Subsidiary Information

12 Months Ended

Dec. 31, 2019

Condensed Financial Information Disclosure [Abstract]

The following tables present the condensed consolidating financial information for AGUS and AGMH, 100%-owned subsidiaries of AGL, which have issued publicly traded debt securities that are fully and unconditionally guaranteed by AGL. The information for AGL, AGUS and AGMH presents their subsidiaries on the equity method of accounting.

CONDENSED CONSOLIDATING BALANCE SHEET

AS OF DECEMBER 31, 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	$	135	$	364	$	15	$	10,408	$	(513	)	$	10,409
Investment in subsidiaries	6,450		6,224		4,258		383		(17,315		)	—
Premiums receivable, net of commissions payable	—		—		—		1,502		(216		)	1,286
Deferred acquisition costs	—		—		—		145		(34		)	111
Intercompany loan receivable	—		—		—		290		(290		)	—
FG VIEs’ assets, at fair value	—		—		—		442		—			442
Assets of consolidated investment vehicles	—		—		—		595		(23		)	572
Dividends receivable from affiliate	40		10		—		—		(50		)	—
Goodwill and other intangible assets	—		—		—		216		—			216
Other	31		32		27		2,769		(1,569		)	1,290
Total assets	$	6,656	$	6,630	$	4,300	$	16,750	$	(20,010	)	$	14,326
Liabilities and shareholders' equity
Unearned premium reserves	$	—	$	—	$	—	$	4,584	$	(848	)	$	3,736
Loss and LAE reserve	—		—		—		1,316		(266		)	1,050
Long-term debt	—		844		476		4		(89		)	1,235
Intercompany loans payable	—		290		—		300		(590		)	—
Credit derivative liabilities	—		—		—		225		(34		)	191
FG VIEs’ liabilities, at fair value	—		—		—		469		—			469
Liabilities of consolidated investment vehicles	—		—		—		505		(23		)	482
Dividends payable to affiliate	—		40		10		—		(50		)	—
Other	17		69		66		1,010		(651		)	511
Total liabilities	17		1,243		552		8,413		(2,551		)	7,674
Redeemable noncontrolling interests in consolidated investment vehicles	—		—		—		—		7			7
Total shareholders' equity attributable to AGL	6,639		5,387		3,748		7,954		(17,089		)	6,639
Nonredeemable noncontrolling interests	—		—		—		383		(377		)	6
Total shareholders' equity	6,639		5,387		3,748		8,337		(17,466		)	6,645
Total liabilities, redeemable noncontrolling interests and shareholders' equity	$	6,656	$	6,630	$	4,300	$	16,750	$	(20,010	)	$	14,326

____________________


(1)	The fair value of the AGMH debt purchased by AGUS, and recorded in the AGUS investment portfolio, was $136 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 loans 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
Redeemable noncontrolling interests in consolidated investment vehicles	—		—		—		—		—			—
Total shareholders' equity attributable to AGL	6,555		5,229		3,503		7,590		(16,322		)	6,555
Noncontrolling interests	—		—		—		226		(226		)	—
Total shareholders' equity	6,555		5,229		3,503		7,816		(16,548		)	6,555
Total liabilities, redeemable noncontrolling interests 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

FOR THE YEAR ENDED DECEMBER 31, 2019

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	486		$	(10	)	$	476
Net investment income	—			11			1			388			(22		)	378
Asset management fees	—			—			—			22			—			22
Net realized investment gains (losses)	—			—			—			22			—			22
Net change in fair value of credit derivatives	—			—			—			(6		)	—			(6		)
Other	—			—			—			78			(7		)	71
Total revenues	—			11			1			990			(39		)	963
Expenses
Loss and LAE	—			—			—			98			(5		)	93
Interest expense	—			51			54			11			(27		)	89
Amortization of deferred acquisition costs	—			—			—			22			(4		)	18
Other operating expenses	31			10			—			266			(4		)	303
Total expenses	31			61			54			397			(40		)	503
Equity in net earnings of investees	—			—			—			2			2			4
Income (loss) before income taxes and equity in net earnings of subsidiaries	(31		)	(50		)	(53		)	595			3			464
Total (provision) benefit for income taxes	—			10			11			(84		)	—			(63		)
Equity in net earnings of subsidiaries	433			422			327			18			(1,200		)	—
Net income (loss)	402			382			285			529			(1,197		)	401
Less: noncontrolling interests	—			—			—			18			(19		)	(1		)
Net income (loss) attributable to AGL	$	402		$	382		$	285		$	511		$	(1,178	)	$	402

Comprehensive income (loss)	$	651		$	553		$	440		$	781		$	(1,775	)	$	650

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE YEAR ENDED DECEMBER 31, 2018

