Exhibit 99.2
Quarterly
Operating
Supplement
March 31, 2005
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
QUARTERLY OPERATING SUPPLEMENT
First Quarter 2005
Table of Contents
Financial Security Assurance Holdings Ltd. (the Company), through its wholly owned subsidiary, Financial Security Assurance Inc. (FSA), provides Aaa/AAA/AAA financial guaranty insurance for obligations in the municipal, infrastructure, asset-backed and structured finance markets worldwide. FSA’s financial strength is rated Triple-A by Fitch Ratings, Moody’s Investors Service, Inc., Standard & Poor’s Ratings Services (S&P) and Rating and Investment Information, Inc. (R&I). The Company is a member of the Dexia group, a leading European banking group with four core business lines: financial services to the local public sector, retail financial services, investment management services, and treasury and financial markets.
Financial Security Assurance Holdings Ltd.
Highlights
Financial Key Lines
| | 1st Qtr.
2005 | | Year-to-Date
2005 | | Full Year
2004 | |
| | | | | | | |
Net income (millions) | | $ | 80.1 | | $ | 80.1 | | $ | 363.8 | |
Shareholders’ equity (millions) | | 2,586.7 | | 2,586.7 | | 2,550.0 | |
Return on average equity | | 12.4 | % | 12.4 | % | 15.6 | % |
GAAP: (1) | | | | | | | |
Loss ratio(2) | | 4.0 | | 4.0 | | 5.0 | |
Expense ratio(2) | | 32.9 | | 32.9 | | 30.2 | |
Combined ratio(2) | | 36.9 | | 36.9 | | 35.2 | |
Effective tax rates: | | | | | | | |
Net investment income | | 12.3 | | 12.3 | | 10.3 | |
Underwriting and other income | | 35.9 | | 35.9 | | 29.0 | |
Total income | | 25.0 | | 25.0 | | 21.8 | |
| | | | | | | | | | |
Reconciliation of Net Income to Operating Earnings(3)
(dollars in millions)
| | 1st Qtr.
2005 | | Year-to-Date
2005 | | Full Year
2004 | |
| | | | | | | |
Net income | | $ | 80.1 | | $ | 80.1 | | $ | 363.8 | |
Less fair-value adjustments for insured CDS, net of taxes(4) | | (1.6 | ) | (1.6 | ) | 37.7 | |
Operating earnings | | $ | 81.7 | | $ | 81.7 | | $ | 326.1 | |
Reconciliation of Book Value to Adjusted Book Value(3)
(dollars in millions)
| | March 31,
2005 | | December 31,
2004 | |
| | | | | |
Shareholders’ equity (book value)(5) | | $ | 2,586.7 | | $ | 2,550.0 | |
After-tax adjustments: | | | | | |
Plus net deferred premium revenue | | 878.1 | | 868.6 | |
Plus present value of future net installment premiums and present value of future financial products net interest margin(6) | | 512.9 | | 497.3 | |
Less net deferred acquisition costs | | 207.4 | | 200.3 | |
Less fair-value adjustments for insured CDS | | 29.9 | | 31.4 | |
Adjusted book value | | $ | 3,740.4 | | $ | 3,684.2 | |
(1) Accounting principles generally accepted in the United States of America (GAAP).
(2) Relates solely to FSA.
(3) Operating earnings and adjusted book value are not promulgated in accordance with GAAP and are not substitutes for net income or book value. See “Review of Operations” for additional discussions.
(4) This item pertains to SFAS No. 133 fair-value adjustments for FSA-insured credit default swaps (CDS) that have investment-grade underlying credit quality. They are excluded from operating earnings because management believes it is probable that the financial impact of the fair-value adjustments for the insured CDS will disappear over the finite terms of the related exposures.
(5) Includes the effect of after-tax unrealized gains in the investment portfolio, which was $152.5 million at March 31, 2005 and $177.8 million at December 31, 2004.
(6) The discount rate varies according to the year of origination. For each year’s originations, the Company calculates the discount rate as the average pre-tax yield on its investment portfolio for the previous three years. The rate is 5.30% for 2005 and 5.62% for 2004.
FSA HOLDINGS FIRST QUARTER 2005 RESULTS
NET INCOME
$80 Million in Q1 05 (-5% vs. Q1 04)
ORIGINATIONS (PRESENT VALUE)
$193 Million in Q1 05 (+3% vs. Q1 04)
New York, New York, May 12, 2005 — Financial Security Assurance Holdings Ltd. (the Company), a member of the Dexia group and the holding company for bond insurer Financial Security Assurance Inc. (FSA), announced first quarter 2005 net income of $80.1 million, 4.6% lower than in last year’s comparable period due to prior-period gains from marking insured credit default swaps (CDS) to fair value.
NET INCOME AND RECONCILIATION TO NON-GAAP OPERATING EARNINGS
(Dollars in millions)
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
| | | | | | | |
Net Income | | $ | 80.1 | | $ | 84.0 | |
Less fair-value adjustments for insured credit default swaps, net of taxes (1) | | (1.6 | ) | 10.2 | |
Operating Earnings (1) | | $ | 81.7 | | $ | 73.8 | |
(1) For definitions, see below, “Analysis of Financial Results – Operating Earnings.” Also see “Non-GAAP Measures,” below, for a discussion of measures not promulgated in accordance with accounting principles generally accepted in the United States of America (GAAP).
The Company increased first-quarter operating earnings 10.6% over the result in the same period of 2004. See “Analysis of Financial Results,” below, for further discussion of earnings results.
Shareholders’ equity (book value) was $2.6 billion and non-GAAP adjusted book value (ABV) was $3.7 billion at March 31, 2005. Over the past 12 months, after taking dividends into account, ABV grew 15.5% excluding investment portfolio realized and unrealized capital gains and losses and 14.5% including such gains and losses. The Company’s management considers ABV to be a reasonable measure of the Company’s intrinsic value, exclusive of franchise value, and discloses ABV because it provides information important to management that would not be available to investors through GAAP disclosure alone. See “Non-GAAP Measures,” below, for a more detailed discussion of ABV and a reconciliation to the GAAP measure shareholders’ equity.
Present value (PV) originations, a non-GAAP measure, reached $192.7 million in the first quarter of 2005, 2.9% higher than in that quarter of 2004.
Robert P. Cochran, chairman and chief executive officer of the Company and FSA, said: “FSA got off to a good start in the first quarter of 2005. Despite the continued tight spread and highly competitive business environment, we surpassed last year’s origination results for the same period, continued mid-teens growth in adjusted book value per share and achieved respectable growth in operating earnings.
“While the biggest component of new production continued to be the U.S. municipal business, the U.S. asset-backed and European businesses also produced solid results. In aggregate, the business was well diversified and priced to produce solid future returns on equity. Looking ahead, we believe that the anticipated reduction in U.S. municipal new issue volume and the competitive pricing environment will be balanced by widening spreads in the asset-backed sector and expanding global opportunities.”
BUSINESS PRODUCTION
TOTAL ORIGINATIONS
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross par insured (dollars in billions) | | $ | 21.0 | | $ | 19.2 | |
PV originations (dollars in millions) (1) | | 192.7 | | 187.2 | |
| | | | | | | |
(1) Estimated by the Company as the sum of (a) the present value of premiums originated (PV premiums originated), defined as estimated future installment premiums discounted to their present value, as well as upfront premiums, but only for business originated during the period; plus (b) the present value of net interest margin originated (PV NIM originated) in the financial products segment, defined as the estimated interest to be received on the investments and the estimated interest to be paid on liabilities issued in the form of guaranteed investment contracts (GICs), discounted to present value. The discount rate was 5.30% in 2005 and 5.62% in 2004 for all originations. PV premiums originated, PV NIM originated and PV originations are non-GAAP measures. Management believes that by disclosing the components of PV originations in addition to premiums written, the Company provides investors with a more comprehensive description of its new business activity in a given period. For further discussion, see “Non-GAAP Measures” below. For a reconciliation of PV premiums originated to gross premiums written, see below, “Analysis of Financial Results – Premiums.”
Unless otherwise noted, percentage changes mentioned in this release compare the period named with the comparable period of the previous year.
U.S. MUNICIPAL ORIGINATIONS
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross par insured (dollars in billions) | | $ | 12.3 | | $ | 11.0 | |
PV premiums originated (dollars in millions) | | 76.8 | | 89.4 | |
| | | | | | | |
The first quarter of 2005 saw the heaviest municipal market volume on record for a first quarter, with an estimated $98.0 billion of new issues coming to market, 13.2% more than in the first quarter of 2004, largely because of a significant increase in refundings. Insurance penetration was approximately 62%, compared with 46% in last year’s comparable period. In this environment, FSA insured approximately 24% of the par amount of insured new issues with sale dates in the first quarter.
Including both primary and secondary U.S. municipal obligations with closing dates in the first quarter, the par amount insured by FSA increased 12.1%, and non-GAAP PV premiums originated decreased 14.1%. The decrease in PV premiums originated was due to both a highly competitive, tight-spread environment and a reduced contribution from the higher-premium health care sector. The average return on FSA’s new municipal business met the Company’s return objectives.
U.S. ASSET-BACKED ORIGINATIONS
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross par insured (dollars in billions) | | $ | 4.2 | | $ | 5.1 | |
PV premiums originated (dollars in millions) | | 60.8 | | 34.9 | |
| | | | | | | |
U.S. asset-backed originations declined 18.7% in par volume, due primarily to declines in new residential mortgage and consumer finance originations. However, the sector generated a 74.2% increase in PV premiums originated. FSA executed a variety of transactions during the quarter in the consumer, residential and pooled corporate sectors. Amendments to certain existing transactions at the request of issuers produced additional PV premiums without any corresponding increase in par insured.
