of :
	September 30,			December 31,
	2005			2004
Assets
Fixed maturity securities, at fair value	$	2,192.5		$	1,965.1
Short-term investments, at cost which approximates fair value	62.8			175.8
Total investments	2,255.3			2,140.9
Cash and cash equivalents	7.1			17.0
Accrued investment income	22.7			21.9
Deferred acquisition costs	190.0			186.4
Prepaid reinsurance premiums	12.9			15.2
Reinsurance recoverable on ceded losses	107.2			120.2
Premiums receivable	33.4			40.8
Goodwill	85.4			85.4
Unrealized gains on derivative financial instruments	34.8			43.9
Other assets	18.0			22.3
Total assets	$	2,766.7		$	2,694.0
Liabilities and shareholders’ equity
Liabilities
Unearned premium reserves	$	527.9		$	521.3
Reserves for losses and loss adjustment expenses	201.2			226.5
Profit commissions payable	47.3			61.7
Reinsurance balances payable	17.9			25.1
Current income taxes	12.4			—
Deferred income taxes	17.7			40.1
Funds held by Company under reinsurance contracts	55.1			50.8
Long-term debt	197.3			197.4
Other liabilities	56.2			43.7
Total liabilities	1,133.1			1,166.4
Shareholders’ equity
Common stock	0.7			0.8
Treasury stock	(7.9		)	(7.9		)
Additional paid-in capital	885.4			894.2
Unearned stock grant compensation	(9.4		)	(6.7		)
Retained earnings	711.8			568.3
Accumulated other comprehensive income	52.9			79.0
Total shareholders’ equity	1,633.6			1,527.6
Total liabilities and shareholders’ equity	$	2,766.7		$	2,694.0

3

Assured Guaranty Ltd.

Segment Consolidation (1 of 2)

(dollars in millions)

	Quarter Ended September 30, 2005
	Financial			Financial						Total
	Guaranty			Guaranty			Mortgage			Financial
	Direct			Reinsurance(1)			Guaranty			Guaranty			Other			Total
Present value of financial guaranty gross written premiums (PVP): (a)
Public finance	$	6.3		$	20.2		$	—		$	26.5					$	26.5
Structured finance	33.0			2.3			—			35.3						35.3
Total PVP	$	39.4		$	22.5		$	—		$	61.9					$	61.9
Income statement:
Gross written premiums	$	24.9		$	27.3		$	1.7		$	53.9		$	21.6		$	75.6
Net written premiums	24.2			27.3			1.7			53.2			—			53.2
Net earned premiums	18.3			32.0			4.3			54.5			—			54.5
Loss and loss adjustment expenses	(4.0		)	4.3			0.3			0.6			(1.3		)	(0.8		)
Profit commission expense	—			1.1			0.9			2.0			—			2.0
Acquisition costs	1.6			11.0			0.4			13.0			—			13.0
Operating expenses	9.9			4.3			0.8			15.0			—			15.0
Total underwriting expenses	$	7.5		$	20.7		$	2.4		$	30.6		$	(1.3	)	$	29.2
Underwriting gain	$	10.8		$	11.3		$	1.9		$	24.0		$	1.3		$	25.3
Loss and loss adjustment expense ratio	-21.9		%	13.3		%	6.9		%	1.0		%				-1.5		%
Expense ratio	62.9		%	51.4		%	48.5		%	55.0		%				55.0		%
Combined ratio	41.0		%	64.7		%	55.4		%	56.0		%				53.5		%

	Quarter Ended September 30, 2004
	Financial			Financial						Total
	Guaranty			Guaranty			Mortgage			Financial
	Direct			Reinsurance(1)			Guaranty			Guaranty			Other		Total
PVP:
Public finance	$	—		$	33.9		$	—		$	33.9				$	33.9
Structured finance	7.9			5.0			1.1			14.0					14.0
Total PVP	$	7.9		$	38.9		$	1.1		$	48.0				$	48.0
Income statement:
Gross written premiums	$	16.1		$	35.6		$	5.3		$	57.0		$	5.2	$	62.2
Net written premiums	14.1			35.6			5.3			55.0			—		55.0
Net earned premiums	16.5			31.9			5.1			53.4			—		53.4
Loss and loss adjustment expenses	(1.2		)	10.8			(5.4		)	4.2			—		4.2
Profit commission expense	—			(0.2		)	1.3			1.1			—		1.1
Acquisition costs	1.4			12.1			0.5			14.2			—		14.2
Operating expenses	8.5			4.7			1.0			14.0			—		14.0
Total underwriting expenses	$	8.7		$	27.4		$	(2.6	)	$	33.7		$	—	$	33.7
Underwriting gain	$	7.8		$	4.5		$	7.7		$	20.0		$	—	$	20.0
Loss and loss adjustment expense ratio	-7.3		%	33.9		%	-105.9		%	7.9		%			7.9		%
Expense ratio	59.8		%	51.9		%	55.5		%	54.8		%			54.8		%
Combined ratio	52.5		%	85.8		%	-50.4		%	62.7		%			62.7		%

(1) Due to the timing of receipts of reports prepared by our ceding companies, present value of financial guaranty gross written premiums (PVP) for installment premiums, par written and par outstanding in our Financial Guaranty Reinsurance segment are reported on a one-quarter lag.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and adjusted book value (c)].

4

Assured Guaranty Ltd.

Segment Consolidation (2 of 2)

(dollars in millions)

	Nine Months Ended September 30, 2005
	Financial			Financial						Total
	Guaranty			Guaranty			Mortgage			Financial
	Direct			Reinsurance(1)			Guaranty			Guaranty			Other			Total
Present value of financial guaranty gross written premiums (PVP): (a)
Public finance	$	14.2		$	65.0		$	—		$	79.2					$	79.2
Structured finance	85.3			24.8			13.1			123.1						123.1
Total PVP	$	99.5		$	89.8		$	13.1		$	202.4					$	202.4
Income statement:
Gross written premiums	$	69.6		$	69.5		$	23.0		$	162.1		$	32.0		$	194.1
Net written premiums	67.6			69.2			23.0			159.9			—			159.9
Net earned premiums	54.7			82.2			14.0			150.9			—			150.9
Loss and loss adjustment expenses	(0.5		)	(66.9		)	0.5			(66.9		)	(2.4		)	(69.3		)
Profit commission expense	—			3.4			2.9			6.3			—			6.4
Acquisition costs	4.7			28.6			1.5			34.9			—			34.9
Operating expenses	27.6			14.4			1.9			43.9			—			44.0
Total underwriting expenses	$	31.8		$	(20.5	)	$	6.8		$	18.2		$	(2.4	)	$	15.8
Underwriting gain	$	22.9		$	102.7		$	7.2		$	132.8		$	2.4		$	134.9
Loss and loss adjustment expense ratio	-0.8		%	-81.5		%	3.5		%	-44.3		%				-45.9		%
Expense ratio	59.0		%	56.5		%	44.9		%	56.4		%				56.5		%
Combined ratio	58.2		%	-25.0		%	48.4		%	12.1		%				10.6		%

