Moody's rates Assured Guaranty notes Baa2

Moody's Investors Service said it assigned a Baa2 rating to the new senior notes due 2024 to be issued by Assured Guaranty US Holdings Inc. and guaranteed by Assured Guaranty Ltd. The outlook is stable.

Proceeds will be used by the issuer for general corporate purposes, including corporate and working capital purposes, to purchase common shares of Assured Guaranty Ltd., to repay debt, to finance acquisitions and for capital expenditures.

The agency said the company’s ratings reflect its leadership position in the financial guaranty insurance sector, its strong overall capital profile and ongoing de-risking through insured portfolio amortization.

In Moody’s view, these strengths are tempered by the fact that Assured operates in an industry that has not recovered from the financial crisis and, like its peers, the company faces significant headwinds from declining fundamentals in the sector, including a dramatic reduction in insurance usage, moderate prospective profitability and still-meaningful legacy risk.

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