INTERNATIONAL ORIGINATIONS
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross par insured (dollars in billions) | | $ | 4.5 | | $ | 3.1 | |
PV premiums originated (dollars in millions) | | 42.3 | | 47.4 | |
| | | | | | | |
FSA’s first-quarter international par insured increased 45.2%, but PV premium production decreased 10.8% because of a shift in the business mix to include substantially more Triple-A and Super Triple-A asset-backed transactions, which tend to have shorter terms and lower PV premiums relative to par than public infrastructure financings.
FINANCIAL PRODUCTS ORIGINATIONS
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross PV NIM originated (dollars in millions) | | $ | 12.8 | | $ | 15.5 | |
| | | | | | | |
Non-GAAP PV NIM originated in the financial products segment decreased 17.4% for the first quarter. Though demand for FSA-insured GICs remained strong in both the municipal and structured finance sectors, PV NIM declined because the Company invested primarily in highly liquid, Triple-A, short-dated floating rate instruments in anticipation of widening credit spreads.
ANALYSIS OF FINANCIAL RESULTS
NET INCOME. First-quarter net income decreased 4.6% to $80.1 million from $84.0 million in the first quarter of 2004. The following table provides the after-tax amounts of certain income and expense items that management believes are useful in analyzing net income.
NOTEWORTHY ITEMS INCLUDED IN NET INCOME
(All items shown net of taxes. Dollars in millions)
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Premiums from refundings and accelerations (1) | | $ | 5.3 | | $ | 4.1 | |
Realized gains (losses), net | | (0.7 | ) | 0.4 | |
Realized gains from assets acquired in refinancing transactions, net | | 3.5 | | — | |
Equity-based compensation (2) | | (7.6 | ) | (7.2 | ) |
Equity in earnings of SPS (3) | | (0.5 | ) | 0.2 | |
Dividends received from and equity in earnings of XLFA (4) | | 2.1 | | 4.0 | |
Fair-value adjustments for insured CDS (5) | | (1.6 | ) | 10.2 | |
| | | | | | | |
(1) Net of deferred acquisition cost amortization.
(2) The Company has always included in net income the currently vested future-value payout cost of its performance share unit program, which is the Company’s only equity-based compensation program.
(3) SPS Holding Corp. (SPS) is a mortgage servicing holding company in which the Company owns a minority interest. Due to the proposed sale of SPS, the Company is no longer eligible for a dividends received deduction and therefore recorded additional tax expense of $1.6 million to reverse the inception-to-date tax benefit. At March 31, 2005, the Company’s interest in SPS had a book value of $51.4 million.
(4) The Company owns preferred shares of XL Financial Assurance Ltd (XLFA), a financial guaranty insurance company. XLFA reinsures business originated by FSA and other financial guarantors. In the fourth quarter of 2004, the Company began to account for its investment in XLFA as an equity security under Statement of Financial Accounting Standards No. 115 (SFAS 115).
(5) This item is excluded from operating earnings.
OPERATING EARNINGS. The Company defines operating earnings (a non-GAAP measure) as net income before the effects of fair-value adjustments for FSA-insured CDS that have investment-grade underlying credit quality and must be marked to fair value under Statement of Financial Accounting Standards No. 133 (SFAS No. 133). CDS contracts are generally non-cancelable prior to maturity, and the Company views insured CDS risks as comparable to other insured risks. In a typical CDS transaction, the Company, in exchange for an upfront or periodic premium, indemnifies the insured for economic losses related to specified reference obligations, primarily pools of corporate debt securities or bank loans, structured such that the risk insured is investment grade without the benefit of the credit protection provided by the Company. In the event a CDS were to migrate below investment grade, the fair-value impact would be fully reflected in operating earnings. Management believes it is probable that the financial impact of the fair-value adjustments for the insured CDS will disappear over the finite terms of the exposures, which are typically five to seven years at inception.
First-quarter operating earnings of $81.7 million were higher than net income because they exclude pre-tax negative fair-value adjustments totaling $2.6 million. The fair-value adjustments primarily reflect a slight widening of market credit spreads. The comparable fair-value adjustments in the first quarter of 2004 were gains totaling $15.1 million.
PREMIUMS. The following table reconciles gross premiums written, which captures all premiums collected in a period regardless of when the related business was originated, to PV premiums originated, a non-GAAP measure that management uses to evaluate current business production.
RECONCILIATION OF GROSS PREMIUMS WRITTEN TO PV PREMIUMS ORIGINATED
(Dollars in millions)
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Gross premiums written | | $ | 164.0 | | $ | 189.5 | |
Gross installment premiums received | | (76.9 | ) | (72.0 | ) |
Gross upfront premiums originated | | 87.1 | | 117.5 | |
PV estimated installment premiums originated | | 92.8 | | 54.2 | |
PV premiums originated | | 179.9 | | 171.7 | |
| | | | | | | |
The following table summarizes earned and written premiums, net of reinsurance.
NET EARNED AND WRITTEN PREMIUMS
(Dollars in millions)
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Net premiums written | | $ | 109.5 | | $ | 116.5 | |
Net premiums earned | | 94.9 | | 92.2 | |
Net premiums earned excluding effect of refundings and accelerations (1) | | 85.5 | | 84.5 | |
| | | | | | | |
(1) On an after-tax basis, $57.7 million in the first quarter of 2005 and $57.5 million in the first quarter of 2004.
For the first quarter, gross premiums written decreased 13.4% to $164.0 million, and net premiums written decreased 6.0% to $109.5 million, largely due to a decline in municipal originations, for which premiums are generally collected upfront.
For the first quarter, net premiums earned totaled $94.9 million, a 2.9% increase. This includes $9.4 million of net premiums earned from refundings and accelerations, compared with $7.7 million in the first quarter of 2004. Excluding premiums from refundings and accelerations, first-quarter net premiums earned increased 1.2%, reflecting growth in municipal earned premiums offset by a decline in asset-backed earned premiums.
NET INTEREST MARGIN. First-quarter net interest margin for the financial products segment was $7.3 million in the first quarter of 2005, compared with $5.3 million a year ago. The increase in net interest margin is due primarily to a larger book of GIC business in the first quarter of 2005.
INVESTMENT PORTFOLIO. First-quarter net investment income was $49.5 million, an increase of 20.4%. The increase primarily reflects higher invested balances in the investment portfolio and the inclusion of XLFA dividends of $2.6 million. Through the third quarter of 2004, the investment in preferred shares of XLFA was recorded as equity in earnings of an unconsolidated affiliate. It is now treated as part of the investment portfolio in accordance with SFAS 115. First-quarter net realized gains, including amounts from refinanced transactions, were $4.3 million, compared with $0.5 million a year ago. The Company’s effective tax rate on investment income (excluding the effects of realized gains and losses and variable interest entities) for the first quarter was 11.0%, versus 9.5% for the previous year’s first quarter.
EXPENSES AND RESERVES. For the first quarter, policy acquisition and other operating expenses increased to $42.1 million ($28.2 million after taxes) from $36.6 million ($24.9 million after taxes) in the previous year’s first quarter. Of the $5.5 million increase, $2.8 million reflects changes in deferral rates, following an annual analysis of employee time allocated to new business production. Additionally, in the first quarter of 2005, expenses were increased by write-offs of $1.0 million of uncollectible receivables, and, in the first quarter of 2004, expenses were reduced by reversals of $1.3 million of expense accruals that had proven to be unnecessary.
The Company recorded losses and loss adjustment expenses incurred of $4.0 million ($2.7 million after taxes), compared with $7.7 million ($4.1 million after taxes) in the first quarter of 2004. Adjustments to reserves represent management’s estimate of the amount required to cover the present value of the net cost of claims, based on statistical provisions for new originations.
During the first quarter, a net amount of $1.8 million was transferred from case reserves to the non-specific reserve, primarily reflecting adjustments to existing case reserves for certain CDO transactions. Transfers between general and case reserves represent a reallocation of existing loss reserves and have no impact on earnings. At March 31, 2005, aggregate case and general reserves, net of reinsurance recoverables, totaled $147.9 million, compared with $144.5 million at December 31, 2004.
NON-GAAP MEASURES
To reflect accurately how the Company’s management evaluates the Company’s operations and progress toward long-term goals, this release contains both measures promulgated in accordance with accounting principles generally accepted in the United States of America (GAAP measures) and measures not so promulgated (non-GAAP measures). Although the measures identified as non-GAAP in this release should not be considered substitutes for GAAP measures, management considers them key performance indicators and employs them in determining compensation. Non-GAAP measures therefore provide investors with important information about the way management analyzes its business and rewards performance. A more complete discussion of these non-GAAP measures appears in Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2004, which has been filed with the Securities and Exchange Commission.
Non-GAAP measures used in this release include ABV, operating earnings, PV premiums originated, PV NIM originated and PV originations. In the tables above, operating earnings is reconciled to net income, and PV premiums originated is reconciled to gross premiums written. PV NIM originated is the present value of estimated future net interest margin generated by new business in the financial products segment during a given period. PV originations is the sum of PV premiums originated and PV NIM originated. The Company employs PV originations to describe the present value of all the Company’s originations in a given period.
