Subsidiary Information (Tables)

6 Months Ended

Jun. 30, 2019

Condensed Financial Information Disclosure [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF JUNE 30, 2019

(in millions)



	Assured Guaranty Ltd. (Parent)		AGUS (Issuer) (1)		AGMH (Issuer)		Other Entities		Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Assets
Total investment portfolio and cash	$	27	$	397	$	17	$	10,972	$	(430	)	$	10,983
Investment in subsidiaries	6,620		5,937		4,196		199		(16,952		)	—
Premiums receivable, net of commissions payable	—		—		—		1,020		(154		)	866
Deferred acquisition costs	—		—		—		142		(36		)	106
Intercompany loan receivable	—		—		—		50		(50		)	—
FG VIEs’ assets, at fair value	—		—		—		526		—			526
Dividends receivable from affiliate	60		—		—		—		(60		)	—
Other	27		82		30		2,687		(1,726		)	1,100
Total assets	$	6,734	$	6,416	$	4,243	$	15,596	$	(19,408	)	$	13,581
Liabilities and shareholders' equity
Unearned premium reserves	$	—	$	—	$	—	$	4,290	$	(903	)	$	3,387
Loss and LAE reserve	—		—		—		1,363		(261		)	1,102
Long-term debt	—		844		472		5		(88		)	1,233
Intercompany loan payable	—		50		—		300		(350		)	—
Credit derivative liabilities	—		—		—		259		(35		)	224
FG VIEs’ liabilities, at fair value	—		—		—		551		—			551
Dividends payable to affiliate	—		60		—		—		(60		)	—
Other	12		66		68		918		(702		)	362
Total liabilities	12		1,020		540		7,686		(2,399		)	6,859
Total shareholders' equity attributable to Assured Guaranty Ltd.	6,722		5,396		3,703		7,711		(16,810		)	6,722
Noncontrolling interest	—		—		—		199		(199		)	—
Total shareholders' equity	6,722		5,396		3,703		7,910		(17,009		)	6,722
Total liabilities and shareholders' equity	$	6,734	$	6,416	$	4,243	$	15,596	$	(19,408	)	$	13,581

____________________


(1)	The fair value of the AGMH debt purchased by AGUS, and recorded in the AGUS investment portfolio, was $129 million.

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 2018

(in millions)



	Assured Guaranty Ltd. (Parent)		AGUS (Issuer) (1)		AGMH (Issuer)		Other Entities		Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Assets
Total investment portfolio and cash	$	45	$	334	$	23	$	11,000	$	(425	)	$	10,977
Investment in subsidiaries	6,440		5,835		3,991		226		(16,492		)	—
Premiums receivable, net of commissions payable	—		—		—		1,071		(167		)	904
Deferred acquisition costs	—		—		—		143		(38		)	105
Deferred tax asset, net	—		—		—		162		(94		)	68
Intercompany loan receivable	—		—		—		50		(50		)	—
FG VIEs’ assets, at fair value	—		—		—		569		—			569
Dividends receivable from affiliate	60		—		—		—		(60		)	—
Other	29		66		24		2,437		(1,576		)	980
Total assets	$	6,574	$	6,235	$	4,038	$	15,658	$	(18,902	)	$	13,603
Liabilities and shareholders' equity
Unearned premium reserves	$	—	$	—	$	—	$	4,452	$	(940	)	$	3,512
Loss and LAE reserve	—		—		—		1,467		(290		)	1,177
Long-term debt	—		844		468		5		(84		)	1,233
Intercompany loan payable	—		50		—		300		(350		)	—
Credit derivative liabilities	—		—		—		236		(27		)	209
Deferred tax liabilities, net	—		49		50		—		(99		)	—
FG VIEs’ liabilities, at fair value	—		—		—		619		—			619
Dividends payable to affiliate	—		60		—		—		(60		)	—
Other	19		3		17		763		(504		)	298
Total liabilities	19		1,006		535		7,842		(2,354		)	7,048
Total shareholders' equity attributable to Assured Guaranty Ltd.	6,555		5,229		3,503		7,590		(16,322		)	6,555
Noncontrolling interest	—		—		—		226		(226		)	—
Total shareholders' equity	6,555		5,229		3,503		7,816		(16,548		)	6,555
Total liabilities and shareholders' equity	$	6,574	$	6,235	$	4,038	$	15,658	$	(18,902	)	$	13,603

____________________

(1)

The fair value of the AGMH debt purchased by AGUS, and recorded in the AGUS investment portfolio, was $125 million.

