Subsidiary Information (Tables)

3 Months Ended

Mar. 31, 2015

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF MARCH 31, 2015

(in millions)



	Assured Guaranty Ltd. (Parent)		AGUS (Issuer)		AGMH (Issuer)		Other Entities		Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
ASSETS
Total investment portfolio and cash	$	47	$	82	$	23	$	11,347	$	(300	)	$	11,199
Investment in subsidiaries	5,722		5,087		3,955		350		(15,114		)	—
Premiums receivable, net of commissions payable	—		—		—		830		(130		)	700
Ceded unearned premium reserve	—		—		—		1,430		(1,065		)	365
Deferred acquisition costs	—		—		—		184		(64		)	120
Reinsurance recoverable on unpaid losses	—		—		—		344		(267		)	77
Credit derivative assets	—		—		—		262		(185		)	77
Deferred tax asset, net	—		56		—		251		(89		)	218
Intercompany receivable	—		200		—		90		(290		)	—
Financial guaranty variable interest entities’ assets, at fair value	—		—		—		1,499		—			1,499
Other	21		79		31		522		(231		)	422
TOTAL ASSETS	$	5,790	$	5,504	$	4,009	$	17,109	$	(17,735	)	$	14,677
LIABILITIES AND SHAREHOLDERS’ EQUITY
Unearned premium reserves	$	—	$	—	$	—	$	5,173	$	(1,046	)	$	4,127
Loss and LAE reserve	—		—		—		1,062		(275		)	787
Long-term debt	—		847		439		18		—			1,304
Intercompany payable	—		90		—		500		(590		)	—
Credit derivative liabilities	—		—		—		1,044		(185		)	859
Deferred tax liabilities, net	—		—		93		—		(93		)	—
Financial guaranty variable interest entities’ liabilities, at fair value	—		—		—		1,423		—			1,423
Other	4		23		22		702		(360		)	391
TOTAL LIABILITIES	4		960		554		9,922		(2,549		)	8,891
TOTAL SHAREHOLDERS’ EQUITY ATTRIBUTABLE TO ASSURED GUARANTY LTD.	5,786		4,544		3,455		6,837		(14,836		)	5,786
Noncontrolling interest	—		—		—		350		(350		)	—
TOTAL SHAREHOLDERS' EQUITY	5,786		4,544		3,455		7,187		(15,186		)	5,786
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	5,790	$	5,504	$	4,009	$	17,109	$	(17,735	)	$	14,677

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2014

(in millions)



	Assured Guaranty Ltd. (Parent)		AGUS (Issuer)		AGMH (Issuer)		Other Entities		Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
ASSETS
Total investment portfolio and cash	$	126	$	204	$	47	$	11,382	$	(300	)	$	11,459
Investment in subsidiaries	5,612		5,072		3,965		339		(14,988		)	—
Premiums receivable, net of commissions payable	—		—		—		864		(135		)	729
Ceded unearned premium reserve	—		—		—		1,469		(1,088		)	381
Deferred acquisition costs	—		—		—		186		(65		)	121
Reinsurance recoverable on unpaid losses	—		—		—		338		(260		)	78
Credit derivative assets	—		—		—		277		(209		)	68
Deferred tax asset, net	—		54		—		295		(89		)	260
Intercompany receivable	—		—		—		90		(90		)	—
Financial guaranty variable interest entities’ assets, at fair value	—		—		—		1,402		—			1,402
Other	27		77		27		538		(242		)	427
TOTAL ASSETS	$	5,765	$	5,407	$	4,039	$	17,180	$	(17,466	)	$	14,925
LIABILITIES AND SHAREHOLDERS’ EQUITY
Unearned premium reserves	$	—	$	—	$	—	$	5,328	$	(1,067	)	$	4,261
Loss and LAE reserve	—		—		—		1,066		(267		)	799
Long-term debt	—		847		437		19		—			1,303
Intercompany payable	—		90		—		300		(390		)	—
Credit derivative liabilities	—		—		—		1,172		(209		)	963
Deferred tax liabilities, net	—		—		94		—		(94		)	—
Financial guaranty variable interest entities’ liabilities, at fair value	—		—		—		1,419		—			1,419
Other	7		9		16		764		(374		)	422
TOTAL LIABILITIES	7		946		547		10,068		(2,401		)	9,167
TOTAL SHAREHOLDERS’ EQUITY ATTRIBUTABLE TO ASSURED GUARANTY LTD.	5,758		4,461		3,492		6,773		(14,726		)	5,758
Noncontrolling interest	—		—		—		339		(339		)	—
TOTAL SHAREHOLDERS’ EQUITY	5,758		4,461		3,492		7,112		(15,065		)	5,758
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	5,765	$	5,407	$	4,039	$	17,180	$	(17,466	)	$	14,925

Condensed Consolidating Statement of Operations and Comprehensive Income

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2015

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
REVENUES
Net earned premiums	$	—		$	—		$	—		$	140		$	2		$	142
Net investment income	0			0			0			104			(3		)	101
Net realized investment gains (losses)	0			0			0			19			(3		)	16
Net change in fair value of credit derivatives:
Realized gains (losses) and other settlements	—			—			—			21			0			21
Net unrealized gains (losses)	—			—			—			103			—			103
Net change in fair value of credit derivatives	—			—			—			124			0			124
Other	—			—			—			(14		)	—			(14		)
TOTAL REVENUES	0			0			—			373			(4		)	369
EXPENSES
Loss and LAE	—			—			—			18			0			18
Amortization of deferred acquisition costs	—			—			—			6			(2		)	4
Interest expense	—			13			13			4			(5		)	25
Other operating expenses	8			0			0			48			0			56
TOTAL EXPENSES	8			13			13			76			(7		)	103
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN NET EARNINGS OF SUBSIDIARIES	(8		)	(13		)	(13		)	297			3			266
Total (provision) benefit for income taxes	—			5			5			(72		)	(3		)	(65		)
Equity in net earnings of subsidiaries	209			163			92			9			(473		)	—
NET INCOME (LOSS)	$	201		$	155		$	84		$	234		$	(473	)	$	201
Less: noncontrolling interest	—			—			—			9			(9		)	—
NET INCOME (LOSS) ATTRIBUTABLE TO ASSURED GUARANTY LTD.	$	201		$	155		$	84		$	225		$	(464	)	$	201