ABV is reconciled to book value in the table below. ABV consists of book value plus net deferred premium revenues and the estimated value of future contractual cash flows related to financial guaranty and financial products transactions in force as of the balance sheet date, less net deferred acquisition costs and fair-value adjustments for insured CDS. An investor attempting to evaluate the Company using GAAP measures alone would not have the benefit of this information, which management uses in measuring performance and calculating a portion of employee compensation. The ABV calculation relies on estimates of the amount and timing of installment premiums and net interest margin and applies discount factors to determine the present value. Actual values may vary from the estimates.
RECONCILIATION OF SHAREHOLDERS’ EQUITY TO
NON-GAAP ADJUSTED BOOK VALUE
(Dollars in millions)
| | March 31,
2005 | | December 31,
2004 | |
Shareholders’ Equity (Book Value) (1) | | $ | 2,586.7 | | $ | 2,550.0 | |
After-tax adjustments: | | | | | |
Plus net deferred premium revenues | | 878.1 | | 868.6 | |
Plus present value of future net installment premiums and PV NIM (2) | | 512.9 | | 497.3 | |
Less net deferred acquisition costs | | 207.4 | | 200.3 | |
Less fair-value adjustments for insured CDS | | 29.9 | | 31.4 | |
Adjusted Book Value | | $ | 3,740.4 | | $ | 3,684.2 | |
(1) Includes the effect of after-tax unrealized gains in the investment portfolio, which was $152.5 million at March 31, 2005 and $177.8 million at December 31, 2004.
(2) The discount rate varies according to the year of origination. For each year’s originations, the Company calculates the discount rate as the average pre-tax yield on its investment portfolio for the previous three years. The rate was 5.30% in 2005 and 5.62% in 2004.
This release also contains certain other non-GAAP measures that are based on statutory accounting principles applicable to insurance companies. Management uses such measures because the measures are required by regulators or used by rating agencies to assess the capital adequacy of the Company. The following table presents statutory-basis information for FSA.
CLAIMS-PAYING RESOURCES (STATUTORY BASIS)
FINANCIAL SECURITY ASSURANCE INC. AND SUBSIDIARIES
(Dollars in thousands)
| | March 31,
2005 | | December 31,
2004 | |
Contingency Reserve | | $ | 1,166,058 | | $ | 1,099,462 | |
Capital and Surplus | | 1,155,860 | | 1,181,421 | |
Qualified Statutory Capital | | 2,321,918 | | 2,280,883 | |
Net Unearned Premium Reserve | | 1,672,672 | | 1,649,230 | |
Loss and Loss Adjustment Expenses | | 45,770 | | 48,142 | |
Policyholder Capital and Reserves | | 4,040,360 | | 3,978,255 | |
Net Present Value of Installment Premiums | | 747,018 | | 727,340 | |
Third-Party Capital Support (1) | | 525,000 | | 525,000 | |
Total Claims-Paying Resources (2) | | $ | 5,312,378 | | $ | 5,230,595 | |
| | | | | |
Net Insurance in Force (principal & interest) | | $ | 463,749,719 | | $ | 454,359,331 | |
Capital Ratio (3) | | 200:1 | | 199:1 | |
Claims-Paying Ratio (4) | | 87:1 | | 87:1 | |
(1) Standby line of credit facility and money market committed preferred trust securities.
(2) Total claims-paying resources refers to a term used by rating agencies to quantify total resources available to pay claims in their stress-case scenarios.
(3) Capital ratio is net insurance in force divided by qualified statutory capital.
(4) Claims-paying ratio is net insurance in force divided by claims-paying resources.
ADDITIONAL INFORMATION
The Company will post its current Operating Supplement to its website, www.fsa.com, today. The Operating Supplement contains additional information about results for the period covered in this release.
FORWARD-LOOKING STATEMENTS
The Company relies on the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. This safe harbor requires that the Company specify important factors that could cause actual results to differ materially from those contained in forward-looking statements made by or on behalf of the Company. Accordingly, forward-looking statements by the Company and its affiliates are qualified by reference to the following cautionary statements.
In its filings with the SEC, reports to shareholders, press releases and other written and oral communications, the Company from time to time makes forward-looking statements. Such forward-looking statements include, but are not limited to:
• projections of revenues, income (or loss), earnings (or loss) per share, dividends, market share or other financial forecasts
• statements of plans, objectives or goals of the Company or its management, including those related to growth in adjusted book value or return on equity; and
• expected losses on, and adequacy of loss reserves for, insured transactions. Words such as “believes,” “anticipates,” “expects,” “intends” and “plans” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.
The Company cautions that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in forward-looking statements made by the Company. These factors include:
• changes in capital requirements or other criteria of securities rating agencies applicable to financial guaranty insurers in general or to FSA specifically
• competitive forces, including the conduct of other financial guaranty insurers in general
• changes in domestic or foreign laws or regulations applicable to the Company, its competitors or its clients
• changes in accounting principles or practices that may result in a decline in securitization transactions or affect the Company’s reported financial results
• an economic downturn or other economic conditions (such as a rising interest rate environment) adversely affecting transactions insured by FSA or its investment portfolio
• inadequacy of reserves established by the Company for losses and loss adjustment expenses
• temporary or permanent disruptions in cash flow on FSA-insured structured transactions attributable to legal challenges to such structures
• downgrade or default of one or more of FSA’s reinsurers
• the amount and nature of business opportunities that may be presented to the Company
• market conditions, including the credit quality and market pricing of securities issued
• capacity limitations that may impair investor appetite for FSA-insured obligations
• market spreads and pricing on insured credit default swap exposures, which may result in gain or loss due to mark-to-market accounting requirements
• prepayment speeds on FSA-insured asset-backed securities and other factors that may influence the amount of installment premiums paid to FSA
• changes in the value or performance of strategic investments made by the Company, and
• other factors, most of which are beyond the Company’s control.
The Company cautions that the foregoing list of important factors is not exhaustive. In any event, such forward-looking statements made by the Company speak only as of the date on which they are made, and the Company does not undertake any obligation to update or revise such statements as a result of new information, future events or otherwise.
THE COMPANY
Financial Security Assurance Holdings Ltd. (FSA Holdings) is a New York-headquartered holding company whose subsidiaries provide financial guarantees in both the public and private sectors around the world. Its principal operating subsidiary, Financial Security Assurance Inc. (FSA), is a leading guarantor of municipal bonds, infrastructure financings and asset-backed securities. FSA has earned Triple-A ratings, the highest ratings available, from Fitch Ratings, Moody’s Investors Service, Inc., Standard & Poor’s Ratings Services and Rating and Investment Information, Inc. FSA Holdings is a member of the Dexia group, a leading European banking group. For additional information, visit www.fsa.com.
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations and Comprehensive Income
(in thousands)
| | Three Months Ended
March 31, | |
| | 2005 | | 2004 | |
Revenues: | | | | | |
Net premiums written | | $ | 109,502 | | $ | 116,494 | |
| | | | | |
Net premiums earned | | 94,881 | | 92,210 | |
Net investment income | | 49,446 | | 41,077 | |
Net realized gains (losses) | | (1,095 | ) | 495 | |
Net interest income from financial products and variable interest entities | | 78,512 | | 41,024 | |
Financial products net realized gains | | 91 | | 119 | |
Net realized and unrealized gains (losses) on derivative instruments | | (2,024 | ) | 13,039 | |
Income from assets acquired in refinancing transactions | | 7,017 | | 201 | |
Net realized gains from assets acquired in refinancing transactions | | 5,433 | | — | |
Other income | | 5,158 | | 7,357 | |
TOTAL REVENUES | | 237,419 | | 195,522 | |
Expenses: | | | | | |
Losses and loss adjustment expenses | | 3,984 | | 7,700 | |
Interest expense | | 6,788 | | 6,748 | |
Policy acquisition costs | | 15,408 | | 14,798 | |
Net interest expense from financial products and variable interest entities | | 77,018 | | 34,646 | |
Other operating expenses | | 26,708 | | 21,813 | |
TOTAL EXPENSES | | 129,906 | | 85,705 | |
Minority interest | | (2,404 | ) | (4,603 | ) |
Equity in earnings of unconsolidated affiliates | | 1,736 | | 4,886 | |
INCOME BEFORE INCOME TAXES | | 106,845 | | 110,100 | |
Provision for income taxes | | 26,699 | | 26,053 | |
NET INCOME | | 80,146 | | 84,047 | |
Other comprehensive income (loss), net of tax: | | | | | |
Unrealized gains (losses) on securities: | | | | | |
Holding gains (losses) arising during period | | (22,489 | ) | 27,189 | |
Less: reclassification adjustment for gains included in net income | | 2,817 | | 497 | |
Other comprehensive income (loss) | | (25,306 | ) | 26,692 | |
COMPREHENSIVE INCOME | | $ | 54,840 | | $ | 110,739 | |
See Notes to Consolidated Financial Statements to be filed on Form 10-Q.