	Nine Months Ended September 30, 2004
	Financial			Financial						Total
	Guaranty			Guaranty			Mortgage			Financial
	Direct			Reinsurance(1)			Guaranty			Guaranty			Other			Total
PVP:
Public finance	$	2.9		$	110.9		$	—		$	113.8					$	113.8
Structured finance	27.2			46.2			20.3			93.6						93.6
Total PVP	$	30.1		$	157.1		$	20.3		$	207.5					$	207.5
Income statement:
Gross written premiums	$	59.4		$	123.8		$	20.2		$	203.4		$	(78.4	)	$	125.0
Net written premiums	56.7			123.8			20.2			200.7			(182.5		)	18.2
Net earned premiums	73.3			77.8			28.5			179.6			(48.9		)	130.7
Loss and loss adjustment expenses	13.8			13.8			(9.9		)	17.7			(49.9		)	(32.2		)
Profit commission expense	—			0.2			10.6			10.8			0.6			11.4
Acquisition costs	2.9			25.9			3.1			32.0			3.7			35.8
Operating expenses (2)	23.1			12.7			2.8			38.4			3.5			41.9
Total underwriting expenses	$	39.8		$	52.6		$	6.6		$	98.9		$	(42.0	)	$	57.0
Underwriting gain (loss)	$	33.5		$	25.2		$	21.9		$	81.0		$	(7.1	)	$	73.9
Loss and loss adjustment expense ratio	18.8		%	17.7		%	-34.7		%	9.9		%	102.0		%	-24.6		%
Expense ratio	35.4		%	49.8		%	57.8		%	45.2		%	-16.1		%	68.2		%
Combined ratio	54.2		%	67.5		%	23.1		%	55.1		%	85.9		%	43.6		%

(1) Due to the timing of receipts of reports prepared by our ceding companies, present value of financial guaranty gross written premiums (PVP) for installment premiums, par written and par outstanding in our Financial Guaranty Reinsurance segment are reported on a one-quarter lag.

(2) YTD 2004 excludes $11.3 million of operating expenses, related to accelerated vesting of stock awards at the IPO date.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and adjusted book value (c)].

5

Assured Guaranty Ltd.

Financial Guaranty Direct Segment (1 of 2)

(dollars in millions)

	1Q-04			2Q-04			3Q-04			4Q-04			1Q-05			2Q-05			3Q-05			YTD 2004			YTD 2005
Present value of gross written premiums (PVP) (a)	$	7.9		$	14.4		$	7.9		$	39.6		$	37.5		$	22.7		$	39.4		$	30.1		$	99.5
Less: Present value of installment premiums (a)	7.9			14.4			7.9			33.9			35.8			17.6			33.0			30.1			86.4
Upfront gross written premiums (GWP)	—			—			—			5.7			1.7			5.1			6.3			—			13.1
Plus: Installment GWP	25.6			17.7			16.1			15.6			22.1			15.8			18.6			59.4			56.5
Financial guaranty direct GWP	$	25.6		$	17.7		$	16.1		$	21.3		$	23.8		$	20.9		$	24.9		$	59.4		$	69.6
Income statement:
Gross written premiums	$	25.6		$	17.7		$	16.1		$	21.3		$	23.8		$	20.9		$	24.9		$	59.4		$	69.6
Net written premiums	25.3			17.3			14.1			20.9			23.1			20.4			24.2			56.7			67.6
Net earned premiums:
Public finance	—			—			—			0.1			0.1			0.4			0.7			0.1			1.3
Structured finance	40.7			16.1			16.5			15.4			20.3			15.6			17.6			73.2			53.4
Total net earned premiums	40.7			16.1			16.5			15.5			20.4			16.0			18.3			73.3			54.7
Loss and loss adjustment expenses	13.4			1.6			(1.2		)	1.0			(1.5		)	5.0			(4.0		)	13.8			(0.5		)
Profit commission expense	—			—			—			—			—			—			—			—			—
Acquisition costs	1.4			0.1			1.4			1.6			1.5			1.6			1.6			2.9			4.7
Operating expenses (1)	5.5			9.1			8.5			8.6			9.4			8.4			9.9			23.1			27.6
Total expenses	$	20.3		$	10.8		$	8.7		$	11.3		$	9.4		$	15.0		$	7.5		$	39.8		$	31.8
Underwriting gain	$	20.4		$	5.3		$	7.8		$	4.2		$	11.0		$	1.1		$	10.8		$	33.5		$	22.9
Loss and loss adjustment expense ratio	32.9		%	9.9		%	-7.3		%	6.5		%	-7.1		%	31.3		%	-21.9		%	18.8		%	-0.8		%
Expense ratio	17.0		%	57.1		%	59.8		%	66.3		%	53.1		%	62.2		%	62.9		%	35.4		%	59.0		%
Combined ratio	49.9		%	67.0		%	52.5		%	72.8		%	46.0		%	93.5		%	41.0		%	54.2		%	58.2		%

(1)  2Q-04 excludes the allocation of $11.3 million of consolidated operating expenses related to the accelerated vesting of stock awards at the IPO date.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and present value of installment premiums in force adjusted book value (c)].

6

Assured Guaranty Ltd.