Condensed Consolidating Statement of Operations and Comprehensive Income

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED JUNE 30, 2019

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	114		$	(2	)	$	112
Net investment income	—			4			—			110			(4		)	110
Net realized investment gains (losses)	—			—			—			8			—			8
Net change in fair value of credit derivatives	—			—			—			(8		)	—			(8		)
Other	2			—			—			93			(51		)	44
Total revenues	2			4			—			317			(57		)	266
Expenses
Loss and LAE	—			—			—			5			(6		)	(1		)
Amortization of deferred acquisition costs	—			—			—			5			(1		)	4
Interest expense	—			13			14			1			(6		)	22
Other operating expenses	10			1			—			98			(49		)	60
Total expenses	10			14			14			109			(62		)	85
Equity in net earnings of investees	—			(1		)	—			2			—			1
Income (loss) before income taxes and equity in net earnings of subsidiaries	(8		)	(11		)	(14		)	210			5			182
Total (provision) benefit for income taxes	—			2			3			(44		)	(1		)	(40		)
Equity in net earnings of subsidiaries	150			154			95			5			(404		)	—
Net income (loss)	$	142		$	145		$	84		$	171		$	(400	)	$	142
Less: noncontrolling interest	—			—			—			5			(5		)	—
Net income (loss) attributable to Assured Guaranty Ltd.	$	142		$	145		$	84		$	166		$	(395	)	$	142

Comprehensive income (loss)	$	176		$	145		$	109		$	206		$	(460	)	$	176

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED JUNE 30, 2018

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	139		$	(3	)	$	136
Net investment income	—			2			—			99			(3		)	98
Net realized investment gains (losses)	—			—			—			(2		)	—			(2		)
Net change in fair value of credit derivatives	—			—			—			48			—			48
Other	3			—			—			(9		)	(54		)	(60		)
Total revenues	3			2			—			275			(60		)	220
Expenses
Loss and LAE	—			—			—			46			(2		)	44
Amortization of deferred acquisition costs	—			—			—			5			(1		)	4
Interest expense	—			12			14			2			(4		)	24
Other operating expenses	10			—			1			95			(44		)	62
Total expenses	10			12			15			148			(51		)	134
Equity in net earnings of investees	—			—			—			1			—			1
Income (loss) before income taxes and equity in net earnings of subsidiaries	(7		)	(10		)	(15		)	128			(9		)	87
Total (provision) benefit for income taxes	—			2			3			(20		)	3			(12		)
Equity in net earnings of subsidiaries	82			64			9			6			(161		)	—
Net income (loss)	$	75		$	56		$	(3	)	$	114		$	(167	)	$	75
Less: noncontrolling interest	—			—			—			6			(6		)	—
Net income (loss) attributable to Assured Guaranty Ltd.	$	75		$	56		$	(3	)	$	108		$	(161	)	$	75

Comprehensive income (loss)	$	13		$	7		$	(53	)	$	52		$	(6	)	$	13

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2019

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	235		$	(5	)	$	230
Net investment income	—			6			—			211			(9		)	208
Net realized investment gains (losses)	—			—			—			(4		)	—			(4		)
Net change in fair value of credit derivatives	—			—			—			(30		)	—			(30		)
Other	4			—			—			159			(106		)	57
Total revenues	4			6			—			571			(120		)	461
Expenses
Loss and LAE	—			—			—			52			(7		)	45
Amortization of deferred acquisition costs	—			—			—			12			(2		)	10
Interest expense	—			25			27			5			(12		)	45
Other operating expenses	20			2			—			205			(103		)	124
Total expenses	20			27			27			274			(124		)	224
Equity in net earnings of investees	—			—			—			3			—			3
Income (loss) before income taxes and equity in net earnings of subsidiaries	(16		)	(21		)	(27		)	300			4			240
Total (provision) benefit for income taxes	—			4			6			(53		)	(1		)	(44		)
Equity in net earnings of subsidiaries	212			204			163			9			(588		)	—
Net income (loss)	$	196		$	187		$	142		$	256		$	(585	)	$	196
Less: noncontrolling interest	—			—			—			9			(9		)	—
Net income (loss) attributable to Assured Guaranty Ltd.	$	196		$	187		$	142		$	247		$	(576	)	$	196