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD. AND SUBSIDIARIES
(in thousands, except share data)
| | March 31,
2005 | | December 31,
2004 | |
ASSETS | | | | | |
Bonds at fair value (amortized cost of $3,745,145 and $3,662,584) | | $ | 3,940,582 | | $ | 3,914,763 | |
Equity securities at fair value (cost of $54,300 and $54,300) | | 54,300 | | 54,300 | |
Short-term investments | | 188,113 | | 321,071 | |
Variable interest entities’ bonds at fair value (amortized cost of $1,296,208 and $1,346,109) | | 1,296,020 | | 1,346,355 | |
Variable interest entities’ short-term investment portfolio | | 49,763 | | 1,194 | |
Financial products bond portfolio at fair value (amortized cost of $9,409,471 and $7,914,471) | | 9,444,941 | | 7,925,072 | |
Financial products bond portfolio pledged as collateral at fair value (amortized cost of $5,908) | | — | | 5,913 | |
Financial products short-term investment portfolio | | 744,762 | | 268,125 | |
Total investment portfolio | | 15,718,481 | | 13,836,793 | |
Assets acquired in refinancing transactions: | | | | | |
Bonds at fair value (amortized cost of $110,746 and $151,895) | | 110,308 | | 157,036 | |
Securitized loans | | 348,973 | | 371,092 | |
Other | | 207,431 | | 224,908 | |
Total assets acquired in refinancing transactions | | 666,712 | | 753,036 | |
Cash | | 40,824 | | 14,353 | |
Deferred acquisition costs | | 319,117 | | 308,015 | |
Prepaid reinsurance premiums | | 773,352 | | 759,191 | |
Investment in unconsolidated affiliates | | 51,381 | | 49,645 | |
Reinsurance recoverable on unpaid losses | | 35,080 | | 35,419 | |
Other assets | | 1,325,288 | | 1,324,355 | |
TOTAL ASSETS | | $ | 18,930,235 | | $ | 17,080,807 | |
| | | | | |
LIABILITIES AND MINORITY INTEREST AND SHAREHOLDERS’ EQUITY | | | | | |
Deferred premium revenue | | $ | 2,124,205 | | $ | 2,095,423 | |
Losses and loss adjustment expenses | | 183,020 | | 179,941 | |
Guaranteed investment contracts and variable interest entities’ debt | | 12,225,173 | | 10,734,357 | |
Deferred federal income taxes | | 212,447 | | 216,619 | |
Notes payable | | 430,000 | | 430,000 | |
Accrued expenses, minority interest and other liabilities | | 1,168,660 | | 874,510 | |
| | | | | |
TOTAL LIABILITIES AND MINORITY INTEREST | | 16,343,505 | | 14,530,850 | |
| | | | | |
COMMITMENTS AND CONTINGENCIES | | | | | |
Common stock (200,000,000 shares authorized; 33,517,995 issued; par value of $.01 per share) | | 335 | | 335 | |
Additional paid-in capital – common | | 899,912 | | 900,215 | |
Accumulated other comprehensive income (net of deferred income taxes of $80,645 and $91,926) | | 152,490 | | 177,796 | |
Accumulated earnings | | 1,533,993 | | 1,471,611 | |
Deferred equity compensation | | 20,177 | | 23,528 | |
Less treasury stock at cost (254,736 and 297,276 shares held) | | (20,177 | ) | (23,528 | ) |
| | | | | |
TOTAL SHAREHOLDERS’ EQUITY | | 2,586,730 | | 2,549,957 | |
| | | | | |
TOTAL LIABILITIES AND MINORITY INTEREST AND SHAREHOLDERS’ EQUITY | | $ | 18,930,235 | | $ | 17,080,807 | |
See Notes to Consolidated Financial Statements to be filed on Form 10-Q.
Financial Security Assurance Holdings Ltd.
Operating Expense Analysis
(dollars in thousands)
2005 | | 1st Qtr. | | 2nd Qtr. | | 3rd Qtr. | | 4th Qtr. | | Year | |
| | | | | | | | | | | |
Amortization of previously deferred underwriting expenses and reinsurance commissions | | $ | 15,408 | | | | | | | | $ | 15,408 | |
| | | | | | | | | | | |
Gross underwriting and operating expenses | | 60,627 | | | | | | | | 60,627 | |
Underwriting expenses deferred | | (36,640 | ) | | | | | | | (36,640 | ) |
Financial products other operating expenses | | 2,721 | | | | | | | | 2,721 | |
Reinsurance commissions received, net | | (10,131 | ) | | | | | | | (10,131 | ) |
Reinsurance commissions deferred, net | | 10,131 | | | | | | | | 10,131 | |
Other operating expenses | | 26,708 | | | | | | | | 26,708 | |
| | | | | | | | | | | |
Total expenses | | $ | 42,116 | | | | | | | | $ | 42,116 | |
2004 | | 1st Qtr. | | 2nd Qtr. | | 3rd Qtr. | | 4th Qtr. | | Year | |
| | | | | | | | | | | |
Amortization of previously deferred underwriting expenses and reinsurance commissions | | $ | 14,798 | | $ | 13,821 | | $ | 15,989 | | $ | 17,594 | | $ | 62,202 | |
| | | | | | | | | | | |
Gross underwriting and operating expenses | | 58,159 | | 56,410 | | 60,448 | | 70,326 | | 245,343 | |
Underwriting expenses deferred | | (38,098 | ) | (36,786 | ) | (47,382 | ) | (40,143 | ) | (162,409 | ) |
Financial products other operating expenses | | 1,774 | | 1,637 | | 2,389 | | 2,088 | | 7,888 | |
Reinsurance commissions received, net | | (19,245 | ) | (18,309 | ) | (13,391 | ) | (14,893 | ) | (65,838 | ) |
Reinsurance commissions deferred, net | | 19,245 | | 18,309 | | 13,391 | | 14,893 | | 65,838 | |
Other operating expenses | | 21,835 | | 21,261 | | 15,455 | | 32,271 | | 90,822 | |
| | | | | | | | | | | |
Total expenses | | $ | 36,633 | | $ | 35,082 | | $ | 31,444 | | $ | 49,865 | | $ | 153,024 | |
Financial Security Assurance Holdings Ltd.
Effect of Insured Bond Refundings
(dollars in thousands)
2005 | | 1st Qtr. | | 2nd Qtr. | | 3rd Qtr. | | 4th Qtr. | | Year | |
| | | | | | | | | | | |
Earned premium recognized | | $ | 9,405 | | | | | | | | $ | 9,405 | |
Less: | | | | | | | | | | | |
Deferred acquisition costs recognized | | 1,323 | | | | | | | | 1,323 | |
Net effect before taxes | | 8,082 | | | | | | | | 8,082 | |
Tax provision | | 2,829 | | | | | | | | 2,829 | |
Net income effect | | 5,253 | | | | | | | | 5,253 | |
| | | | | | | | | | | | | |
2004 | | 1st Qtr. | | 2nd Qtr. | | 3rd Qtr. | | 4th Qtr. | | Year | |
| | | | | | | | | | | |
Earned premium recognized | | $ | 7,745 | | $ | 14,539 | | $ | 9,998 | | $ | 12,122 | | $ | 44,404 | |
Less: | | | | | | | | | | | |
Deferred acquisition costs recognized | | 1,458 | | 1,521 | | 1,988 | | 2,902 | | 7,869 | |
Net effect before taxes | | 6,287 | | 13,018 | | 8,010 | | 9,220 | | 36,535 | |
Tax provision | | 2,200 | | 4,556 | | 2,804 | | 3,227 | | 12,787 | |
Net income effect | | 4,087 | | 8,462 | | 5,206 | | 5,993 | | 23,748 | |
| | | | | | | | | | | | | | | | |
Financial Security Assurance Holdings Ltd.
Annual Financial Data
(dollars in thousands)
| | Years Ended December 31, | |
| | 2004 | | 2003 | | 2002 | | 2001 | | 2000 | |
| | | | | | | | | | | |
Income Statement | | | | | | | | | | | |
Gross premiums written | | $ | 831,980 | | $ | 895,826 | | $ | 803,701 | | $ | 485,570 | | $ | 372,325 | |
Net premiums written | | 587,769 | | 614,284 | | 532,747 | | 319,638 | | 218,138 | |
Net premiums earned | | 395,015 | | 356,373 | | 314,880 | | 230,999 | | 192,149 | |
Net investment income | | 177,289 | | 154,048 | | 139,120 | | 128,921 | | 121,144 | |
Losses and loss adjustment expenses | | 20,599 | | 34,486 | | 65,613 | | 12,497 | | 9,403 | |
Income before income taxes and cumulative effect of accounting change | | 465,442 | | 376,373 | | 216,179 | | 269,477 | | 67,401 | (1) |
Net income | | 363,784 | | 290,586 | | 181,075 | | 209,496 | | 63,283 | (1) |
| | | | | | | | | | | |
Balance Sheet | | | | | | | | | | | |
Total investments | | $ | 14,044,558 | | $ | 9,493,216 | | $ | 5,037,395 | | $ | 3,214,097 | | $ | 2,234,851 | |
Prepaid reinsurance premiums | | 759,191 | | 695,398 | | 557,659 | | 420,798 | | 354,117 | |
Total assets | | 17,076,819 | | 12,409,760 | | 7,027,483 | | 4,308,854 | | 3,148,694 | |
Deferred premium revenue | | 2,095,423 | | 1,861,960 | | 1,450,211 | | 1,090,332 | | 936,826 | |
Notes payable | | 430,000 | | 430,000 | | 430,000 | | 330,000 | | 230,000 | |
Total liabilities and minority interest | | 14,530,850 | | 10,241,324 | | 5,159,113 | | 2,672,896 | | 1,682,961 | |
Shareholders’ equity | | 2,549,957 | | 2,168,436 | | 1,868,370 | | 1,635,958 | | 1,465,733 | |
(1) Includes $105,541 of merger related costs.
Financial Security Assurance Inc.
Financial Security Assurance Inc.