Financial Guaranty Direct Segment (2 of 2)

(dollars in millions)

	1Q-04		2Q-04		3Q-04		4Q-04		1Q-05		2Q-05		3Q-05		YTD 2004		YTD 2005
PVP (a):
Public finance	$	—	$	2.9	$	—	$	5.7	$	1.6	$	6.3	$	6.3	$	2.9	$	14.2
Structured finance	7.9		11.4		7.9		33.9		35.9		16.4		33.0		27.2		85.3
Total	$	7.9	$	14.4	$	7.9	$	39.6	$	37.5	$	22.7	$	39.4	$	30.1	$	99.5
U.S.	$	4.2	$	11.1	$	7.9	$	34.6	$	32.5	$	21.2	$	31.6	$	23.2	$	85.4
Non-U.S.	3.7		3.2		—		5.0		4.9		1.5		7.7		6.9		14.1
Total	$	7.9	$	14.4	$	7.9	$	39.6	$	37.5	$	22.7	$	39.4	$	30.1	$	99.5
Par written:
Public finance	$	—	$	246	$	508	$	194	$	77	$	386	$	224	$	754	$	687
Structured finance	1,488		2,444		854		7,263		1,438		2,137		4,987		4,785		8,563
Total	$	1,488	$	2,691	$	1,361	$	7,457	$	1,515	$	2,524	$	5,212	$	5,539	$	9,250
U.S.	$	1,435	$	2,397	$	854	$	7,357	$	1,250	$	2,422	$	4,859	$	4,686	$	8,531
International	53		293		508		100		265		102		353		853		720
Total	$	1,488	$	2,691	$	1,361	$	7,457	$	1,515	$	2,524	$	5,212	$	5,539	$	9,250
Par outstanding:
Public finance	$	2,112	$	2,321	$	2,852	$	3,144	$	3,146	$	3,463	$	3,647	$	2,852	$	3,647
Structured finance	21,737		23,454		23,605		28,468		27,444		26,556		29,751		23,605		29,751
Total	$	23,849	$	25,775	$	26,457	$	31,612	$	30,590	$	30,019	$	33,397	$	26,457	$	33,397
Present value of installment premiums in force: (a)	$	220.6	$	219.7	$	218.9	$	231.0	$	238.3	$	216.4	$	230.4	$	218.9	$	230.4
Unearned premium reserve net of ceded reinsurance	16.0		17.1		14.7		20.3		23.0		27.0		33.2		14.7		33.2

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and present value of installment premiums in force adjusted book value (c)].

7

Assured Guaranty Ltd.

Financial Guaranty Reinsurance Segment (1)(1 of 2)

(dollars in millions)

	1Q-04			2Q-04			3Q-04			4Q-04			1Q-05			2Q-05			3Q-05			YTD 2004			YTD 2005
Present value of gross written premiums (PVP) (a)	$	78.1		$	40.1		$	38.9		$	35.7		$	32.1		$	35.2		$	22.5		$	157.1		$	89.8
Less: Present value of installment premiums (a)	40.0			17.2			14.5			11.6			12.1			20.7			7.2			71.7			40.0
Upfront gross written premiums (GWP)	38.1			22.9			24.5			24.1			20.0			14.6			15.3			85.4			49.8
Less: Upfront premium due to novations (4)	—			—			—			—			—			18.4			—			—			18.4
Plus: Installment GWP (2)	14.3			12.9			11.1			12.4			14.0			12.0			12.0			38.4			38.1
Financial guaranty reinsurance GWP	$	52.4		$	35.8		$	35.6		$	36.5		$	34.0		$	8.2		$	27.3		$	123.8		$	69.5
Income statement:
Gross written premiums	$	52.4		$	35.8		$	35.6		$	36.5		$	34.0		$	8.2		$	27.3		$	123.8		$	69.5
Net written premiums	52.4			35.8			35.6			36.3			34.0			8.0			27.3			123.8			69.2
Net earned premiums:
Scheduled net earned premiums	17.5			21.1			26.7			31.5			21.6			23.6			27.2			65.3			72.4
Net earned premiums from refundings	2.9			4.4			5.2			5.0			1.4			3.6			4.8			12.5			9.8
Total net earned premiums	20.4			25.5			31.9			36.5			23.0			27.2			32.0			77.8			82.2
Loss and loss adjustment expenses	3.9			(0.9		)	10.8			1.6			(7.1		)	(64.1		)	4.3			13.8			(66.9		)
Profit commission expense	0.1			0.3			(0.2		)	0.9			—			2.3			1.1			0.2			3.4
Acquisition costs	7.1			6.7			12.1			13.0			8.1			9.5			11.0			25.9			28.6
Operating expenses (3)	3.0			5.0			4.7			4.8			4.4			5.7			4.3			12.7			14.4
Total expenses	$	14.1		$	11.1		$	27.4		$	20.2		$	5.4		$	(46.6	)	$	20.7		$	52.6		$	(20.5	)
Underwriting gain	$	6.3		$	14.4		$	4.5		$	16.2		$	17.6		$	73.8		$	11.3		$	25.2		$	102.7
Loss and loss adjustment expense ratio	19.1		%	-3.5		%	33.9		%	4.4		%	-30.9		%	-235.7		%	13.3		%	17.7		%	-81.5		%
Expense ratio	50.0		%	47.1		%	51.9		%	51.1		%	54.3		%	64.3		%	51.4		%	49.8		%	56.5		%
Combined ratio	69.1		%	43.6		%	85.8		%	55.5		%	23.4		%	-171.4		%	64.7		%	67.5		%	-25.0		%

(1) Due to the timing of receipts of reports prepared by our ceding companies, present value of financial guaranty gross installment premiums written (PVP), par written and par outstanding in our Financial Guaranty Reinsurance segment are reported on a one-quarter lag.

(2) Installment gross written premiums includes the reclassification of certain deals originally recorded as installment that were discovered during 3Q-04 to be upfront premiums. As a result, prior period amounts have been restated. This reclass had an immaterial impact on our QTD and YTD results of operations and financial condition.

(3) 2Q-04 excludes the allocation of $11.3 million of consolidated operating expenses related to the accelerated vesting of stock awards at the IPO date.

(4) Relates to reassumption by FSA of approximately $820 million par value of healthcare related business.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and present value of installment premiums in force adjusted book value (c)].

8

Assured Guaranty Ltd.

Financial Guaranty Reinsurance Segment (1)(2 of 2)

(dollars in millions)

	1Q-04		2Q-04		3Q-04		4Q-04		1Q-05		2Q-05		3Q-05		YTD 2004		YTD 2005
PVP (a):
Public finance	$	45.8	$	31.2	$	33.9	$	26.4	$	29.0	$	15.8	$	20.2	$	110.9	$	65.0
Structured finance	32.3		8.9		5.0		9.3		3.1		19.4		2.3		46.2		24.8
Total	$	78.1	$	40.1	$	38.9	$	35.7	$	32.1	$	35.2	$	22.5	$	157.1	$	89.8
Par written:
Public finance	$	1,932	$	1,590	$	2,262	$	1,443	$	2,206	$	287	$	1,410	$	5,784	$	3,903
Structured finance	1,154		629		507		861		1,718		704		240		2,290		2,662
Total	$	3,086	$	2,219	$	2,769	$	2,304	$	3,924	$	991	$	1,650	$	8,074	$	6,565
Par outstanding:
Public finance	$	51,806	$	52,061	$	52,926	$	51,324	$	52,579	$	51,039	$	51,110	$	52,926	$	51,110
Structured finance	13,935		13,514		13,084		12,656		13,225		13,809		12,812		13,084		12,812
Total	$	65,741	$	65,575	$	66,010	$	63,980	$	65,804	$	64,848	$	63,922	$	66,010	$	63,922
Present value of installment premiums in force (a)	$	140.3	$	147.2	$	138.0	$	138.9	$	142.9	$	152.3	$	147.4	$	138.0	$	147.4
Unearned premium reserve net of ceded reinsurance	436.4		441.0		444.2		443.8		454.8		435.6		430.9		444.2		430.9

(1) Due to the timing of receipts of reports prepared by our ceding companies, present value of financial guaranty gross installment premiums written (PVP), par written and par outstanding in our Financial Guaranty Reinsurance segment are reported on a one-quarter lag.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and present value of installment premiums in force adjusted book value (c)].