Comprehensive income (loss)	$	398		$	315		$	261		$	460		$	(1,036	)	$	398

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2018

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	288		$	(7	)	$	281
Net investment income	—			4			—			200			(6		)	198
Net realized investment gains (losses)	—			—			—			(7		)	—			(7		)
Net change in fair value of credit derivatives	—			—			—			82			—			82
Other	6			—			—			65			(112		)	(41		)
Total revenues	6			4			—			628			(125		)	513
Expenses
Loss and LAE	—			—			—			30			(4		)	26
Amortization of deferred acquisition costs	—			—			—			11			(2		)	9
Interest expense	—			24			27			5			(8		)	48
Other operating expenses	20			3			1			200			(97		)	127
Total expenses	20			27			28			246			(111		)	210
Equity in net earnings of investees	—			—			—			1			—			1
Income (loss) before income taxes and equity in net earnings of subsidiaries	(14		)	(23		)	(28		)	383			(14		)	304
Total (provision) benefit for income taxes	—			5			6			(45		)	2			(32		)
Equity in net earnings of subsidiaries	286			225			111			13			(635		)	—
Net income (loss)	$	272		$	207		$	89		$	351		$	(647	)	$	272
Less: noncontrolling interest	—			—			—			13			(13		)	—
Net income (loss) attributable to Assured Guaranty Ltd.	$	272		$	207		$	89		$	338		$	(634	)	$	272

Comprehensive income (loss)	$	84		$	74		$	(7	)	$	163		$	(230	)	$	84

Condensed Consolidating Statement of Cash Flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2019

(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	$	226		$	110		$	56		$	(121	)	$	(469	)	$	(198	)
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(3		)	—			(503		)	3			(503		)
Sales	—			—			—			914			—			914
Maturities and paydowns	—			—			2			504			—			506
Short-term investments with maturities of over three months:
Purchases	—			—			—			(209		)	—			(209		)
Sales	—			—			—			2			—			2
Maturities and paydowns	—			12			—			162			—			174
Net sales (purchases) of short-term investments with maturities of less than three months	18			(72		)	5			(340		)	—			(389		)
Net proceeds from paydowns on FG VIEs’ assets	—			—			—			50			—			50
Net proceeds from sales of FG VIEs’ assets	—			—			—			51			—			51
Proceeds from stock redemption and return of capital from subsidiaries	—			100			—			10			(110		)	—
Other	—			—			—			35			—			35
Net cash flows provided by (used in) investing activities	18			37			7			676			(107		)	631
Cash flows from financing activities
Return of capital	—			—			—			(10		)	10			—
Dividends paid	(39		)	(147		)	(62		)	(260		)	469			(39		)
Repurchases of common stock	(190		)	—			—			(100		)	100			(190		)
Repurchases of common stock to pay withholding taxes	(16		)	—			—			—			—			(16		)
Net paydowns of FG VIEs’ liabilities	—			—			—			(95		)	—			(95		)
Paydown of long-term debt	—			—			—			(1		)	(3		)	(4		)
Proceeds from options exercises	1			—			—			—			—			1
Net cash flows provided by (used in) financing activities	(244		)	(147		)	(62		)	(466		)	576			(343		)
Effect of exchange rate changes	—			—			—			—			—			—
Increase (decrease) in cash and restricted cash	—			—			1			89			—			90
Cash and restricted cash at beginning of period	—			1			—			103			—			104
Cash and restricted cash at end of period	$	—		$	1		$	1		$	192		$	—		$	194

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2018

(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	$	296		$	88		$	43		$	524		$	(507	)	$	444
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(27		)	(12		)	(863		)	23			(879		)
Sales	—			11			2			579			—			592
Maturities and paydowns	—			10			—			523			—			533
Short-term investments with maturities of over three months:
Purchases	—			—			—			(121		)	—			(121		)
Sales	—			—			—			1			—			1
Maturities and paydowns	—			—			—			104			—			104
Net sales (purchases) of short-term investments with maturities of less than three months	3			(78		)	16			(229		)	—			(288		)
Net proceeds from paydowns on FG VIEs’ assets	—			—			—			60			—			60
Proceeds from stock redemption and return of capital from subsidiaries	—			200			—			—			(200		)	—
Other	—			(15		)	—			(1		)	—			(16		)
Net cash flows provided by (used in) investing activities	3			101			6			53			(177		)	(14		)
Cash flows from financing activities
Dividends paid	(37		)	(222		)	(50		)	(235		)	507			(37		)
Repurchases of common stock	(250		)	—			—			(200		)	200			(250		)
Repurchases of common stock to pay withholding taxes	(13		)	—			—			—			—			(13		)
Net paydowns of FG VIEs’ liabilities	—			—			—			(61		)	—			(61		)
Paydown of long-term debt	—			—			—			(1		)	(23		)	(24		)
Proceeds from options exercises	1			—			—			—			—			1
Net cash flows provided by (used in) financing activities	(299		)	(222		)	(50		)	(497		)	684			(384		)
Effect of exchange rate changes	—			—			—			(1		)	—			(1		)
Increase (decrease) in cash and restricted cash	—			(33		)	(1		)	79			—			45
Cash and restricted cash at beginning of period	—			33			2			109			—			144
Cash and restricted cash at end of period	$	—		$	—		$	1		$	188		$	—		$	189