Investment Portfolio
(dollars in thousands)
Investment Portfolio as of March 31, 2005(1)
Type of Security | | Amortized
Cost | | Market
Value | | % of
Amortized
Cost | | Yield(2) | | Annualized
Income(3) | |
Long-term bonds: | | | | | | | | | | | |
Tax-exempt | | $ | 2,899,630 | | $ | 3,073,609 | | 74.3 | % | 5.00 | % | $ | 145,021 | |
Taxable | | 842,210 | | 845,604 | | 21.1 | | 4.75 | | 39,180 | |
Short-term | | 180,016 | | 180,016 | | 4.6 | | 2.01 | | 2,759 | |
| | | | | | | | | | | |
Total | | $ | 3,903,856 | | $ | 4,099,229 | | 100.0 | % | 4.84 | % | $ | 186,960 | |
Maturity | | Amortized
Cost | | % of
Amortized
Cost | | | | Quality Distribution
of Long-Term Fixed
Income Investments (4) | |
Within 1 year | | $ | 255,110 | | 6.5 | % | | | AAA | | 76.4 | % |
1 to 5 years | | 647,834 | | 16.6 | | | | AA | | 19.0 | |
5 to 10 years | | 591,352 | | 15.2 | | | | A | | 4.5 | |
10 or more years | | 2,117,343 | | 54.2 | | | | NR | | 0.1 | |
Mortgage-backed securities | | 59,024 | | 1.5 | | | | | | 100.0 | % |
Asset-backed securities | | 233,193 | | 6.0 | | | | | | | |
| | | | | | | | | | | |
Total | | $ | 3,903,856 | | 100.0 | % | | | | | | |
(1) | Excludes portfolio related to the variable interest entities bond portfolio. |
(2) | Estimated yield on assets at end of reporting quarter; short-term investments includes taxable and tax-exempt securities but excludes cash equivalents of $43.0 million. |
(3) | Before taxes if applicable; based on indicated yields. |
(4) | Ratings are based on the lower of Moody’s or S&P ratings available at March 31, 2005. |
Financial Security Assurance Inc.
Statutory Analytics and Selected Annual Financial Statistics
(dollars in thousands)
Statutory Analytics | | 1st Qtr.
2005 | | Year-to-date
2005 | | Full Year
2004 | |
| | | | | | | |
Loss ratio(1) | | (2.0 | )% | (2.0 | )% | 5.0 | % |
Expense ratio(1) | | 38.3 | | 38.3 | | 26.8 | |
Combined ratio(1) | | 36.3 | | 36.3 | | 31.8 | |
| | | | | | | |
| | | | 3/31/05 | | 12/31/04 | |
Contingency reserve | | | | $ | 1,166,058 | | $ | 1,099,462 | |
Capital and surplus | | | | 1,155,860 | | 1,181,421 | |
Qualified statutory capital | | | | 2,321,918 | | 2,280,883 | |
Unearned premium reserve | | | | 1,672,672 | | 1,649,230 | |
Loss and loss adjustment expenses | | | | 45,770 | | 48,142 | |
Policyholder capital and reserves | | | | 4,040,360 | | 3,978,255 | |
Net present value of installment premiums | | | | 747,018 | | 727,340 | |
Third-party capital support | | | | 525,000 | | 525,000 | |
Total claims-paying resources | | | | $ | 5,312,378 | | $ | 5,230,595 | |
| | | | | | | |
| | | | | | | |
Net insurance in force (principal & interest) | | | | $ | 463,749,719 | | $ | 454,359,331 | |
Capital ratio(2) | | | | 200:1 | | 199:1 | |
Claims-paying ratio(3) | | | | 87:1 | | 87:1 | |
| | | | | | | | | | | |
| | Years Ended December 31, | |
| | 2004 | | 2003 | | 2002 | | 2001 | | 2000 | |
Selected Financial Statistics | | | | | | | | | | | |
GAAP Basis(1) | | | | | | | | | | | |
Loss ratio (%) | | 5.0 | % | 9.5 | % | 20.6 | % | 5.4 | % | 4.9 | % |
Expense ratio (%) | | 30.2 | | 31.8 | | 31.6 | | 34.6 | | 54.5 | |
Combined ratio (%) | | 35.2 | | 41.3 | | 52.2 | | 40.0 | | 59.4 | |
SAP Basis(1) | | | | | | | | | | | |
Loss ratio (%) | | 5.0 | | 3.7 | | 15.1 | | 4.0 | | (0.5 | ) |
Expense ratio (%) | | 26.8 | | 21.3 | | 20.9 | | 37.1 | | 59.1 | |
Combined ratio (%) | | 31.8 | | 25.0 | | 36.0 | | 41.1 | | 58.6 | |
| | | | | | | | | | | |
Selected Financial Statistics(3) | | | | | | | | | | | |
Gross insurance in force | | $ | 633,037,230 | | $ | 565,371,437 | | $ | 512,232,953 | | $ | 422,296,318 | | $ | 321,753,871 | |
Net insurance in force | | 454,359,331 | | 409,476,253 | | 365,256,111 | | 300,637,067 | | 225,426,403 | |
Qualified statutory capital | | 2,280,883 | | 2,104,257 | | 1,876,117 | | 1,593,570 | | 1,436,681 | |
Capital ratio | | 199:1 | | 195:1 | | 194:1 | | 189:1 | | 157:1 | |
| | | | | | | | | | | | | | | | |
(1) The GAAP loss ratio is losses and loss adjustment expenses incurred (inclusive of additions to the General Reserve) divided by net premiums earned. The SAP loss ratio is losses and loss adjustment expenses incurred (exclusive of additions to the General Reserve) divided by net premiums earned. The GAAP expense ratio is underwriting and operating expenses divided by net premiums earned. The SAP expense ratio is underwriting and operating expenses divided by net premiums written. The combined ratio on both a GAAP and SAP basis is the sum of the applicable loss and expense ratios.
(2) Capital ratio is net insurance in force divided by qualified statutory capital.
(3) Claims-paying ratio is net insurance in force divided by claims-paying resources.
(4) Amounts are statutory data for FSA as a separate company and therefore include amounts relating to FSA-insured GICs issued by the GIC Subsidiaries, FSA Global investments insured by FSA and Canadian Global debt insured by FSA.
Municipal New-Issue Market Data(1)
(dollars in billions)
| | Par Value | | Percent | | FSA Market Share(2) | |
| | Issued | | Insured | | Insured | | Amount | | Percent | |
| | | | | | | | | | | |
1st Qtr. 2005 | | $ | 98.0 | | $ | 60.9 | | 62.1 | % | $ | 14.6 | | 23.9 | % |
| | | | | | | | | | | |
4th Qtr. 2004 | | 91.1 | | 46.7 | | 51.3 | | 11.5 | | 24.6 | |
3rd | | 78.9 | | 45.9 | | 58.2 | | 10.9 | | 23.7 | |
2nd | | 103.6 | | 61.0 | | 58.9 | | 12.9 | | 21.1 | |
1st | | 86.6 | | 39.7 | | 45.8 | | 11.6 | | 29.2 | |
| | | | | | | | | | | |
2004 | | 360.2 | | 193.3 | | 53.7 | | 46.9 | | 24.3 | |
2003 | | 383.7 | | 190.5 | | 49.6 | | 52.2 | | 27.4 | |
2002 | | 358.8 | | 178.9 | | 49.9 | | 47.5 | | 26.6 | |
2001 | | 288.2 | | 134.3 | | 46.6 | | 36.3 | | 27.0 | |
2000 | | 200.7 | | 79.3 | | 39.5 | | 19.5 | | 24.6 | |
1999 | | 227.6 | | 105.6 | | 46.4 | | 24.2 | | 22.9 | |
1998 | | 286.7 | | 145.5 | | 50.8 | | 32.0 | | 22.0 | |
1997 | | 220.7 | | 107.5 | | 48.7 | | 16.2 | | 15.1 | |
1996 | | 185.2 | | 85.7 | | 46.3 | | 11.2 | | 13.1 | |
1995 | | 160.4 | | 68.6 | | 42.8 | | 3.3 | | 4.8 | |
1994 | | 165.1 | | 61.5 | | 37.3 | | 2.7 | | 4.4 | |
1993 | | 292.2 | | 107.9 | | 36.9 | | 7.5 | | 7.0 | |
1992 | | 234.7 | | 80.8 | | 34.4 | | 4.8 | | 5.9 | |
1991 | | 172.4 | | 51.9 | | 30.1 | | 2.8 | | 5.4 | |
| | | | | | | | | | | | | | |
(1) FSA estimates based on industry sources, including The Bond Buyer and Thomson Financial Securities Data. Industry data is on a sale-date basis and subject to revision as additional information becomes available.
(2) Share of insured bond market. FSA volume for 1993 through 2005 is based on sale dates and will differ from closing-date data presented elsewhere in this Supplement. Excludes secondary-market and non-U.S. transactions.
Financial Security Assurance Inc.
