logo
Plus   Neg
Share
Email

Assured Guaranty Swings To Q1 Net Loss; Announces RMBS Settlement Agreement

Assured Guaranty Ltd. (AGO) reported a net loss for the first quarter of $483.0 million or $2.65 per share, compared to net income of $139.3 million or $0.74 per share for the year-ago quarter.

The latest quarter net loss includes non-economic net fair value losses of $560.0 million, while the year-ago net income included non-economic net fair value losses of $119.2 million as well as the benefit of the Bank of America agreement that was executed last year.

Operating income, a non-GAAP measure, for first quarter was $71.2 million or $0.38 per share, compared to $247.4 million or $1.32 per share in the prior year quarter.

The latest quarter operating income includes commutation gains of $54.2 million, or $0.30 per share, from two re-assumptions of previously ceded books of business. It also includes an after-tax net loss of $136.5 million or $0.73 per share representing the company's expected ultimate loss on its Greek sovereign exposures.

Net earned premium for the quarter dropped to $193.7 million from $254.0 million in the year-ago quarter.

Analysts polled by Thomson Reuters expected the company to earn $0.36 per share on revenue of $192.65 million for the first quarter. Analysts' estimates typically exclude special items.

Additionally, Assured Guaranty said that it has reached a settlement with Deutsche Bank AG and certain of its affiliates, resolving claims related to residential mortgage-backed securities transactions issued, underwritten or sponsored by Deutsche Bank that were insured by Assured Guaranty under financial guaranty insurance policies and to certain RMBS exposures in re-securitization transactions on which Assured Guaranty provided credit protection through credit default swaps.

As part of the agreement with Deutsche Bank, Assured Guaranty said it received a cash payment of $165.6 million, a portion of which will partially reimburse Assured Guaranty for past losses on certain transactions that are covered by a loss-sharing agreement, which also requires Deutsche Bank to pay a portion of Assured Guaranty's future RMBS related losses.

by RTTNews Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Quick Facts

Editors Pick
In a move likely to further inflame global trade tensions, President Donald Trump has threatened to impose a 20 percent tariff on all cars imported to the U.S. from the European Union. Trump claimed he would impose the new tariffs unless the EU removes tariffs and trade barriers placed on the U.S. The Federal Reserve has determined that the largest U.S. banks are strongly capitalized and would be able to lend to banks as well as households during a severe global economic recession. This is the fourth straight year that all banks have met the Federal Reserve's standards. The first round of results of the supervisory stress tests were released by the central bank on Thursday. The "safety" driver behind the wheel of a self-driving Uber was streaming a television show on her smartphone up until about the time of a fatal crash in March, according to a report from the Tempe Police Department. Uber's self-driving Volvo SUV, which was traveling at under 44 miles per hour, had struck and killed a pedestrian in Arizona on March 18.
Follow RTT