9

Assured Guaranty Ltd.

Mortgage Guaranty Segment

(dollars in millions)

	1Q-04			2Q-04			3Q-04			4Q-04			1Q-05			2Q-05			3Q-05			YTD 2004			YTD 2005
Present value of gross written premiums (PVP) (a)	$	19.2		$	—		$	1.1		$	6.9		$	13.1		$	—		$	—		$	20.3		$	13.1
less: Present value of installment premiums (a)	8.9			—			1.1			6.9			—			—			—			10.0			—
Upfront gross written premiums (GWP)	10.3			—			—			—			13.1			—			—			10.3			13.1
plus: Installment GWP	3.7			0.9			5.3			4.2			6.3			1.9			1.7			9.9			10.0
Mortgage guaranty GWP	$	14.0		$	0.9		$	5.3		$	4.2		$	19.4		$	1.9		$	1.7		$	20.2		$	23.0
Income statement:
Gross written premiums	$	14.0		$	0.9		$	5.3		$	4.2		$	19.4		$	1.9		$	1.7		$	20.2		$	23.0
Net written premiums	14.0			0.9			5.3			4.2			19.4			1.9			1.7			20.2			23.0
Net earned premiums	8.4			15.0			5.1			5.2			4.6			5.1			4.3			28.5			14.0
Loss and loss adjustment expenses	(1.2		)	(3.3		)	(5.4		)	(2.0		)	0.2			—			0.3			(9.9		)	0.5
Profit commission expense	5.0			4.3			1.3			3.5			1.0			1.0			0.9			10.6			2.9
Acquisition costs	0.9			1.7			0.5			0.6			0.5			0.6			0.4			3.1			1.5
Operating expenses (1)	0.6			1.1			1.0			1.0			0.7			0.4			0.8			2.8			1.9
Total expenses	$	5.3		$	3.8		$	(2.6	)	$	3.2		$	2.4		$	2.0		$	2.4		$	6.6		$	6.8
Underwriting gain	$	3.1		$	11.2		$	7.7		$	2.0		$	2.2		$	3.1		$	1.9		$	21.9		$	7.2
Loss and loss adjustment expense ratio	-14.3		%	-22.0		%	-105.9		%	-37.8		%	4.3		%	—			6.9		%	-34.7		%	3.5		%
Expense ratio	77.6		%	47.5		%	55.5		%	98.5		%	47.4		%	39.6		%	48.5		%	57.8		%	44.9		%
Combined ratio	63.3		%	25.5		%	-50.4		%	60.7		%	51.7		%	39.6		%	55.4		%	23.1		%	48.4		%
Risk in force	$	2,201		$	2,394		$	2,437		$	2,325		$	2,582		$	2,547		$	2,389		$	2,437		$	2,389
Risk written	237			—			136			271			419			—			—			372			419
Unearned premium reserve net of ceded reinsurance	57.6			43.5			43.7			42.7			57.5			54.2			51.5			43.7			51.5

(1) 2Q-04 excludes the allocation of $11.3 million of consolidated operating expenses related to the accelerated vesting of stock awards at the IPO date.

Note: Please refer to endnotes for explanation of non-GAAP financial measures [PVP (a), operating income and operating ROE (b), and adjusted book value (c)].

10

Assured Guaranty Ltd.

Other Segment

(dollars in millions)

	1Q-04			2Q-04			3Q-04		4Q-04			1Q-05			2Q-05		3Q-05			YTD 2004			YTD 2005
Income statement:
Gross written premiums	$	(93.6	)	$	10.0		$	5.2	$	3.8		$	0.9		$	9.5	$	21.6		$	(78.4	)	$	32.0
Net written premiums	(98.5		)	(84.0		)	—		—			—			—		—			(182.5		)	—
Net earned premiums	17.2			(66.0		)	—		—			—			—		—			(48.9		)	—
Loss and loss adjustment expenses	7.5			(57.4		)	—		(0.4		)	(1.1		)	—		(1.3		)	(49.9		)	(2.4		)
Profit commission expense	0.4			0.2			—		—			—			—		—			0.6			—
Acquisition costs	3.6			—			—		—			—			—		—			3.7			—
Operating expenses (1)	3.5			—			—		—			—			—		—			3.5			—
Total expenses	$	15.1		$	(57.2	)	$	—	$	(0.4	)	$	(1.1	)	$	—	$	(1.3	)	$	(42.0	)	$	(2.4	)
Underwriting gain (loss)	$	2.1		$	(8.8	)	$	—	$	0.4		$	1.1		$	—	$	1.3		$	(7.1	)	$	2.4
Loss and loss adjustment expense ratio	43.6		%	87.0		%	—		—			—			—		—			102.0		%	—
Expense ratio	44.0		%	-0.3		%	—		—			—			—		—			-16.1		%	—
Combined ratio	87.6		%	86.7		%	—		—			—			—		—			85.9		%	—
Net earned premiums:
Equity layer credit protection	$	5.4		$	—		$	—	$	—		$	—		$	—	$	—		$	5.4		$	—
Trade credit reinsurance	9.3			(34.6		)	—		—			—			—		—			(25.3		)	—
Title reinsurance	2.5			0.8			—		—			—			—		—			3.3			—
Auto residual value reinsurance	—			(32.2		)	—		—			—			—		—			(32.2		)	—
Total net earned premiums	$	17.2		$	(66.0	)	$	—	$	—		$	—		$	—	$	—		$	(48.9	)	$	—
Underwriting gain (loss): (1)
Equity layer credit protection	$	2.5		$	0.5		$	—	$	0.4		$	1.1		$	—	$	1.3		$	3.0		$	2.4
Trade credit reinsurance	1.4			(4.2		)	—		—			—			—		—			(2.8		)	—
Title reinsurance	0.7			0.3			—		—			—			—		—			1.0			—
Auto residual value reinsurance	(2.5		)	(5.4		)	—		—			—			—		—			(7.9		)	—
Total underwriting gain (loss)	$	2.1		$	(8.8	)	$	—	$	0.4		$	1.1		$	—	$	1.3		$	(7.1	)	$	2.4

(1) 2Q-04 excludes the allocation of $11.3 million of consolidated operating expenses related to the accelerated vesting of stock awards at the IPO date.