Gross Par Value and Present Value Originated (1)
(dollars in millions)
| | 1st Quarter | | Year-to-Date | |
| | 2005 | | 2004 | | 2005 | | 2004 | |
Municipal (U.S. and international) | | | | | | | | | |
Gross par insured | | $ | 13,026 | | $ | 11,642 | | $ | 13,026 | | $ | 11,642 | |
Gross premiums written | | | | | | | | | |
Up-front | | 77.1 | | 117.1 | | 77.1 | | 117.1 | |
Installments(2) | | 15.1 | | 3.6 | | 15.1 | | 3.6 | |
Total gross premiums | | 92.2 | | 120.7 | | 92.2 | | 120.7 | |
| | | | | | | | | |
Gross present value of premiums originated(3) | | 99.5 | | 125.0 | | 99.5 | | 125.0 | |
| | | | | | | | | |
Asset-Backed (U.S. and international) | | | | | | | | | |
Gross par insured | | 7,991 | | 7,596 | | 7,991 | | 7,596 | |
Gross premiums written | | | | | | | | | |
Up-front | | 10.0 | | 0.4 | | 10.0 | | 0.4 | |
Installments(2) | | 68.6 | | 68.4 | | 68.6 | | 68.4 | |
Total gross premiums | | 78.6 | | 68.8 | | 78.6 | | 68.8 | |
| | | | | | | | | |
Gross present value of premiums originated (3) | | 80.4 | | 46.7 | | 80.4 | | 46.7 | |
| | | | | | | | | |
Financial Products | | | | | | | | | |
Gross par value insured(4) | | 2,125 | | 842 | | 2,125 | | 842 | |
| | | | | | | | | |
Gross present value of net interest margin originated(5) | | 12.8 | | 15.5 | | 12.8 | | 15.5 | |
| | | | | | | | | |
Total Portfolio | | | | | | | | | |
| | | | | | | | | |
Gross par insured | | 23,142 | | 20,080 | | 23,142 | | 20,080 | |
Gross premiums written | | | | | | | | | |
Up-front | | 87.1 | | 117.5 | | 87.1 | | 117.5 | |
Installments | | 83.7 | | 72.0 | | 83.7 | | 72.0 | |
Total gross premiums | | 170.8 | | 189.5 | | 170.8 | | 189.5 | |
| | | | | | | | | |
Gross present value of originations | | 192.7 | | 187.2 | | 192.7 | | 187.2 | |
| | | | | | | | | | | | | |
(1) Amounts are statutory data for FSA as a separate company and therefore include amounts relating to FSA-insured GICs issued by the GIC Subsidiaries, FSA Global investments insured by FSA and Canadian Global debt insured by FSA.
(2) Installments are the periodic premium payments received by FSA for business written in current and prior years.
(3) The Company evaluates its insurance business production for a given period by its gross present value (PV) of premiums originated. Gross PV premiums originated for a particular period includes both (i) the amount of premiums received in such period under all insurance policies in which premiums are payable up front and (ii) the amount of all future premiums estimated to be payable under the Company’s installment-based policies issued during such period, discounted to present value. The discount rate for business written in 2005 is 5.30% per annum and in 2004 is 5.62% per annum, equal to the average pre-tax yield on the Company’s investment portfolio for the previous three calendar years. Management uses its best estimate of the life of each insurance policy for which premiums are payable in installments when calculating gross PV premiums originated. However, the actual period over which installment-based premiums are paid and the total amount paid will vary from management’s estimate if the insured obligation remains outstanding for a period that is different from that estimated by management. If the life of an insured obligation is shorter than that estimated, the related gross PV premiums outstanding will be reduced. Conversely, if the life of an insured obligation is longer than that estimated, the related gross PV premiums outstanding will be increased.
(4) Relates only to FSA-insured GICs issued by the Company’s GIC subsidiaries (FSA Capital Markets Services LLC and FSA Capital Management Services LLC), which are consolidated in the Company’s financial statements. For these transactions, the outstanding par amounts are reflected as insurance exposure in FSA’s financial statements but as GIC liabilities in those of the Company. As a result, the total outstanding exposures reported by FSA and the Company differ.
(5) The present value of the net interest margin represents the present value of the difference between the estimated interest to be received on the GIC investments and the estimated interest to be paid on the GIC liabilities over the estimated life of each transaction, giving effect to swaps and other derivatives which convert fixed rate assets and liabilities to floating rates. The discount rate is the same as that used for premiums (see footnote 3).
Financial Security Assurance Inc.
Insured Portfolio Profile - Par Value
(dollars in millions)
| | | | Insured in 2005 | | | | Outstanding as of
March 31, 2005 | |
| | Gross
Amount | | % | | Net
Amount | | % | | Net
Amount | | % | |
Municipal Obligations | | | | | | | | | | | | | |
Domestic | | | | | | | | | | | | | |
General obligation bonds | | $ | 7,740 | | 59.4 | % | $ | 6,305 | | 64.2 | % | $ | 80,443 | | 40.0 | % |
Tax-supported bonds | | 1,553 | | 11.9 | | 1,110 | | 11.3 | | 36,994 | | 18.4 | |
Municipal utility revenue bonds | | 823 | | 6.3 | | 714 | | 7.2 | | 33,753 | | 16.8 | |
Health care revenue bonds | | 734 | | 5.6 | | 273 | | 2.8 | | 9,445 | | 4.7 | |
Housing revenue bonds | | 53 | | 0.4 | | 51 | | 0.5 | | 7,390 | | 3.7 | |
Transportation revenue bonds | | 542 | | 4.2 | | 345 | | 3.5 | | 13,119 | | 6.5 | |
Other municipal bonds | | 870 | | 6.7 | | 678 | | 6.9 | | 11,526 | | 5.7 | |
Subtotal | | 12,315 | | 94.5 | | 9,476 | | 96.4 | | 192,670 | | 95.8 | |
International | | 711 | | 5.5 | | 349 | | 3.6 | | 8,491 | | 4.2 | |
Total municipal obligations | | $ | 13,026 | | 100.0 | % | $ | 9,825 | | 100.0 | % | $ | 201,161 | | 100.0 | % |
| | | | | | | | | | | | | |
Geographic Distribution | | | | | | | | | | | | | |
California | | $ | 1,703 | | 13.1 | % | $ | 1,306 | | 13.3 | % | $ | 27,394 | | 13.6 | % |
New York | | 368 | | 2.8 | | 221 | | 2.2 | | 17,649 | | 8.8 | |
Texas | | 1,216 | | 9.3 | | 796 | | 8.1 | | 13,729 | | 6.8 | |
Pennsylvania | | 817 | | 6.3 | | 743 | | 7.5 | | 12,738 | | 6.3 | |
Florida | | 646 | | 5.0 | | 451 | | 4.6 | | 11,095 | | 5.5 | |
Illinois | | 1,081 | | 8.3 | | 852 | | 8.7 | | 9,943 | | 5.0 | |
New Jersey | | 442 | | 3.4 | | 372 | | 3.8 | | 9,281 | | 4.6 | |
Washington | | 461 | | 3.5 | | 294 | | 3.0 | | 7,504 | | 3.7 | |
Michigan | | 960 | | 7.4 | | 884 | | 9.0 | | 6,696 | | 3.3 | |
Massachusetts | | 659 | | 5.1 | | 441 | | 4.5 | | 5,261 | | 2.6 | |
Wisconsin | | 406 | | 3.1 | | 368 | | 3.7 | | 4,903 | | 2.5 | |
Ohio | | 332 | | 2.5 | | 266 | | 2.7 | | 4,627 | | 2.3 | |
Georgia | | 69 | | 0.5 | | 66 | | 0.7 | | 4,332 | | 2.2 | |
All Other U.S. Jurisdictions | | 3,155 | | 24.2 | | 2,416 | | 24.6 | | 57,518 | | 28.6 | |
International | | 711 | | 5.5 | | 349 | | 3.6 | | 8,491 | | 4.2 | |
Total municipal obligations | | $ | 13,026 | | 100.0 | % | $ | 9,825 | | 100.0 | % | $ | 201,161 | | 100.0 | % |
| | | | | | | | | | | | | |
Asset-Backed Obligations | | | | | | | | | | | | | |
Domestic | | | | | | | | | | | | | |
Residential mortgages | | $ | 482 | | 4.8 | % | $ | 456 | | 4.7 | % | $ | 23,435 | | 17.8 | % |
Consumer receivables | | 310 | | 3.1 | | 293 | | 3.0 | | 8,315 | | 6.3 | |
Pooled corporate obligations | | 3,028 | | 29.9 | | 2,894 | | 30.1 | | 49,106 | | 37.3 | |
Investor-owned utility obligations | | — | | 0.0 | | — | | 0.0 | | 149 | | 0.1 | |
Other asset-backed obligations(1) | | 2,488 | | 24.6 | | 2,479 | | 25.8 | | 17,053 | | 13.0 | |
Subtotal(1) | | 6,308 | | 62.4 | | 6,122 | | 63.6 | | 98,058 | | 74.5 | |
International | | 3,808 | | 37.6 | | 3,507 | | 36.4 | | 33,476 | | 25.5 | |
| | | | | | | | | | | | | |
Total asset-backed obligations(1) | | $ | 10,116 | | 100.0 | % | $ | 9,629 | | 100.0 | % | $ | 131,534 | | 100.0 | % |
| | | | | | | | | | | | | |
Total Portfolio(1) | | $ | 23,142 | | | | $ | 19,454 | | | | $ | 332,695 | | | |
| | | | | | | | | | | | | | | | | |
Distribution of Insured Portfolio by Rating as of March 31, 2005
| | Rating(2) | | | | Percent of Portfolio | |
| | AAA | | | | 25.8 | % |
| | AA | | | | 29.7 | |
| | A | | | | 33.2 | |
| | BBB | | | | 10.7 | |
| | Other | | | | 0.6 | |
| | | | | | 100.0 | % |
(1) Includes amounts related to FSA-insured GICs issued by the GIC subsidiaries, FSA Global investments insured by FSA and Canadian Global debt insured by FSA.
(2) Based upon internal FSA ratings.
Financial Security Assurance Inc.
