Assured Guaranty Ltd. : New Bond Insurer Municipal Assurance Corp. Opens for Business

Assured Guaranty Ltd. (Assured Guaranty) (NYSE:AGO) announced today the launch of Municipal Assurance Corp. (MAC), a new municipal bond insurance company that will insure only select categories of U.S. municipal bonds.

The new company opens for business with $1.5 billion of claims-paying resources, financial strength ratings of AA+ (stable outlook) from Kroll Bond Rating Agency and AA- (stable outlook) from Standard & Poor's Rating Services, and insurance licenses in 37 states and the District of Columbia. MAC has been capitalized to approximately $800 million through cash and securities contributed by Assured Guaranty Municipal Corp. (AGM) and Assured Guaranty Corp. (AGC), which own MAC jointly via a holding company. Additionally, MAC has an initial statutory unearned premium reserve of $709 million from a $103 billion net statutory par ($111 billion net GAAP par), 100% investment grade book of insured U.S. municipal bonds reinsured by it from AGM and AGC.

Dominic Frederico, President and Chief Executive Officer of Assured Guaranty, said: "We are pleased to launch MAC to provide an additional choice to municipal bond investors and issuers, especially those who prefer an insurer focused exclusively on the most familiar types of U.S. municipal bonds. MAC will complement the municipal bond insurance businesses of AGM and AGC, which continue their U.S. public finance activity and bring their own particular strengths to the market. We believe MAC will help build greater overall demand for municipal bond insurance and that, with our three platforms, Assured Guaranty will expand its leadership in the industry.

"Unlike a typical start-up, MAC begins life with the same proven management, underwriting team and surveillance staff as AGM and AGC, as well as Assured Guaranty's well-developed operational infrastructure and enterprise risk management systems. This, combined with the income from its $1.5 billion investment portfolio and the premium revenue from its reinsurance portfolio, will enhance its financial strength compared with start-ups that drain capital in their early years," added Mr. Frederico.

As of today, MAC is licensed in 38 jurisdictions. MAC is pursuing licenses in the remaining states through the expedited approval process offered by the National Association of Insurance Commissioners' Review of Electronic Application Coordination and Processing (REACAP) Program. (A list of states where MAC is licensed and those states where it is authorized to offer insurance appears at the bottom of this press release.)

Competitive Strengths of the Three Insurance Platforms

MAC's underwriting guidelines and credit policies limit its business to municipal bonds only in S&P municipal risk categories 1 and 2, which are largely general obligations; sales tax, public higher education, lease and general fund obligations; and water, sewer, public electric power and transportation revenue bonds. These are generally the most common and well-understood sectors of the municipal bond market.

The launch of MAC has no effect on the ratings or rating outlooks of AGM and AGC from S&P and is not expected to have any effect on such ratings or rating outlooks from Moody's. Both companies remain well capitalized.

Superior Capital Access and Transparency

Each of MAC, AGM and AGC benefit from Assured Guaranty's broad access to capital in both debt and equity capital markets. In this regard, Assured Guaranty's listing on the New York Stock Exchange (NYSE) reinforces the financial strength of the organization and supports MAC from day one. Additionally, Securities and Exchange Commission (SEC) and NYSE disclosure rules require that Assured Guaranty provide a higher level of transparency than do non-public companies.

Jurisdictions Where MAC Is Licensed

Assured Guaranty Ltd. is a publicly traded Bermuda-based holding company. Its operating subsidiaries provide credit enhancement products to the U.S. and international public finance, infrastructure and structured finance markets. More information on Assured Guaranty and its subsidiaries can be found at AssuredGuaranty.com and MACmunibonds.com.

Municipal Assurance Corp. License Status: MAC is not licensed to transact insurance business in all jurisdictions, including California, and the insurance products and services described in this communication may not be available to all potential customers or investors. This press release is for informational purposes only and does not constitute an offer to sell or a solicitation to buy any insurance product or service in any jurisdiction where MAC is not licensed and authorized to write insurance. Please see the press release for a list of the states where MAC is licensed and authorized to write insurance.

Cautionary Statement Regarding Forward-Looking Statements:

Any forward-looking statements made in this press release reflect Assured Guaranty's current views with respect to future events and financial performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties that may cause actual results to differ materially from those set forth in these statements. For example, Assured Guaranty may not be able to execute its strategy of increasing demand for municipal bond insurance and expanding its position in the industry; losses on MAC's insured and/or investment portfolio may be greater than expected; MAC may not be able to obtain the additional licenses it seeks; the rating agencies may take rating action on the financial strength ratings of any of MAC, AGM and/or AGC; and Assured Guaranty may not be able to raise additional capital when needed on terms acceptable to it or at all. Other risk factors are identified in Assured Guaranty's filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements are made as of July 22, 2013, and Assured Guaranty undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Assured Guaranty Ltd.
Robert Tucker, 212-339-0861
Managing Director, Investor Relations and Corporate Communications
rtucker@assuredguaranty.com
or
Ashweeta Durani, 212-408-6042
Vice President, Corporate Communications
adurani@assuredguaranty.com