KBRA Report Highlights Growth in Demand for Municipal Bond insurance: Report Notes Bond industry Insurance Penetration Spiked...
04 August 2020 - 8:00PM
Business Wire
Assured Guaranty Ltd. (NYSE:AGO) announced today that Kroll Bond
Rating Agency (KBRA) issued a report published July 30, 2020
entitled “Coronavirus (COVID-19): Pandemic Fears Spur Market Demand
for Bond Insurance”.
- The report notes that “bond industry insurance penetration
spiked sharply higher (nearly 7%) in the first half of 2020” due to
widening credit spreads, increased investor concerns and heightened
uncertainty for issuers.
- Additionally, KBRA noted that “If the 1H level persists for the
remainder of the year, it would be the highest level since
2009.”
- Kroll further added, “A main reason an issuer or investor may
decide to ‘wrap’ a bond includes the benefit derived from lower
interest cost coupled with improved liquidity and credit
protection. These benefits are derived from the strength of the
insurer’s balance sheet behind each policy.”
- The KBRA report follows S&P Global Rating’s (S&P’s)
report published April 3, 2020 where it, too, pointed out that "in
the current macroeconomic environment, demand for the financial
guarantee product appears to be growing in the U.S. public finance
market."
- During this challenging period for the U.S. economy, Assured
Guaranty remains committed to its strict underwriting standards
while continuing to help lower the cost of funding for
municipalities and issuers, and providing enhanced security to
investors.
In response to the report, Dominic Frederico, President and CEO
of Assured Guaranty, said: “We are seeing significant increases in
new business volume for Assured Guaranty in both primary and
secondary public finance markets and increased municipal bond
insurance penetration for the Company since the start of the
COVID-19 pandemic. We will continue to work with issuers,
municipalities and our investors on meeting their financing and
investing needs through our insurance guarantee and strong capital
adequacy.”
A copy of the KBRA report can be found here.
Any forward-looking statements made in this press release
reflect Assured Guaranty’s current views with respect to future
events 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 this press release. These
risks and uncertainties include, but are not limited to,
difficulties executing Assured Guaranty’s business strategy; those
risks and uncertainties resulting from changes in rating agency
models or opinions; changes in the world’s credit markets, segments
thereof, interest rates, credit spreads or general economic
conditions; the development, course and duration of the COVID-19
pandemic and the governmental and private actions taken in
response, and the global consequences of the pandemic and such
actions; adverse credit developments in Puerto Rico or other
portions of Assured Guaranty’s insured portfolio and the impact of
those developments on rating agency models and opinions; adverse
developments in Assured Guaranty’s asset management business; other
risks and uncertainties that have not been identified at this time,
management’s response to these factors, and other risk factors
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, which are made as of
August 4, 2020. 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. is a publicly traded (NYSE: AGO)
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 Ltd. and its subsidiaries can be
found at AssuredGuaranty.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200804005849/en/
Investor Relations: Robert Tucker, 212-339-0861 Senior Managing
Director, Investor Relations and Corporate Communications
rtucker@assuredguaranty.com
Media: Ashweeta Durani, 212-408-6042 Vice President, Corporate
Communications adurani@assuredguaranty.com
Assured Guaranty Municipal (NYSE:AGO)
Historical Stock Chart
Von Mär 2024 bis Apr 2024
Assured Guaranty Municipal (NYSE:AGO)
Historical Stock Chart
Von Apr 2023 bis Apr 2024