50 Largest Municipal Exposures
as of March 31, 2005
(dollars in millions)
Obligor | | Net Par Outstanding | | % of Total
Net Par Outstanding | |
Commonwealth of Massachusetts G.O. | | $ | 1,090 | | .33 | % |
New York City, NY, G.O. | | 1,076 | | .32 | |
California Housing Finance Agency Single-Family Mortgage Revenue Bonds | | 1,062 | | .32 | |
State of Washington G.O. | | 1,039 | | .31 | |
Clark County School District, NV, G.O. | | 1,007 | | .30 | |
Atlanta, GA, Water and Sewer Revenue | | 1,002 | | .30 | |
Long Island Power Authority, NY | | 984 | | .30 | |
Seattle, WA, Light and Power | | 949 | | .29 | |
Chicago, Illinois G.O. | | 904 | | .27 | |
State of Hawaii G.O. | | 826 | | .25 | |
New York State Thruway Authority, Highway and Bridge Trust Fund | | 825 | | .25 | |
State of Illinois G.O. | | 808 | | .24 | |
Port Authority of New York and New Jersey, Consolidated Bonds | | 799 | | .24 | |
Metropolitan Transit Authority, NY | | 779 | | .23 | |
District of Columbia, G.O. | | 758 | | .23 | |
New York City, NY, Municipal Water Finance Authority | | 756 | | .23 | |
New Jersey Turnpike Authority Revenue Bonds | | 741 | | .22 | |
State of California G.O. | | 737 | | .22 | |
Houston, TX Airport System | | 733 | | .23 | |
New York Local Government Assistance Corp | | 731 | | .22 | |
Philadelphia, PA, School District G.O. | | 698 | | .21 | |
State of Connecticut Special Tax | | 680 | | .20 | |
Los Angeles USD, CA, G.O. | | 666 | | .20 | |
Detroit, MI, Sewage Disposal System Revenue Bonds | | 651 | | .20 | |
Puerto Rico Electric Power Authority | | 649 | | .20 | |
Metropolitan Transit Authority, NY Dedicated Tax | | 646 | | .19 | |
Kentucky State Property and Buildings Commission Revenue Bonds | | 643 | | .19 | |
Commonwealth of Pennsylvania G.O. | | 640 | | .19 | |
South Carolina Public Service Authority, Santee Cooper | | 639 | | .19 | |
Hydro-Quebec - Province of Quebec Guaranteed | | 622 | | .19 | |
New Jersey Transportation Trust Fund Authority | | 617 | | .19 | |
Florida Public Education (Gross Receipts) | | 610 | | .18 | |
San Diego, CA. Unified School District G.O. | | 605 | | .18 | |
Massachusetts Water Resources Authority, General Revenue | | 602 | | .18 | |
State of California Department of Water Resources Power Supply | | 602 | | .18 | |
NYS Dormitory Authority - Mental Health Services | | 590 | | .18 | |
Los Angeles MTA, CA, Sales Tax Revenue Bonds | | 585 | | .18 | |
State of Florida, Department of Transportation Turnpike Revenue | | 567 | | .17 | |
Energy Northwest Electric Revenue | | 545 | | .16 | |
Michigan State Building Authority | | 544 | | .16 | |
NJHMFA Multi-Family Housing Revenue Bonds | | 539 | | .16 | |
Metropolitan Washington Airport Authority | | 531 | | .16 | |
New Jersey Economic Development Authority State Pension Funding | | 516 | | .16 | |
New York City, NY, Health and Hospital Corp | | 515 | | .16 | |
Miami-Dade County, FL, Aviation Revenue Miami Int’l Airport | | 514 | | .16 | |
Kansas DFA State Appropriation Bonds | | 513 | | .16 | |
City of Philadelphia, Pennsylvania Gas Works Revenue | | 498 | | .15 | |
Commonwealth of Puerto Rico G.O. | | 495 | | .15 | |
City of Atlanta, Georgia, Hartsfield-Jackson Atlanta Airport | | 493 | | .15 | |
Chicago Public Schools, Illinois | | 472 | | .15 | |
| | | | | |
Total | | $ | 35,093 | | 10.55 | % |
Financial Security Assurance Inc
25 Largest Asset-Backed Exposures
as of March 31, 2005
(dollars in millions)
Obligor | | Net Par Outstanding | | % of Total Net
Par Outstanding | |
| | | | | |
International Super AAA Synthetic CDO | | 2,776 | | .83 | % |
International Super AAA Synthetic Residential MBS | | 2,630 | | .79 | |
International Synthetic CDO | | 2,022 | | .61 | |
International Super AAA Synthetic CDO | | 1,852 | | .56 | |
International Synthetic CDO | | 1,642 | | .49 | |
International AAA Synthetic Consumer Receivable Securitization | | 1,533 | | .46 | |
International Super AAA Synthetic CDO | | 1,501 | | .45 | |
International Super AAA Synthetic CDO | | 1,482 | | .45 | |
International Super AAA Synthetic Residential MBS | | 1,471 | | .44 | |
US Super AAA Synthetic CDO | | 1,466 | | .44 | |
Ameriquest Mortgage 2004-R8 | | 1,433 | | .43 | |
International Synthetic CDO | | 1,404 | | .42 | |
International Super AAA Synthetic CDO | | 1,356 | | .41 | |
International Super AAA Synthetic CDO | | 1,324 | | .40 | |
US Super AAA Synthetic CDO | | 1,312 | | .39 | |
International Super AAA Synthetic CDO | | 1,271 | | .38 | |
US Super AAA Synthetic CDO | | 1,211 | | .36 | |
International AAA Synthetic CDO | | 1,190 | | .36 | |
International Super AAA Synthetic CDO | | 1,120 | | .34 | |
Long Beach Mortgage 2004-4 | | 1,105 | | .33 | |
Long Beach Mortgage 2004-1 | | 1,102 | | .33 | |
International Super AAA Synthetic CDO | | 1,083 | | .33 | |
International Super AAA Synthetic Residential MBS | | 1,075 | | .32 | |
International AAA Synthetic CDO | | 1,059 | | .32 | |
Ameriquest Mortgage 2004-R7 | | 1,058 | | .32 | |
Total | | | $ | 36,478 | | 10.96 | % |
| | | | | | | |
“International” denotes a transaction with 20% or greater non-US collateral. “Super AAA” means the level of first-loss protection exceeds 1.3x the level required for an Aaa/AAA rating. Where indicated, ratings are current FSA internal ratings expressed in industry terms.
Financial Security Assurance Inc.
Asset-Backed Debt Service and Premiums (1) (2)
(dollars in millions)
Debt Service
(Principal and Interest)
| | Insured Debt Service | | Portfolio | | Net | |
| | Gross | | Ceded | | Net | | Run Off (2) | | Outstanding | |
| | | | | | | | | | | |
1st Qtr. 2005 | | $ | 8,271 | | $ | 507 | | $ | 7,764 | | $ | (6,155 | ) | $ | 142,132 | |
| | | | | | | | | | | |
4th Qtr. 2004 | | 8,550 | | 1,297 | | 7,253 | | (23,765 | ) | 140,523 | |
3rd | | 32,180 | | 3,819 | | 28,361 | | (8,640 | ) | 157,035 | |
2nd | | 9,459 | | 460 | | 8,999 | | (4,705 | ) | 137,314 | |
1st | | 7,707 | | 786 | | 6,921 | | (7,641 | ) | 133,020 | |
| | | | | | | | | | | |
2004 | | 57,896 | | 6,362 | | 51,534 | | (44,751 | ) | 140,523 | |
2003 | | 25,105 | | 4,553 | | 20,552 | | (28,497 | ) | 133,740 | |
2002 | | 54,129 | | 10,582 | | 43,547 | | (29,166 | ) | 141,685 | |
2001 | | 75,404 | | 10,681 | | 64,723 | | (19,807 | ) | 127,304 | |
2000 | | 44,714 | | 8,181 | | 36,533 | | (19,031 | ) | 82,388 | |
| | | | | | | | | | | | | | | | |
Premiums (GAAP Basis)
| | | | Ending Net | | Net PV | | | |
| | Premium Written | | Unearned | | Premium | | | |
| | Gross | | Ceded | | Net | | Premium | | Outstanding(3) | | Total | |
| | | | | | | | | | | | | |
1st Qtr. 2005 | | $ | 78.6 | | $ | 16.8 | | $ | 61.8 | | $ | 91.9 | | $ | 627.3 | | $ | 719.2 | |
| | | | | | | | | | | | | |
4th Qtr. 2004 | | 68.5 | | 10.7 | | 57.8 | | 89.7 | | 611.9 | | 701.6 | |
3rd | | 86.3 | | 23.3 | | 63.0 | | 87.4 | | 602.8 | | 690.2 | |
2nd | | 86.3 | | 27.4 | | 58.9 | | 85.9 | | 527.7 | | 613.6 | |
1st | | 68.8 | | 18.6 | | 50.2 | | 87.2 | | 528.4 | | 615.6 | |
| | | | | | | | | | | | | |
2004 | | 309.9 | | 80.0 | | 229.9 | | 89.7 | | 611.9 | | 701.6 | |
2003 | | 318.2 | | 91.3 | | 226.9 | | 91.3 | | 518.4 | | 609.7 | |
2002 | | 298.0 | | 82.3 | | 215.7 | | 93.5 | | 520.1 | | 613.6 | |
2001 | | 254.8 | | 86.8 | | 168.0 | | 105.2 | | 510.2 | | 615.4 | |
2000 | | 202.6 | | 68.0 | | 134.6 | | 98.4 | | 352.3 | | 450.7 | |
| | | | | | | | | | | | | | | | | | | |
(1) Amounts are statutory data for FSA as a separate company and therefore include amounts relating to FSA-insured GICs issued by the GIC Subsidiaries, FSA Global investments insured by FSA and Canadian Global debt insured by FSA.