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	563		$	(15	)	$	548
Net investment income	1			9			1			398			(14		)	395
Net realized investment gains (losses)	—			—			—			(32		)	—			(32		)
Net change in fair value of credit derivatives	—			—			—			112			—			112
Other	12			—			—			192			(226		)	(22		)
Total revenues	13			9			1			1,233			(255		)	1,001
Expenses
Loss and LAE	—			—			—			70			(6		)	64
Interest expense	—			49			54			10			(19		)	94
Amortization of deferred acquisition costs	—			—			—			21			(5		)	16
Other operating expenses	41			10			—			394			(197		)	248
Total expenses	41			59			54			495			(227		)	422
Equity in net earnings of investees	—			—			—			1			—			1
Income (loss) before income taxes and equity in net earnings of subsidiaries	(28		)	(50		)	(53		)	739			(28		)	580
Total (provision) benefit for income taxes	—			52			11			(123		)	1			(59		)
Equity in net earnings of subsidiaries	549			412			277			24			(1,262		)	—
Net income (loss)	521			414			235			640			(1,289		)	521
Less: noncontrolling interests	—			—			—			24			(24		)	—
Net income (loss) attributable to AGL	$	521		$	414		$	235		$	616		$	(1,265	)	$	521

Comprehensive income (loss)	$	274		$	218		$	107		$	395		$	(720	)	$	274

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

AND COMPREHENSIVE INCOME

FOR THE YEAR ENDED DECEMBER 31, 2017

(in millions)



	Assured Guaranty Ltd. (Parent)			AGUS (Issuer)			AGMH (Issuer)			Other Entities			Consolidating Adjustments			Assured Guaranty Ltd. (Consolidated)
Revenues
Net earned premiums	$	—		$	—		$	—		$	728		$	(38	)	$	690
Net investment income	—			2			—			426			(11		)	417
Net realized investment gains (losses)	—			—			—			45			(5		)	40
Net change in fair value of credit derivatives	—			—			—			111			—			111
Bargain purchase gain and settlement of pre-existing relationships	—			—			—			58			—			58
Other	10			—			—			609			(196		)	423
Total revenues	10			2			—			1,977			(250		)	1,739
Expenses
Loss and LAE	—			—			—			327			61			388
Interest expense	—			47			54			11			(15		)	97
Amortization of deferred acquisition costs	—			—			—			26			(7		)	19
Other operating expenses	38			12			1			394			(201		)	244
Total expenses	38			59			55			758			(162		)	748
Equity in net earnings of investees	—			—			—			—			—			—
Income (loss) before income taxes and equity in net earnings of subsidiaries	(28		)	(57		)	(55		)	1,219			(88		)	991
Total (provision) benefit for income taxes	—			17			54			(359		)	27			(261		)
Equity in net earnings of subsidiaries	758			636			395			32			(1,821		)	—
Net income (loss)	730			596			394			892			(1,882		)	730
Less: noncontrolling interests	—			—			—			32			(32		)	—
Net income (loss) attributable to AGL	$	730		$	596		$	394		$	860		$	(1,850	)	$	730

Comprehensive income (loss)	$	897		$	754		$	482		$	1,084		$	(2,320	)	$	897

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED DECEMBER 31, 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	$	679		$	190		$	172		$	(287	)	$	(1,263	)	$	(509	)
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(3		)	—			(873		)	3			(873		)
Sales	—			—			—			1,805			—			1,805
Maturities and paydowns	—			11			8			762			—			781
Short-term investments with maturities of over three months:
Purchases	—			—			—			(229		)	—			(229		)
Sales	—			—			—			2			—			2
Maturities and paydowns	—			12			—			304			—			316
Net sales (purchases) of short-term investments with maturities of less than three months	(90		)	(44		)	4			(493		)	—			(623		)
Net proceeds from paydowns on FG VIEs’ assets	—			—			—			139			—			139
Net proceeds from sales of FG VIEs’ assets	—			—			—			51			—			51
Repayment of intercompany loans	—			—			—			10			(10		)	—
Issuance of intercompany loans	—			—			—			(250		)	250			—
Investment in subsidiaries	—			65			5			(175		)	105			—
Return of capital from subsidiaries	—			100			—			10			(110		)	—
BlueMountain Acquisition, net of cash acquired	—			(157		)	—			12			—			(145		)
Other	—			—			—			(55		)	—			(55		)
Net cash flows provided by (used in) investing activities	(90		)	(16		)	17			1,020			238			1,169
Cash flows from financing activities
Return of capital	—			—			—			(10		)	10			—
Capital contribution	—			—			—			105			(105		)	—
Dividends paid	(74		)	(414		)	(186		)	(649		)	1,249			(74		)
Repurchases of common stock	(500		)	—			—			(100		)	100			(500		)
Net paydowns of FG VIEs’ liabilities	—			—			—			(181		)	—			(181		)
Paydown of long-term debt	—			—			—			(1		)	(3		)	(4		)
Repayment of intercompany loans	—			(10		)	—			—			10			—
Issuance of intercompany loans	—			250			—			—			(250		)	—
Proceeds from issuance of CLO obligations	—			—			—			482			—			482
Repayment of warehouse loans and equity	—			—			—			(306		)	—			(306		)
Contributions from noncontrolling interests to investment vehicles	—			—			—			—			18			18
Distributions to redeemable noncontrolling interests from investment vehicles	—			—			—			—			(4		)	(4		)
Other	(15		)	—			—			—			—			(15		)
Net cash flows provided by (used in) financing activities	(589		)	(174		)	(186		)	(660		)	1,025			(584		)
Effect of exchange rate changes	—			—			—			3			—			3
Increase (decrease) in cash and restricted cash	—			—			3			76			—			79
Cash and restricted cash at beginning of period	—			1			—			103			—			104
Cash and restricted cash at end of period	$	—		$	1		$	3		$	179		$	—		$	183

