FINANCIAL GUARANTEES IN FORCE

Financial guarantees outstanding includes the exposures of policies that insure variable interest entities (“VIEs”) consolidated in accordance with ASC Topic 810, Consolidation. Financial guarantees outstanding excludes the exposures of policies that insure bonds which have been called, pre-refunded or refunded. The gross par amount of financial guarantees outstanding was $159,688,000 and $197,691,000 at December 31, 2014 and 2013, respectively. The par amount of financial guarantees outstanding, net of reinsurance, was $144,734,000 and $179,092,000 at December 31, 2014 and 2013, respectively.

As of December 31, 2014 and 2013, the guarantee portfolio was diversified by type of guaranteed bond as shown in the following table:



	Net Par Amount Outstanding
	December 31,
	2014		2013
Public Finance:
Lease and tax-backed revenue	$	33,411,000	$	41,858,000
General obligation	22,699,000		29,115,000
Utility revenue	11,687,000		14,933,000
Transportation revenue	7,738,000		9,653,000
Housing revenue	7,108,000		7,439,000
Higher education	6,389,000		7,810,000
Health care revenue	3,106,000		3,903,000
Other	1,310,000		1,351,000
Total Public Finance	93,448,000		116,062,000
Structured Finance:
Mortgage-backed and home equity	13,686,000		16,026,000
Investor-owned utilities	5,411,000		5,881,000
Student loan	3,390,000		4,357,000
Asset-backed ⁽¹⁾	1,335,000		2,361,000
CDOs	637,000		897,000
Other	1,875,000		1,890,000
Total Structured Finance	26,334,000		31,412,000
International Finance:
Investor-owned and public utilities	8,455,000		9,595,000
Sovereign/sub-sovereign	6,758,000		7,394,000
Asset-backed ⁽¹⁾	4,442,000		6,884,000
Transportation	3,425,000		5,021,000
Mortgage-backed and home equity	410,000		484,000
CDOs	233,000		822,000
Other	1,229,000		1,418,000
Total International Finance	24,952,000		31,618,000
Total	$	144,734,000	$	179,092,000


(1)	At December 31, 2014 and 2013, all asset-backed net par amounts outstanding relate to commercial asset-based transactions.

As of December 31, 2014 and 2013, the International Finance guaranteed portfolio is shown in the following table by location of risk:



	Net Par Amount Outstanding
	December 31,
	2014		2013
United Kingdom	$	17,998,000	$	21,282,000
Australia	2,168,000		3,331,000
Italy	1,415,000		2,412,000
Austria	841,000		967,000
New Zealand	459,000		526,000
Internationally diversified ⁽¹⁾	1,225,000		1,918,000
Other international	846,000		1,182,000
Total International Finance	$	24,952,000	$	31,618,000


(1)	Internationally diversified obligations represent pools of geographically diversified exposures which may include components of U.S. exposure.

Gross financial guarantees in force (principal and interest) was $253,383,000 and $312,710,000 at December 31, 2014 and 2013, respectively. Net financial guarantees in force (after giving effect to reinsurance) was $228,890,000 and $282,210,000 as of December 31, 2014 and 2013, respectively.

In the United States, California and New York were the states with the highest aggregate net par amounts in force, accounting for 14.3% and 6.4% of the total at December 31, 2014, respectively. No other state accounted for more than 5.0%. The highest single insured risk represented 1.4% of the aggregate net par amount guaranteed.