Assured Guaranty Loses $260 Million in Q4

Assured Guaranty, one of the few guarantors to steer clear of the current ratings mess, said Tuesday that it lost $260.1 million, $3.77/share, during the fourth quarter as the guarantor absorbed roughly $308 million in credit default swap write-offs on an after-tax basis. The fourth quarter loss compared to $42.4 million, or $.58 per share, in earnings one year earlier. Assured did not underwrite meaningful volumes of ABS CDOs in recent years, which is providing to be the firm’s saving grace during otherwise stressful conditions for many of its competitors. The firm also exited the mortgage guaranty business in early 2005, and has not written new contracts since the first quarter of that year. It’s mortgage book of business has been run-off since that time. While CDO and related mortgage-backed exposure didn’t hurt Assured, the company did feel some pain from direct HELOC exposure during the fourth quarter. The company provisioned $20.1 million in the fourth quarter related to U.S. HELOC exposure, it said, after $1.8 billion of HELOC securities it insured were downgraded by various rating agencies. For more information, visit http://www.assuredguaranty.com.