11

Assured Guaranty Ltd.

Loss and LAE Reserves by Segment, Type of Reserve and by Segment and Type of Reserve

(dollars in millions)

	As of September 30, 2005		As of December 31, 2004
Loss and LAE reserves by segment:
Financial guaranty direct	$	18.6	$	19.9
Financial guaranty reinsurance	78.8		78.8
Mortgage guaranty	11.2		11.2
Other	92.6		116.6
Total	$	201.2	$	226.5

	As of September 30, 2005		As of December 31, 2004
Loss and LAE reserves by type:
Case	$	49.1	$	53.5
IBNR	88.0		105.8
Portfolio	64.1		67.2
Total	$	201.2	$	226.5

	As of September 30, 2005
	Financial Guaranty Direct		Financial Guaranty Reinsurance		Mortgage Guaranty		Total Financial Guaranty		Other		Total
Reserves by segment and type:
Case	$	7.9	$	27.9	$	0.5	$	36.3	$	12.8	$	49.1
IBNR	—		—		8.2		8.2		79.8		88.0
Portfolio	10.7		50.9		2.5		64.1		—		64.1
Total	$	18.6	$	78.8	$	11.2	$	108.6	$	92.6	$	201.2

	As of December 31, 2004
	Financial Guaranty Direct		Financial Guaranty Reinsurance		Mortgage Guaranty		Total Financial Guaranty		Other		Total
Reserves by segment and type:
Case	$	4.3	$	29.1	$	0.8	$	34.2	$	19.3	$	53.5
IBNR	—		—		8.5		8.5		97.3		105.8
Portfolio	15.6		49.7		1.9		67.2		—		67.2
Total	$	19.9	$	78.8	$	11.2	$	109.9	$	116.6	$	226.5

12

Assured Guaranty Ltd.

Investment Portfolio

as of September 30, 2005

(dollars in millions)

	Amortized Cost		Pre-Tax Book Yield		Fair Value		Annualized Investment Income
Fixed maturity securities available for sale:
U.S. Treasury securities and obligations of U.S. government agencies	$	179.3	4.0	%	$	181.7	$	7.2
Agency obligations	184.4		5.3	%	189.4		9.7
Foreign government securities	17.1		4.9	%	17.4		0.8
Obligations of states and political subdivisions	330.7		4.7	%	348.0		15.6
Insured obligations of state and political subdivisions	508.5		4.8	%	540.0		24.6
Corporate securities	137.9		5.6	%	143.1		7.7
Mortgage-backed securities:
Pass-thrus	556.3		5.0	%	556.1		28.0
PACs	76.3		4.6	%	75.6		3.5
Asset-backed securities	141.6		4.2	%	141.3		5.9
Total fixed maturity securities available for sale	2,132.1		4.8	%	2,192.5		103.1
Short-term investments	62.8		3.3	%	62.8		2.0
Total investments	$	2,194.9	4.8	%	$	2,255.3	$	105.1

	Fair Value		%
Ratings distribution(1):
Treasury and U.S. government obligations	$	181.7	8.3	%
Agency obligations	189.4		8.6	%
AAA/Aaa	1,474.9		67.3	%
AA/Aa	252.5		11.5	%
A/A	94.0		4.3	%
BBB/Baa	—		—
Total	$	2,192.5	100.0	%
Duration of investment portfolio (in years):			4.4

(1)  Ratings are represented by the lower of the Moody’s Investor Services and Standard & Poor’s classifications.

13

Assured Guaranty Ltd.

Financial Guaranty Profile (1 of 3)

(dollars in millions)

	Gross Par Written					As of September 30, 2005:
Sector	3Q 2005		3Q 2004			Net Par Outstanding		%		Avg. Rating (7)
U.S. public finance
General obligation	$	292	$	289		$	11,690	12.0	%	A+
Municipal utilities	142		422			10,463		10.8	%	A+
Tax backed	295		679			10,445		10.7	%	A+
Healthcare	342		336			6,223		6.4	%	A
Transportation	292		50			6,102		6.3	%	A
Investor-owned utilities	120		147			1,392		1.4	%	A-
Housing	14		25			1,165		1.2	%	AA-
Higher education	65		56			1,135		1.2	%	A+
Structured municipal (1)	—		—			988		1.0	%	AAA
Other public finance (2)	6		11			734		0.8	%	A+
Total public finance	$	1,568	$	2,015		$	50,337	51.7	%	A+
U.S. structured finance
CDOs (3)	$	3,698	$	221		$	18,794	19.3	%	AA+
Mortgage-backed and home equity	794		655			9,247		9.5	%	AA-
Commercial receivables (4)	294		161			4,349		4.5	%	AA-
Consumer receivables (5)	25		554			2,439		2.5	%	A
Other structured finance (6)	132		133			1,627		1.7	%	AA
Single name corporate CDS	—		—			11		—		A
Total structured finance	$	4,943	$	1,724		$	36,467	37.5	%	AA
International
Structured finance	$	284	$	(364	)	$	6,096	6.3	%	AA-
Project finance/PFI/PPP	56		230			3,222		3.3	%	BBB+
Public finance	10		524			1,197		1.2	%	A-
Total international	$	350	$	390		$	10,516	10.8	%	A
Total exposures	$	6,862	$	4,130		$	97,320	100.0	%	AA-
Mortgage guaranty risk in force	$	—	$	136		$	2,389	NA		NA

(1)  Structured municipal: includes excess of loss reinsurance on portfolios of municipal credits where the Company attached in excess of the AAA rating level.

(2)  Other public finance: primarily includes student loans and government-sponsored project finance.

(3)  Collateralized debt obligations (CDOs) are structured financings backed by a pool of debt obligations. These financings are typically structured in multiple tranches (layers) from equity (first loss) through super senior (high excess). Losses on defaulted pool assets are allocated successively first to the equity tranche then to higher rated tranches.

(4)  Commercial receivables: principally includes equipment leases and commercial mortgage-backed securities.