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED DECEMBER 31, 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	$	587		$	308		$	183		$	517		$	(1,133	)	$	462
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(104		)	(12		)	(1,865		)	100			(1,881		)
Sales	—			104			8			1,068			—			1,180
Maturities and paydowns	—			28			—			934			—			962
Short-term investments with maturities of over three months:
Purchases	—			(34		)	—			(209		)	—			(243		)
Sales	—			22			—			1			—			23
Maturities and paydowns	—			—			—			207			—			207
Net sales (purchases) of short-term investments with maturities of less than three months	(9		)	(50		)	7			(32		)	—			(84		)
Net proceeds from paydowns on FG VIEs’ assets	—			—			—			116			—			116
Investment in subsidiaries	—			(9		)	(1		)	(1		)	11			—
Repayment of intercompany loans	—			—			—			10			(10		)	—
Return of capital from subsidiaries	—			200			—			—			(200		)	—
Other	—			(15		)	—			32			—			17
Net cash flows provided by (used in) investing activities	(9		)	142			2			261			(99		)	297
Cash flows from financing activities
Capital contribution	—			—			—			11			(11		)	—
Dividends paid	(71		)	(472		)	(187		)	(474		)	1,133			(71		)
Repurchases of common stock	(500		)	—			—			(200		)	200			(500		)
Net paydowns of FG VIEs’ liabilities	—			—			—			(116		)	—			(116		)
Paydown of long-term debt	—			—			—			(1		)	(100		)	(101		)
Repayment of intercompany loans	—			(10		)	—			—			10			—
Other	(7		)	—			—			—			—			(7		)
Net cash flows provided by (used in) financing activities	(578		)	(482		)	(187		)	(780		)	1,232			(795		)
Effect of exchange rate changes	—			—			—			(4		)	—			(4		)
Increase (decrease) in cash and restricted cash	—			(32		)	(2		)	(6		)	—			(40		)
Cash and restricted cash at beginning of period	—			33			2			109			—			144
Cash and restricted cash at end of period	$	—		$	1		$	—		$	103		$	—		$	104

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED DECEMBER 31, 2017

(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	$	579		$	442		$	158		$	477		$	(1,223	)	$	433
Cash flows from investing activities
Fixed-maturity securities:
Purchases	—			(158		)	(17		)	(2,404		)	27			(2,552		)
Sales	—			112			21			1,568			—			1,701
Maturities and paydowns	—			13			—			808			—			821
Short-term investments with maturities of over three months:
Purchases	—			(26		)	(5		)	(224		)	—			(255		)
Sales	—			1			5			96			—			102
Maturities and paydowns	—			30			—			161			—			191
Net sales (purchases) of short-term investments with maturities of less than three months	—			126			(8		)	(82		)	—			36
Net proceeds from paydowns on FG VIEs’ assets	—			—			—			147			—			147
Investment in subsidiaries	—			(28		)	—			(139		)	167			—
Repayment of intercompany loans	—			—			—			10			(10		)	—
Proceeds from sale of subsidiaries	—			—			—			139			(139		)	—
Return of capital from subsidiaries	—			—			101			70			(171		)	—
Acquisition of MBIA UK, net of cash acquired	—			—			—			95			—			95
Other	—			—			—			59			—			59
Net cash flows provided by (used in) investing activities	—			70			97			304			(126		)	345
Cash flows from financing activities
Return of capital	—			—			—			(70		)	70			—
Capital contribution	—			—			25			3			(28		)	—
Dividends paid	(70		)	(470		)	(278		)	(475		)	1,223			(70		)
Repurchases of common stock	(501		)	—			—			(101		)	101			(501		)
Net paydowns of FG VIEs’ liabilities	—			—			—			(157		)	—			(157		)
Paydown of long-term debt	—			—			—			(3		)	(27		)	(30		)
Repayment of intercompany loans	—			(10		)	—			—			10			—
Other	(8		)	—			—			—			—			(8		)
Net cash flows provided by (used in) financing activities	(579		)	(480		)	(253		)	(803		)	1,349			(766		)
Effect of exchange rate changes	—			—			—			5			—			5
Increase (decrease) in cash and restricted cash	—			32			2			(17		)	—			17
Cash and restricted cash at beginning of period	—			1			—			126			—			127
Cash and restricted cash at end of period	$	—		$	33		$	2		$	109		$	—		$	144