COMPREHENSIVE INCOME (LOSS)	$	201		$	134		$	80		$	233		$	(447	)	$	201

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2014

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
REVENUES
Net earned premiums	$	—		$	—		$	—		$	131		$	1		$	132
Net investment income	0			0			0			105			(2		)	103
Net realized investment gains (losses)	0			—			0			4			(2		)	2
Net change in fair value of credit derivatives:
Realized gains (losses) and other settlements	—			—			—			19			0			19
Net unrealized gains (losses)	—			—			—			(230		)	—			(230		)
Net change in fair value of credit derivatives	—			—			—			(211		)	0			(211		)
Other	—			—			—			169			—			169
TOTAL REVENUES	0			0			0			198			(3		)	195
EXPENSES
Loss and LAE	—			—			—			39			2			41
Amortization of deferred acquisition costs	—			—			—			6			(1		)	5
Interest expense	—			7			13			5			(5		)	20
Other operating expenses	8			0			0			53			(1		)	60
TOTAL EXPENSES	8			7			13			103			(5		)	126
INCOME (LOSS) BEFORE INCOME TAXES AND EQUITY IN NET EARNINGS OF SUBSIDIARIES	(8		)	(7		)	(13		)	95			2			69
Total (provision) benefit for income taxes	—			2			5			(33		)	(1		)	(27		)
Equity in net earnings of subsidiaries	50			87			169			8			(314		)	—
NET INCOME (LOSS)	$	42		$	82		$	161		$	70		$	(313	)	$	42
Less: noncontrolling interest	—			—			—			8			(8		)	—
NET INCOME (LOSS) ATTRIBUTABLE TO ASSURED GUARANTY LTD.	$	42		$	82		$	161		$	62		$	(305	)	$	42

COMPREHENSIVE INCOME (LOSS)	$	146		$	165		$	212		$	258		$	(635	)	$	146

Condensed Consolidating Statement of Cash Flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2015

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Net cash flows provided by (used in) operating activities	$	97		$	127		$	59		$	34		$	(294	)	$	23
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(46		)	(6		)	(396		)	—			(448		)
Sales	—			122			11			708			—			841
Maturities	—			4			—			151			—			155
Sales (purchases) of short-term investments, net	79			43			19			279			—			420
Net proceeds from financial guaranty variable entities’ assets	—			—			—			30			—			30
Intercompany debt	—			(200		)	—			—			200			—
Investment in subsidiary	—			—			25			—			(25		)	—
Other	—			—			—			3			—			3
Net cash flows provided by (used in) investing activities	79			(77		)	49			775			175			1,001
Cash flows from financing activities
Return of capital	—			—			—			(25		)	25			—
Dividends paid	(19		)	(50		)	(108		)	(136		)	294			(19		)
Repurchases of common stock	(152		)	—			—			—			—			(152		)
Share activity under option and incentive plans	(5		)	—			—			—			—			(5		)
Net paydowns of financial guaranty variable entities’ liabilities	—			—			—			(39		)	—			(39		)
Payment of long-term debt	—			—			—			(1		)	—			(1		)
Intercompany debt	—			—			—			200			(200		)	—
Other	—			—			—			4			—			4
Net cash flows provided by (used in) financing activities	(176		)	(50		)	(108		)	3			119			(212		)
Effect of exchange rate changes	—			—			—			(2		)	—			(2		)
Increase (decrease) in cash	—			—			—			810			—			810
Cash at beginning of period	0			0			4			71			—			75
Cash at end of period	$	0		$	0		$	4		$	881		$	—		$	885

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2014

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Net cash flows provided by (used in) operating activities	$	58		$	0		$	(6	)	$	111		$	(62	)	$	101
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(1		)	(3		)	(513		)	—			(517		)
Sales	—			—			—			155			—			155
Maturities	—			—			—			148			—			148
Sales (purchases) of short-term investments, net	(3		)	—			(16		)	203			—			184
Net proceeds from financial guaranty variable entities’ assets	—			—			—			286			—			286
Intercompany debt	—			—			—			—			—			—
Investment in subsidiary	—			—			25			—			(25		)	—
Other	—			—			—			19			—			19
Net cash flows provided by (used in) investing activities	(3		)	(1		)	6			298			(25		)	275
Cash flows from financing activities
Return of capital	—			—			—			(25		)	25			—
Dividends paid	(20		)	—			—			(62		)	62			(20		)
Repurchases of common stock	(35		)	—			—			—			—			(35		)
Share activity under option and incentive plans	0			—			—			—			—			0
Net paydowns of financial guaranty variable entities’ liabilities	—			—			—			(281		)	—			(281		)
Payment of long-term debt	—			—			—			(6		)	—			(6		)
Intercompany debt	—			—			—			—			—			—
Net cash flows provided by (used in) financing activities	(55		)	—			—			(374		)	87			(342		)
Effect of exchange rate changes	—			—			—			1			—			1
Increase (decrease) in cash	—			(1		)	—			36			—			35
Cash at beginning of period	0			67			0			117			—			184
Cash at end of period	$	0		$	66		$	0		$	153		$	—		$	219