(5)  Consumer receivables: principally includes auto loan receivables and credit card receivables.

(6)  Other structured finance: predominantly trade receivable securitization, secured structured lending, and future flow transactions.

(7)  Assured Guaranty internal rating. Our scale is comparable to that of the nationally recognized rating agencies.

14

Assured Guaranty Ltd.

Financial Guaranty Profile (2 of 3)

(dollars in millions)

Distribution by ratings of financial guaranty portfolio

	September 30, 2005				December 31, 2004
Ratings (1)	Net Par Outstanding		%		Net Par Outstanding		%
AAA/Aaa	$	31,247	32.1	%	$	29,696	31.1	%
AA/Aa	19,981		20.5	%	19,856		20.8	%
A/A	30,579		31.4	%	31,393		32.8	%
BBB/Baa	14,186		14.6	%	13,137		13.7	%
Below investment grade	1,327		1.4	%	1,509		1.6	%
Total exposures	$	97,320	100.0	%	$	95,592	100.0	%

Distribution by ratings of CDO exposure

	September 30, 2005				December 31, 2004
Ratings (1)	Net Par Outstanding		%		Net Par Outstanding		%
AAA/Aaa	$	16,760	79.3	%	$	12,975	75.2	%
AA/Aa	3,617		17.1	%	2,784		16.1	%
A/A	449		2.1	%	1,155		6.7	%
BBB/Baa	194		0.9	%	216		1.3	%
Below investment grade	112		0.5	%	116		0.7	%
Total exposures	$	21,132	100.0	%	$	17,246	100.0	%

Distribution of CDOs by year of issue as of September 30, 2005

	Net Par Outstanding		%
1999 and prior	$	47	0.2	%
2000	576		2.7	%
2001	4,239		20.1	%
2002	3,538		16.7	%
2003	3,589		17.0	%
2004	1,586		7.5	%
2005 year to date	7,557		35.8	%
	$	21,132	100.0	%

(1)  Assured Guaranty internal rating. Our scale is comparable to that of the nationally recognized rating agencies.

15

Assured Guaranty Ltd.

Financial Guaranty Profile (3 of 3)

(dollars in millions)

Geographic distribution of financial guaranty portfolio, as of September 30, 2005

U.S.:	Net Par Outstanding		%
California	$	7,324	7.5	%
New York	5,694		5.9	%
Texas	3,452		3.5	%
Illinois	2,846		2.9	%
Florida	2,708		2.8	%
New Jersey	2,285		2.3	%
Massachusetts	2,258		2.3	%
Pennsylvania	2,204		2.3	%
Washington	1,766		1.8	%
Puerto Rico	1,530		1.6	%
Other states	18,269		18.8	%
Mortgage and structured (multiple states)	36,467		37.5	%
Total U.S.	$	86,804	89.2	%

International:
United Kingdom	$	5,647	5.8	%
Germany	902		0.9	%
Australia	796		0.8	%
Turkey	367		0.4	%
Brazil	334		0.3	%
Other	2,469		2.5	%
Total International	$	10,516	10.8	%
Total exposures	$	97,320	100.0	%

16

Assured Guaranty Ltd.

Non-Investment Grade Exposures

as of September 30, 2005

(dollars in millions)

Non-Investment Grade Exposures by:

Asset Type	Weighted Average Remaining Life	Net Par Outstanding		Average Rating (6)
Public finance
Transportation	20.5	$	226.9	B
Healthcare	11.3	25.5		BB-
General obligation	8.9	1.0		BB+
Other public finance (1)	14.1	3.5		D
Investor-owned utilities	15.2	11.5		BB-
Municipal utilities	11.2	13.4		C
Tax backed	9.8	9.4		B
Housing	12.0	4.6		B+
Higher education	12.0	1.0		BB+
Project Finance / PPI / PPP	16.3	204.2		B+
Total public finance	17.6	$	500.9	B
Structured finance
Consumer receivables (2)	3.6	$	255.7	BB
Mortgage-backed and home equity	10.9	177.6		CCC+
Commercial receivables (3)	8.8	274.5		B+
CDOs (4)	3.3	112.2		B-
Other structured finance (5)	5.2	6.2		CCC-
Total structured finance	6.9	$	826.2	B+
Total non-investment grade exposures	10.9	$	1,327.1	B+

Top Ten Non-Investment Grade Exposures as of September 30, 2005

Name or Description	Average Rating	Weighted Average Remaining Life	Net Par Outstanding
Public Finance Domestic Project Finance Transaction	B	21.9	$	176
Public Finance International Project Finance Transaction	B	17.8	170
Structured Finance Domestic Credit Card Transaction	BB	3.8	155
Structured Finance Domestic EETC Transaction	B+	9.0	144
Structured Finance Domestic Credit Card Transaction	BB+	3.4	79
Structured Finance Domestic Manufactured Housing Transaction	CCC+	6.8	75
Structured Finance Domestic EETC Transaction	BB	9.8	67
International Airport Facility	BB	8.1	34
Public Finance Domestic Transportation Transaction	BB+	13.1	29
Synthetic CDO - IG Corporate	D	0.1	25
Total	BB-	11.4	$	953

(1)  Other public finance: primarily includes student loans and government-sponsored project finance.

(2)  Consumer receivables: principally includes auto loan receivables and credit card receivables.

(3)  Commercial receivables: principally includes equipment leases and commercial mortgage-backed securities.

(4)  Collateralized debt obligations (CDOs) are structured financings backed by a pool of debt obligations. These financings are typically structured in multiple tranches (layers) from equity (first loss) through super senior (high excess). Losses on defaulted pool assets are allocated successively first to the equity tranche then to higher rated tranches.

(5)  Other structured finance: predominantly trade receivable securitization, secured structured lending, and future flow transactions.

(6)  Assured Guaranty internal rating. Our scale is comparable to that of the nationally recognized rating agencies.

17

Assured Guaranty Ltd.

