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Item 7. Management’s Discussion and Analysis

2026-02-27 compared with 2025-02-28 · 522 added, 390 removed, 1078 unchanged (46% of the section changed)

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Discussion related to the results of operations for the Company’s comparison of 2024 results to 2023 results have been omitted in this Form 10-K.

The Company’s comparison of 2023 results to 2022 results is included in the Company’s A nnual Report on Form 10-K for the fiscal year ended December 31, 2023 , under Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The Company’s comparison of 2024 results to 2023 results is included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024 , under Part II, Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The Company reports its results of operations in two distinct segments, Insurance and Asset Management, consistent with the manner in which the Company’s chief operating decision maker reviews the business to assess performance and allocate resources.

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The Company participates in the asset management business through its ownership interest in Sound Point.

Business, Asset Management, and Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation.

See Part I, Item 1.

Business – Asset Management, and Item 8.

Financial Statements and Supplementary Data, Note 1.

Business and Basis of Presentation.

The Corporate division primarily consists of the results of holding companies that have issued public equity or debt.

The Other category in the segment tables below primarily includes the effect of consolidating FG VIEs and CIVs (FG VIE and CIV consolidation).

See Item 8, Financial Statements and Supplementary Data, Note 2, Segment Information.

The Other category primarily includes the effect of consolidating FG VIEs and CIVs (FG VIE and CIV consolidation).

Financial Statements and Supplementary Data, Note 2.

Segment Information.

Financial Strength Ratings

Demand for the financial guaranties issued by the Company’s financial guaranty insurance subsidiaries may be impacted by changes in the credit ratings assigned to them by the rating agencies.

The financial strength ratings (or similar ratings) assigned to AGL’s financial guaranty insurance subsidiaries, along with the date of the most recent rating action (or confirmation) by the rating agency assigning the rating, are shown in the table below.

S&P KBRA Moody’s A.M.

Best Company,

AG AA (stable) (6/30/25) AA+ (stable) (8/4/25) A1 (stable) (7/10/24) —

AG Re AA (stable) (6/30/25) — — —

AGRO AA (stable) (6/30/25) — — A+ (stable) (7/19/25)

AGUK AA (stable) (6/30/25) AA+ (stable) (8/4/25) A1 (stable) (7/10/24) —

AGE AA (stable) (6/30/25) AA+ (stable) (8/4/25) — —

In addition, the Company’s life and annuity reinsurance subsidiary, Assured Life Re, is rated BBB (Outlook Positive) (1/28/26) by Fitch Ratings, Inc.

Ratings are subject to continuous rating agency review and revision or withdrawal at any time.

In addition, the Company periodically assesses the value of each rating assigned to each of its companies, and as a result of such assessment may request that a rating agency add or drop a rating from certain of its companies.

There can be no assurance that any of the rating agencies will not take negative action on the financial strength ratings (or similar ratings) of AGL’s insurance

subsidiaries in the future or cease to rate one or more of AGL’s insurance subsidiaries, either voluntarily or at the request of that subsidiary.

For a discussion of the effects of rating actions on the Company beyond potential effects on the demand for its insurance products, see Part I, Item 1A.

Risk Factors – Strategic Risks captioned “A downgrade of the financial strength or financial enhancement ratings of any of the Company’s insurance or reinsurance subsidiaries may adversely affect its business prospects.”

Economic Environment

Real gross domestic product (GDP) increased 2.8% in 2024, compared to an increase of 2.9% in 2023, according to the second estimate released by the U.S.

On April 2, 2025, the U.S.

administration announced a “reciprocal tariff” strategy under the authority of the International Emergency Economic Powers Act (IEEPA) entailing extensive global tariff increases, with the objective of rectifying trade practices that contribute to large and persistent annual U.S.

goods trade deficits.

The announcement of global tariffs disrupted international trade, sent shocks through the global economy, and heightened volatility in the financial markets.

subsequently postponed newly announced reciprocal tariffs, which took effect on August 7, 2025.

On August 29, 2025, the U.S.

Court of Appeals for the Federal Circuit ruled that the U.S.

administration had exceeded its authority under the IEEPA but permitted the tariffs to remain in effect to provide time for the government to appeal.

Supreme Court granted certiorari on September 9, 2025, and heard oral arguments on the case on November 5, 2025;

on February 20, 2026 the U.S.

Supreme Court held that the IEEPA does not authorize the President of the United States to impose tariffs.

administration has indicated that tariffs found to be illegal by the U.S.

