Assured Guaranty Ltd. Issues Statement In Response to Announcement of Ratings Review for Possible Downgrade by Moody's Investors Service

Business Wire, July 22, 2008

Announces Second Quarter 2008 Net Income Estimate of $5.63 to $6.18 per Diluted Share; Operating Income Estimated at $0.42 per Diluted Share

HAMILTON, Bermuda -- Assured Guaranty Ltd. (NYSE: AGO) ("Assured" or "the Company") today issued a statement in response to the announcement by Moody's Investors Service ("Moody's") that Moody's has placed under review for possible downgrade the Aaa insurance financial strength ratings of Assured Guaranty Corp., the Company's principal direct financial guaranty insurance subsidiary, and Assured Guaranty (UK) Ltd., its U.K. subsidiary, as well as the Aa2 insurance financial strength ratings of Assured Guaranty Re Ltd. ("AG Re"), the Company's Bermuda-based financial guaranty reinsurance subsidiary. Moody's review also includes the Aa3 senior unsecured rating of Assured Guaranty US Holdings Inc. and the Aa3 issuer rating of Assured Guaranty Ltd.

The Company has scheduled a conference call to discuss this announcement for 8:30 a.m. Eastern Time (9:30 a.m. Atlantic Time) on Tuesday, July 22, 2008. The conference will be available by dialing 866-825-3209 (in the U.S.) or 617-213-8061 (International), passcode 80019821. A replay will be available until July 29, 2008. To listen to the replay dial: 888-286-8010 (in the U.S.) or 617-801-6888 (International), passcode 68658510.

Statement by Dominic Frederico, President and Chief Executive Officer of Assured Guaranty Ltd.:

"We are concerned by Moody's announcement at a time when Assured is experiencing broad market acceptance and investor demand for our insured paper," stated Dominic Frederico, President and Chief Executive Officer of Assured Guaranty Ltd. "We believe it is important for investors to know that Moody's action is not at all reflective of a deterioration in Assured's capital base, credit exposures or earnings outlook. I would draw your attention to the following comments Moody's made today in their press release," continued Mr. Frederico. "First, their revised assessment of stress-case loss estimates on our residential mortgage-backed securities portfolio did not change meaningfully from their prior estimates. Second, Assured Guaranty Corp. and AG Re continue to exceed Moody's current capital requirements for their current ratings of Aaa and Aa2, respectively. In addition, in relation to the $40 billion of our pooled corporate exposures Moody's referenced, I would note that 95% of the portfolio is rated by Moody's and 84% is currently rated Aaa by them."

"We are hopeful that investors will focus on the fundamental credit strength of our Company," commented Mr. Frederico. "It is our view, however, that Moody's decision to reevaluate industry ratings during a time of unusually high market volatility and lack of liquidity in many credit markets could have been accomplished in a different manner without affecting municipal and other policyholders. Reflective of our current market position, we are also in negotiations to assume via reinsurance large portfolios of principally municipal risk into AG Re. We believe the cedents and their policyholders, as well as Assured, should materially benefit from these transactions. In light of the announcement by Moody's, we do not know when or if these reinsurance opportunities will be realized," concluded Mr. Frederico. "We are confident in Assured's financial strength and are committed to maintaining our ratings and will work closely with Moody's in their current review."

Assured also announced today that it expects to report net income for the quarter ended June 30, 2008 in the range of $515 million to $565 million, or $5.63 to $6.18 per diluted share, largely due to after tax unrealized gains on credit derivatives, which are expected to be in the range of $475 million to $525 million. Operating income, a non-GAAP financial measure, is estimated at $38.7 million, or $0.42 per diluted share. Net income, operating income and the Company's estimate of loss expenses could change based on new information the Company receives from reinsurance clients or if the Company's management revises loss estimates on specific credits prior to the filing of the Company's second quarter 2008 financial Quarterly Report on Form 10-Q, which is expected to be filed by August 11, 2008.

The Company's after tax unrealized gains on credit derivatives in the quarter reflects an increase in the fair value of financial guaranty contracts written in credit default swap ("CDS") form by the Company's financial guaranty direct and reinsurance segments. The Company's credit derivatives are generally held to maturity and management expects that the unrealized gain or loss on a credit derivative will reduce to zero as the exposure approaches its maturity date, unless there is a payment default on the exposure. The Company determines the fair value of its financial guaranty contracts written in CDS form based on a combination of observable market data and valuation models, using various market indices, credit spreads and estimated contractual payments. The fair value of its financial guaranty contracts written in CDS form also reflects the change in the Company's own credit cost based on the price to purchase credit protection on Assured Guaranty Corp., the Company's financial guaranty direct subsidiary. Assured's current estimate of after tax unrealized gains on derivatives of $475 million to $525 million includes a gain of approximately $675 million after tax (approximately $958 million before tax) associated with the change in Assured Guaranty Corp.'s CDS spread, which widened substantially during June. See explanation of "Non-GAAP Financial Measures" section of this press release for definition of non-GAAP financial measures referenced in this press release.