Closely Monitored Credits (“CMC”)

(dollars in millions)

Net par outstanding by credit monitoring category (1)

	September 30, 2005
Description	Net Par Outstanding		%		Number of Credits in Category
Fundamentally sound risk	$	95,713	98.4	%
Closely monitored credits:
Category 1	993		1.0	%	43
Category 2	353		0.4	%	11
Category 3	149		0.1	%	18
Category 4	12		—		10
CMC Total	1,507		1.5	%	82
Other below investment grade risk	100		0.1	%	137
Total	$	97,320	100.0	%

	December 31, 2004
Description	Net Par Outstanding		%		Number of Credits in Category
Fundamentally sound risk	$	93,602	97.9	%
Closely monitored credits:
Category 1	1,490		1.6	%	35
Category 2	165		0.2	%	9
Category 3	70		0.1	%	16
Category 4	12		—		8
CMC Total	1,737		1.8	%	68
Other below investment grade risk	253		0.3	%	144
Total	$	95,592	100.0	%

(1)  Our risk management department is responsible for monitoring our portfolio of credits and maintains a list of closely monitored credits. The closely monitored credits are divided into four categories: Category 1 (low priority; fundamentally sound, greater than normal risk); Category 2 (medium priority; weakening credit profile, may result in loss); Category 3 (high priority; claim/default probable, case reserve established); Category 4 (claim paid, case reserve established for future payments). Credits that are not included in the closely monitored credit list are categorized as fundamentally sound, normal risk.

18

Assured Guaranty Ltd.

Largest Exposures by Sector (Part 1 of 2)

as of September 30, 2005

(dollars in millions)

10 Largest U.S. Public Finance Exposures

Revenue Source	Net Par Outstanding		Rating(1)
California State General Obligation & Leases	$	790	A-
New Jersey State General Obligation & Leases	747		AA-
Long Island Power Authority	711		A-
New York City General Obligation	640		A
New York City Municipal Water Finance Authority	629		AA+
Denver Colorado Airport System	627		A
Massachusetts State General Obligation & Bay Transportation	583		AA-
Jefferson County Alabama Sewer	578		A
Houston Texas Water & Sewer System	562		A+
Chicago Illinois General Obligation	536		A+
Total top 10 public finance exposures	$	6,404

10 Largest U.S. Structured Finance Exposures

Revenue Source	Net Par Outstanding		Rating(1)
Park Place 2004-MHQ1 Class A-1	$	1,036	AAA
Structured Finance Corporate Pool	781		AA
Synthetic CDO - IG Corporate	740		AAA
Ameriquest Mortgage Inc. 2004-R10 A-1	685		AAA
Argent Securities Inc. 2004-W11 A-1	640		AAA
Synthetic CDO - IG ABS	594		AAA
Synthetic CDO - IG Corporate	571		AAA
Synthetic Credit Card Master Trust	550		AAA
Synthetic CDO - IG Corporate	500		AAA
Field Point I & II, Limited Class A1 & A2	447		AA-
Total top 10 structured finance exposures	$	6,545

(1) Assured Guaranty internal rating. Our scale is comparable to that of the nationally recognized rating agencies.

19

Assured Guaranty Ltd.

Largest Exposures by Sector (Part 2 of 2)

as of September 30, 2005

(dollars in millions)

10 Largest Healthcare Exposures

Revenue Source	Net Par Outstanding(2)		Rating(1)	State
Public Finance Domestic Hospital System	$	205	A-	CA
Public Finance Domestic Hospital System	187		A+	TX
Public Finance Domestic Hospital System	176		AA-	CA
Public Finance Domestic Hospital System	158		AA	MO
Public Finance Domestic Hospital System	113		A+	PA
Public Finance Domestic Hospital System	112		BBB+	NJ
Public Finance Domestic Hospital System	110		BBB	MD
Public Finance Domestic Hospital - Stand Alone	102		AA	TX
Public Finance Domestic Hospital System	98		BBB+	MN
Public Finance Domestic Health Care - Pool	91		BBB+	MD
Total top 10 healthcare exposures	$	1,351

10 Largest International Exposures

Revenue Source	Net Par Outstanding		Rating(1)
Synthetic CDO - IG ABS	$	584	AAA
Synthetic CDO - IG Corporate	500		AAA
Structured Finance - International Whole Business Securitization	276		BBB+
Structured Finance - International Equipment Lease Transaction	230		A
Synthetic CDO - IG Corporate	200		AAA
Public Finance - International Project Finance Transaction	190		BBB+
Dekania Europe CDO I PLC	185		AAA
Structured Finance - International Residential Mortgage Transaction	168		A+
Structured Finance - International Future Flow Transaction	165		BBB-
Synthetic CDO - IG Corporate	153		AAA
Total top 10 international exposures	$	2,650

(1) Assured Guaranty internal rating. Our scale is comparable to that of the nationally recognized rating agencies.

(2) Excludes net par in force for transactions insured by a AAA monoline financial guaranty company.

20

Assured Guaranty Ltd.

Consolidated Capital and Claims Paying Resources

(dollars in millions)

	As of September 30, 2005						As of December 31, 2004
	AGC		AG Re (1)		Consolidated		AGC		AG Re (1)		Consolidated
Statutory surplus and reserves
Unearned premium reserve (2)	$	226	$	352	$	578	$	406	$	186	$	592
Contingency reserve	556		—		556		518		—		518
Policyholders’ surplus	283		676		959		237		596		833
Loss & loss adjustment expense reserves	13		114		127		32		103		135
Total policyholders’ surplus & reserves	$	1,078	$	1,142	$	2,220	$	1,193	$	885	$	2,078
Claims paying resources
Policyholders’ surplus	$	283	$	676	$	959	$	237	$	596	$	833
Contingency reserve	556		—		556		518		—		518
Qualified statutory capital	839		676		1,515		755		596		1,351
Unearned premium reserve (2)	226		352		578		406		186		592
Loss & loss adjustment expense reserves	13		114		127		32		103		135
Total policyholders’ surplus & reserves	1,078		1,142		2,220		1,193		885		2,078
Present value of installment premium	241		161		402		268		132		400
Standby line of credit/stop loss	455		—		455		255		—		255
Total claims paying resources	$	1,774	$	1,303	$	3,077	$	1,716	$	1,017	$	2,734
Net par insured outstanding	$	53,116	$	44,203	$	97,320	$	74,001	$	21,590	$	95,592
Net debt service outstanding	$	71,537	$	67,556	$	139,093	$	105,831	$	30,288	$	136,120
Ratios:
Net par insured to statutory capital	63:1		65:1		64:1		98:1		36:1		71:1
Capital ratio(3)	85:1		100:1		92:1		140:1		51:1		101:1
Financial resources ratio(4)	40:1		52:1		45:1		62:1		30:1		50:1

(1) AG Re numbers are our estimate of US statutory as the company files Bermuda statutory financial statements.

(2) Unearned premium reserve for AG Re is U.S. GAAP based and net of prepaid reinsurance premiums.

(3) Capital ratio is net par and interest insured divided by qualified statutory capital.

(4) Financial resources ratio is calculated by dividing net par and interest insured by total claims paying resources.

21

Assured Guaranty Ltd.