(2) Includes decreases due to prepayments and increases due to accretion or higher outstandings under variable programs. Runoff for fourth quarter 2004 includes decrease of $17 billion due to one-time excess-of-loss facultative reinsurance agreement.
(3) This is a non-GAAP term.
Financial Security Assurance Inc.
Municipal Debt Service and Premiums
(dollars in millions)
Debt Service
(Principal and Interest)
| | Insured Debt Service | | Portfolio | | Net | |
| | Gross | | Ceded | | Net | | Run Off (1) | | Outstanding | |
| | | | | | | | | | | |
1st Qtr. 2005 | | $ | 21,311 | | $ | 5,707 | | $ | 15,604 | | $ | (7,822 | ) | $ | 321,618 | |
| | | | | | | | | | | |
4th Qtr. 2004 | | 22,926 | | 7,056 | | 15,870 | | (4,421 | ) | 313,836 | |
3rd | | 22,921 | | 6,816 | | 16,105 | | (5,021 | ) | 302,387 | |
2nd | | 23,817 | | 7,810 | | 16,007 | | (6,409 | ) | 291,303 | |
1st | | 18,493 | | 5,657 | | 12,836 | | (6,867 | ) | 281,705 | |
| | | | | | | | | | | |
2004 | | 88,157 | | 27,339 | | 60,818 | | (22,718 | ) | 313,836 | |
2003 | | 95,651 | | 22,445 | | 73,206 | | (21,041 | ) | 275,736 | |
2002 | | 92,952 | | 27,048 | | 65,904 | | (15,666 | ) | 223,571 | |
2001 | | 64,821 | | 20,431 | | 44,390 | | (14,095 | ) | 173,333 | |
2000 | | 40,542 | | 16,456 | | 24,086 | | (11,733 | ) | 143,038 | |
| | | | | | | | | | | | | | | | |
Premiums (GAAP Basis)
| | | | | | | | Ending Net | | Net PV | | | |
| | Premium Written | | Unearned | | Premium | | | |
| | Gross | | Ceded | | Net | | Premium | | Outstanding(2) | | Total | |
| | | | | | | | | | | | | |
1st Qtr. 2005 | | $ | 92.2 | | $ | 37.7 | | $ | 54.5 | | $ | 1,264.7 | | $ | 119.7 | | $ | 1,384.4 | |
| | | | | | | | | | | | | |
4th Qtr. 2004 | | 139.7 | | 41.6 | | 98.1 | | 1,252.4 | | 115.4 | | 1,367.8 | |
3rd | | 111.9 | | 26.1 | | 85.8 | | 1,199.6 | | 103.1 | | 1,302.7 | |
2nd | | 149.8 | | 42.1 | | 107.7 | | 1,169.8 | | 102.0 | | 1,271.8 | |
1st | | 120.7 | | 54.4 | | 66.3 | | 1,103.6 | | 88.0 | | 1,191.6 | |
| | | | | | | | | | | | | |
2004 | | 522.1 | | 164.2 | | 357.9 | | 1,252.4 | | 115.4 | | 1,367.8 | |
2003 | | 587.8 | | 190.2 | | 397.6 | | 1,075.3 | | 88.7 | | 1,164.0 | |
2002 | | 508.9 | | 188.6 | | 320.3 | | 799.0 | | 69.6 | | 868.6 | |
2001 | | 230.8 | | 79.2 | | 151.6 | | 564.3 | | 46.2 | | 610.5 | |
2000 | | 169.7 | | 86.2 | | 83.5 | | 484.3 | | 42.0 | | 526.3 | |
| | | | | | | | | | | | | | | | | | | |
(1) Includes decreases due to prepayments and increases due to accretion or higher outstandings under variable programs.
(2) This is a non-GAAP term.
Financial Security Assurance Inc.
Asset-Backed Net Debt Service and Net Premiums
Amortization and Ending Balances (1)
(dollars in millions)
Net Debt Service
| | Scheduled
Amortization | | Outstanding | |
| | | | | |
1st Qtr. 2005 | | — | | $ | 142,132 | |
2nd | | $ | 9,894 | | 132,238 | |
3rd | | 6,268 | | 125,970 | |
4th | | 7,783 | | 118,187 | |
| | | | | |
2006 | | 27,245 | | 90,942 | |
2007 | | 17,800 | | 73,142 | |
2008 | | 16,976 | | 56,166 | |
2009 | | 16,525 | | 39,641 | |
| | | | | |
2010-2014 | | 31,267 | | 8,374 | |
2015-2019 | | 4,663 | | 3,711 | |
2020-2024 | | 1,221 | | 2,490 | |
2025+ | | 2,490 | | — | |
Total | | $ | 142,132 | | | |
| | | | | | | |
Net Premiums
| | | | Scheduled GAAP Premium Earnings | |
| | GAAP
Unearned
Premiums | | From
Unearned
Premium
Amortization | | From
Installments | | Total | |
| | | | | | | | | |
1st Qtr. 2005 | | $ | 91.9 | | — | | — | | — | |
2nd | | 68.3 | | $ | 23.6 | | $ | 27.8 | | $ | 51.1 | |
3rd | | 63.9 | | 4.4 | | 43.9 | | 48.3 | |
4th | | 60.6 | | 3.3 | | 48.4 | | 51.7 | |
| | | | | | | | | |
2006 | | 49.6 | | 11.0 | | 149.7 | | 160.7 | |
2007 | | 40.1 | | 9.5 | | 101.9 | | 111.4 | |
2008 | | 31.9 | | 8.2 | | 77.4 | | 85.6 | |
2009 | | 25.1 | | 6.8 | | 64.1 | | 70.9 | |
| | | | | | | | | |
2010-2014 | | 8.3 | | 16.8 | | 120.6 | | 137.4 | |
2015-2019 | | 4.6 | | 3.7 | | 36.8 | | 40.5 | |
2020-2024 | | 2.4 | | 2.2 | | 25.0 | | 27.2 | |
2025 + | | — | | 2.4 | | 30.5 | | 32.9 | |
Total | | | | $ | 91.9 | | $ | 726.1 | | $ | 818.0 | |
| | | | | | | | | | | | | |
(1) Amounts are presented based on statutory insurance companies of FSA and therefore include amounts relating to insured GICs issued by affiliated GIC companies.
Financial Security Assurance Inc.
Municipal Net Debt Service and Net Premiums
Amortization and Ending Balances
(dollars in millions)
Net Debt Service
| | Scheduled
Amortization | | Outstanding | |
| | | | | |
1st Qtr. 2005 | | — | | $ | 321,618 | |
2nd | | $ | 4,220 | | 317,398 | |
3rd | | 4,559 | | 312,839 | |
4th | | 4,310 | | 308,529 | |
| | | | | |
2006 | | 17,059 | | 291,470 | |
2007 | | 17,366 | | 274,104 | |
2008 | | 17,447 | | 256,657 | |
2009 | | 17,071 | | 239,586 | |
| | | | | |
2010-2014 | | 82,272 | | 157,314 | |
2015-2019 | | 65,976 | | 91,338 | |
2020-2024 | | 46,784 | | 44,554 | |
2025+ | | 44,554 | | — | |
Total | | $ | 321,618 | | | |
| | | | | | | |
Net Premiums
| | | | Scheduled GAAP Premium Earnings | |
| | GAAP
Unearned
Premiums | | From
Unearned
Premium
Amortization | | From
Installments | | Total | |
| | | | | | | | | |
1st Qtr. 2005 | | $ | 1,264.7 | | — | | — | | — | |
2nd | | 1,231.1 | | $ | 33.6 | | $ | 0.6 | | $ | 34.2 | |
3rd | | 1,200.4 | | 30.7 | | 2.3 | | 33.0 | |
4th | | 1,171.2 | | 29.2 | | 2.9 | | 32.1 | |
| | | | | | | | | |
2006 | | 1,061.5 | | 109.7 | | 12.6 | | 122.3 | |
2007 | | 961.0 | | 100.5 | | 12.1 | | 112.6 | |
2008 | | 868.3 | | 92.7 | | 11.8 | | 104.5 | |
2009 | | 782.7 | | 85.6 | | 11.5 | | 97.1 | |
| | | | | | | | | |
2010-2014 | | 445.9 | | 336.8 | | 51.8 | | 388.6 | |
2015-2019 | | 225.8 | | 220.1 | | 41.2 | | 261.3 | |
2020-2024 | | 97.6 | | 128.2 | | 26.9 | | 155.1 | |
2025+ | | — | | 97.6 | | 24.4 | | 122.0 | |
| | | | | | | | | |
Total | | | | $ | 1,264.7 | | $ | 198.1 | | $ | 1,462.8 | |
| | | | | | | | | | | | | |
Corporate Headquarters |
| |
| Financial Security Assurance Holdings Ltd. |
| 350 Park Avenue |
| New York, New York 10022 |
| (1)(212) 826-0100 |
| |
Investor Relations Contact |
| |
| Robert S. Tucker |
| Managing Director |
| (1)(212) 339-0861 |
| rtucker@fsa.com |
| |
Corporate Communications Contact |
| |
| Betsy Castenir |
| Managing Director |
| (1)(212) 339-3424 |
| bcastenir@fsa.com |
| |
Internet | |
| |
| This Quarterly Operating Supplement and other information are available on the World Wide Web at www.fsa.com. |
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
Quarterly Operating Supplement
March 31, 2005
