Assured Guaranty Renews Motion to Lift Automatic Stay and Commence an Action Against PREPA for the Appointment of a Receiver
HAMILTON, Bermuda--(BUSINESS WIRE)--Oct 4, 2018--Assured Guaranty Ltd. (NYSE:AGO) released the following comments regarding a new motion and form of complaint filed in Federal District Court in Puerto Rico today by two of its bond insurance subsidiaries, Assured Guaranty Municipal Corp. (AGM) and Assured Guaranty Corp. (AGC and, together with AGM, Assured Guaranty), as well as National Public Finance Guarantee Corporation and Syncora Guarantee Inc.
Consistent with the United States Court of Appeals for the First Circuit’s remand decision issued August 8, 2018 with respect to a prior lift stay motion, the motion and form of complaint seek an order lifting the automatic stay to allow Assured Guaranty to seek relief before a court of competent jurisdiction, by filing the proposed complaint, to appoint a receiver for the Puerto Rico Electric Power Authority (PREPA).
For decades, PREPA has been crippled by mismanagement, politicization and poor performance. Due to these actions, PREPA is failing to fulfill its obligations to all of Puerto Rico’s stakeholders, including its ratepayers and creditors. As a result of PREPA’s defaults, Assured Guaranty and the other parties are entitled to the appointment of a receiver for PREPA under Puerto Rico law and PREPA’s bond documents. This entitlement to a receiver is automatic once PREPA’s bonds default. Lifting the automatic stay and appointing a receiver for PREPA is necessary to ensure the collateral package securing PREPA’s bonds is not diminished, to foster operational reform by replacing PREPA’s management and to depoliticize PREPA’s key decision-making. Despite filing the motion, Assured Guaranty stands ready, and would prefer, to work cooperatively with the Financial Oversight and Management Board for Puerto Rico to consensually appoint a receiver for PREPA.
Irrespective of PREPA’s payment defaults on its bonds and its Title III bankruptcy filing, payments to holders of PREPA bonds insured by Assured Guaranty will continue to be paid without interruption for the life of the bonds. Assured Guaranty unconditionally and irrevocably guarantees full and timely payment of scheduled debt service, in accordance with the terms of Assured Guaranty’s insurance policies, and upon payment, takes over the rights of the insured bondholders. Assured Guaranty is determined to take reasonable and necessary actions to protect its rights as insurer of PREPA bonds.
With $12 billion* in claims-paying resources across its group of companies, which includes an $11 billion investment portfolio that alone generates approximately $400 million of annual investment income each year, the liquidity and capital positions of AGL and its subsidiaries are very strong.
*Aggregate data for insurance subsidiaries within the Assured Guaranty Ltd. (AGL) group. Claims on each insurance subsidiary’s guarantees are paid from that subsidiary’s separate claims-paying resources. Details in the latest AGL Financial Supplement at assuredguaranty.com/agldata.
About Assured Guaranty
Assured Guaranty helps provide funding for public projects such as the construction of hospitals, schools, roads and bridges in Puerto Rico and in cities and communities across America with the goal of helping municipal governments gain access to funding for essential public projects at affordable interest rates.
Assured Guaranty Ltd. is a publicly traded (NYSE: AGO) Bermuda-based holding company. Its insurance 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.
The information set out above contains forward-looking statements that 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 these statements. These risks and uncertainties include, but are not limited to, those resulting from Assured Guaranty’s inability to execute its strategies, including its loss mitigation and risk remediation strategies, and negative developments that may impact Assured Guaranty’s liquidity and capital, and 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 October 4, 2018. 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.
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CONTACT: Assured Guaranty Ltd.
Robert Tucker, 212-339-0861
Senior Managing Director, Investor Relations and Corporate Communications
Ashweeta Durani, 212-408-6042
Vice President, Corporate Communications
KEYWORD: UNITED STATES BERMUDA NORTH AMERICA CARIBBEAN PUERTO RICO NEW YORK
INDUSTRY KEYWORD: PROFESSIONAL SERVICES BANKING FINANCE INSURANCE
SOURCE: Assured Guaranty Ltd.
Copyright Business Wire 2018.
PUB: 10/04/2018 06:20 AM/DISC: 10/04/2018 06:20 AM