Summary Financial and Statistical Data

(dollars in millions, except per share amounts)

	YTD 2005			2004			2003			2002			2001			2000
GAAP Summary Income Statement Data
Gross premiums written	$	194.1		$	190.9		$	349.2		$	417.2		$	442.9		$	206.0
Net earned premiums	150.9			187.9			310.9			247.4			293.5			140.7
Net investment income	71.2			94.8			96.3			97.2			99.5			98.1
Total expenses	29.2			114.6			266.1			218.8			282.8			131.8
Income before provision for income taxes	187.6			233.3			246.2			83.2			110.1			118.1
Net income	150.3			182.8			214.5			72.6			63.8			93.2
Operating income	155.4			141.1			127.3			115.7			96.1			87.6
Net income per diluted share	$	2.02		$	2.44		$	2.86		$	0.97		$	0.85		$	1.24
Operating income per diluted share	$	2.09		$	1.88		$	1.70		$	1.54		$	1.28		$	1.17
Financial Ratios
Loss and LAE ratio	-45.9		%	-17.0		%	46.5		%	48.6		%	60.5		%	21.6		%
Expense ratio	56.5		%	65.4		%	37.2		%	35.5		%	30.6		%	61.2		%
Combined ratio	10.6		%	48.4		%	83.7		%	84.1		%	91.1		%	82.8		%
GAAP Summary Balance Sheet Data (end of period)
Total investments and cash	$	2,262.4		$	2,157.9		$	2,222.1		$	2,061.9		$	1,710.8		$	1,549.6
Total assets	2,766.7			2,694.0			2,857.9			2,719.9			2,322.1			1,913.7
Unearned premium reserves	527.9			521.3			625.4			613.3			500.3			444.6
Loss and LAE reserves	201.2			226.5			522.6			458.8			401.1			171.0
Long-term debt	197.3			197.4			75.0			75.0			150.0			150.0
Shareholders’ equity	1,633.6			1,527.6			1,437.6			1,257.2			1,061.6			994.5
Book value per share	$	21.81		$	20.19		$	19.17		$	16.76		$	14.15		$	13.26
Other Financial Information
Net debt service outstanding (end of period)	$	139,093		$	136,120		$	130,047		$	124,082		$	117,909		$	102,744
Net par outstanding (end of period)	97,320			95,592			87,524			80,394			75,249			65,756
Gross par outstanding (end of period)	100,281			98,221			90,366			83,067			79,883			67,730
Consolidated qualified statutory capital	1,515			1,351			1,216			1,133			1,095			1,004
Consolidated policyholders’ surplus & reserves	2,220			2,078			1,145			2,041			1,744			1,482
Ratios:
Par insured to statutory capital	64:1			71:1			72:1			71:1			69:1			66:1
Capital ratio(1)	92:1			101:1			107:1			110:1			108:1			102:1
Financial resources ratio(2)	45:1			50:1			43:1			40:1			50:1			56:1
Debt service written:
Public finance	$	10,791		$	14,493		$	12,130		$	14,312		$	8,694		$	7,385
Structured finance	11,893			16,477			11,038			13,210			12,627			9,054
Total debt service written	$	22,684		$	30,970		$	23,168		$	27,522		$	21,321		$	16,439
U.S.	$	19,952		$	27,073		$	19,346		$	25,453		$	19,196		$	15,451
International	2,732			3,897			3,822			2,069			2,125			988
Total debt service written	$	22,684		$	30,970		$	23,168		$	27,522		$	21,321		$	16,439

(1) Capital ratio is net par and interest insured divided by qualified statutory capital.

(2) Financial resources ratio is calculated by dividing net par and interest insured by total claims paying resources.

22

Endnotes related to non-GAAP financial measures discussed in the operating supplement:

(a) PVP, which is a non-GAAP measure, represents gross premiums related to financial guaranty and mortgage guaranty contracts written in the current period, including upfront and installment premiums received on contracts written in the current period and the present value of estimated future installment premiums, discounted at 6% per year.   We use 6% as the present value discount because it is the approximate taxable equivalent yield on our investment portfolio for the periods presented.  Present value of installment premiums in-force, which is a non-GAAP measure, represents our future premiums on our in-force book of installment premium business in our financial guaranty direct and financial guaranty reinsurance segments. It is calculated net of reinsurance ceded and using a discount rate of 6%. We believe PVP and Present value of installment premiums in-force are useful measures for management, equity analysts and investors because they permit the evaluation of the value of new business production for Assured Guaranty by taking into account the value of installment premiums on new contracts underwritten in a reporting period, which the GAAP gross premiums written does not adequately measure.

(b) Operating income, which is a non-GAAP financial measure, is defined as net income excluding after-tax realized gains (losses) on investments and after-tax unrealized gains (losses) on derivative financial instruments.  Operating ROE represents operating income as a percentage of average shareholder’s equity, excluding accumulated other comprehensive income (AOCI).  We believe the presentation of operating income and operating ROE enhances the understanding of our results of operations by highlighting the underlying profitability of our insurance business.  We exclude net realized gains (losses) on investments and net unrealized gains (losses) on derivative financial instruments because the amount of these gains (losses) is heavily influenced by, and fluctuates in part according to, the market interest rates, credit spreads and other factors that management cannot control or predict.  This measure should not be viewed as a substitute for net income determined in accordance with GAAP.

(c) Adjusted book value, which is a non-GAAP financial measure, is derived by beginning with shareholder’s equity (book value) and adding or subtracting the after-tax value of: the financial guaranty and mortgage guaranty net unearned premium reserve; deferred acquisition costs and the present value of estimated net future installment premiums (discounted at 6%).  The adjustments described above will not be realized until future periods and may differ materially from the amounts used in determining adjusted book value.  Management, investors and analysts use the calculation of adjusted book value to evaluate the net present value of the Company’s in-force premium and capital base.

	Contacts:
	Equity investors and media
	Sabra Purtill
	Managing Director, Investor Relations
	(212) 408-6044
	spurtill@assuredguaranty.com
	Chris McNamee
	Assistant Vice President, Investor Relations
	(212) 261-5509
	cmcnamee@assuredguaranty.com
	Fixed income investors
	Patrick Early
	Director, Fixed Income Investor Relations
	(212) 408 6043
	pearly@assuredguaranty.com
Assured Guaranty Ltd.	Michael Walker
30 Woodbourne Avenue	Director, Fixed Income Investor Relations
Hamilton HM 08 Bermuda	(212) 261-5575
www.assuredguaranty.com	mwalker@assuredguaranty.com