Supreme Court will be replaced with alternative import taxes as uncertainty remains.

tariffs can add to inflation, and the Company believes that ongoing uncertainty may increase volatility in U.S.

equities and other risk assets, curb corporate capital and consumer spending and raise the risk of recession.

Market volatility and the risk of recession may impact the Company in different ways.

The Company believes that a recession may make it more likely that obligors whose obligations it guarantees will default.

However, market volatility may also cause credit spreads to widen as investors seek security, which tends to create new business opportunities for the Company.

Real gross domestic product (GDP) increased 2.2% in 2025, compared to an increase of 2.8% in 2024, according to the advance estimate released by the U.S.

Bureau of Economic Analysis (BEA).

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Office for National Statistics, the Consumer Prices Index including owner occupiers’ housing costs rose 3.6% for the 12 months through December 2025, as compared to 3.5% for the 12 months through December 2024.

The Company believes that higher inflation may put pressure on the budgets of obligors whose obligations it guarantees and make defaults more likely.

Generally, inflation reduces the real value of money over time.

For obligors whose payments the Company insures, inflation can mean that the real value of their fixed debt payments decreases, potentially making it relatively easier for obligors to service these fixed-rate debts and less likely for them to default.

However, if inflation increases operating expenses and revenues or incomes do not keep pace, obligors may find it more difficult to make their payment obligations, even if nominal debt payments remain unchanged.

Higher inflation can also lead to tighter monetary policies, which are actions taken by sovereign central banks to reduce the amount of money circulating in the economy, including raising interest rates, which can make refinancing or servicing debt more difficult.

In addition, consumer price inflation in the U.K.

increases reported net par outstanding for certain U.K.

exposures with approximately $23.2 billion of net par outstanding as of December 31, 2024, and also increases projected future installment premiums on the portion of such exposure that pays at least a portion of the premium on an installment basis over the term of the exposure.

affects reported net par outstanding for certain U.K.

exposures with $24.5 billion of net par outstanding as of December 31, 2025, and also affects projected future installment premiums on the portion of such exposure that pays at least a portion of the premium on an installment basis over the term of the exposure.

At its September 2024 meeting, the Federal Open Market Committee (FOMC) decided to lower the federal funds rate, which was a reversal of the rate increases it had initiated in March 2022 to combat inflation.

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From September 2024 through December 2025, the FOMC lowered the federal funds rate from a target range of 5.25% to 5.50% to a range of 3.50% to 3.75%.

At its January 28-29, 2025 meeting, the FOMC held the federal funds at a range of 4.25% to 4.50%, stating

that it seeks to achieve maximum employment and inflation at the rate of 2% over the longer run, and that the risks to achieving its employment and inflation goals are roughly in balance.

Most recently, at its January 2026 meeting, the FOMC held the federal funds rate at a target range of 3.50% to 3.75%, stating that it is strongly committed to supporting maximum employment and returning inflation to its 2% objective.

In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the FOMC has indicated it will carefully assess incoming data, the evolving outlook, and the balance of risks.

These assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

From 2022 through February 2026, the Bank of England’s Monetary Policy Committee (MPC) took actions similar to those of the FOMC to combat inflation and spur economic growth.

In 2022, the MPC raised the Bank of England base rate (Bank Rate) from historic lows in response to surging inflation, increasing the rate multiple times into 2023 as inflation remained high above MPC’s 2% target.

By the end of 2023, the MPC signaled a pause in further increases as inflation began to decline and economic growth slowed.

During 2024, as inflationary pressures eased further and the U.K.

economy showed signs of stagnation or mild recession, the MPC kept the rate unchanged for most of the year, before beginning to decrease the Bank Rate in August 2024.

In 2025 and early 2026, with inflation being closer to the MPC’s target level and economic growth slowed, the MPC further lowered the Bank Rate several times, standing at 3.75% as of February 5, 2026, aiming to support economic growth while maintaining price stability.

The level and direction of change of interest rates and credit spreads impact the Company in numerous ways.

On the one hand, lower interest rates may increase the fair value of fixed-maturity securities currently held in the Company’s investment portfolio, encourage municipal bond issuance and positively impact the finances of some of the obligors whose payments the Company insures.

On the other hand, lower interest rates may decrease the base on which the Company charges up-front premium on most new U.S.

municipal bond transactions and may also decrease amounts the Company can earn on fixed-maturity securities newly acquired for its investment portfolio.

Lower interest rates also are often accompanied by narrower spreads, which may also decrease the level of premiums the Company can charge for those products.

On the one hand, lower interest rates may increase the fair value of fixed-maturity securities currently held in the Company’s investment portfolio, encourage municipal and infrastructure bond issuance and positively impact the finances of some of the obligors whose payments the Company insures.

On the other hand, lower interest rates may decrease the base on which the Company charges up-front premium on most new municipal and infrastructure bond transactions and may also decrease amounts the Company can earn on securities newly acquired for its investment portfolio.

Lower interest rates also are often accompanied by narrower credit spreads, which may also decrease the level of premiums the Company can charge for transactions.

The 30-year AAA Municipal Market Data (MMD) rate is a measure of interest rates in the Company’s largest financial guaranty insurance market, U.S.

public finance.

The MMD rate averaged 3.68% for 2024, similar to the 3.65% rate in 2023 but higher than the 3.00% average for 2022.

Meanwhile, the difference, or credit spread, between the 30-year BBB-rated general obligation relative to the 30-year AAA MMD averaged 90 basis points (bps) in 2024, which is narrower compared to the 101 bps average for 2023, but the same as the 90 bps average for 2022.

The MMD rate averaged 4.30% for 2025, higher than the 3.68% average rate in 2024 and higher than the 3.65% average rate for 2023.

Meanwhile, the difference, or credit spread, between the 30-year BBB rated general obligation relative to the 30-year AAA MMD averaged 89 basis points (bps) in 2025, which is narrower compared to the 90 bps average for 2024 and compared to the 101 bps average for 2023.

The Company believes that wider spreads could permit it to increase its premium rates on new business.

According to Freddie Mac, the 30-year fixed-rate mortgage averaged 6.85% as of December 26, 2024, near the 30-year mortgage rate of 6.61% from one year ago.

The Company believes that restricted housing inventory continues to influence home prices where demand outpaces supply.

According to Freddie Mac, the 30-year fixed-rate mortgage rate averaged 6.15% for the week ending December 31, 2025, lower than the 30-year mortgage rate average of 6.85% from one year ago.

The National Association of Realtors reported that there was a 1.4% increase in year-over-year existing-home sales from December 2024 to December 2025, and that the median existing-home sales price increased 0.4% from December 2024 ($403,700) to December 2025 ($405,400).

Higher housing prices may benefit distressed RMBS the Company insures.

The National Association of Realtors reported that year-over-year existing-home sales increased 9.3% from December 2023 to December 2024, and that the median existing-home sales price also increased from December 2023 ($381,400) to December 2024 ($404,400), a 6.0% increase.

Key Business Strategies

The Company continually evaluates its business strategies and is currently pursuing key business strategies in four areas:

(i) insurance;

(ii) asset management, (iii) alternative investments;

(i) growth of its insurance and asset management businesses;

(ii) loss mitigation;

(iii) enhancement of investment returns through alternative investments;

and (iv) capital management.

The Company seeks to grow the insurance business through new business production in established sectors and jurisdictions and by entering into new markets and classes of business.

The Company also furthers its insurance strategy by mitigating losses in its insured portfolio.

Growth of the Insured Portfolio

Insurance and Asset Management Growth

The Company seeks to grow its core financial guaranty insurance business through new business production in established sectors and jurisdictions and by entering into new markets, lines and classes of business.

In addition, the Company seeks to leverage its core credit competencies by expanding its business into revenue streams independent of its financial guaranty insurance business, such as annuity reinsurance through its life and annuity reinsurance platform and its asset management business, with the objective of bolstering net income growth and predictability and generating high-return business opportunities.

Financial Guaranty Insurance Portfolio

The Company seeks to grow its financial guaranty insurance portfolio through new business production in each of its markets:

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The Company believes that, over time, wider credit spreads may improve demand for bond insurance.

In certain segments of the infrastructure and structured finance markets, the Company believes its financial guaranty product is competitive with other financing options.

For example, certain investors may receive advantageous capital requirement treatment with the addition of the Company’s guaranty.

In certain segments of the non-U.S.

infrastructure and global structured finance markets, the Company believes its financial guaranty product is competitive with other financing options.

In the infrastructure market, the Company’s financial guaranty can enhance the insured obligation’s rating, lower the cost of long-term funding and enhance the liquidity and transferability of debt obligations.

Certain investors may receive advantageous capital requirement treatment with the addition of the Company’s financial guaranty.

The Company considers its involvement in both infrastructure and structured finance transactions to be beneficial because such transactions diversify both the Company’s business opportunities and its risk profile beyond U.S.

public finance.

The timing of new business production in the infrastructure and structured finance sectors is influenced by typically long lead times and therefore may vary from period to period.

The timing of new business production in the infrastructure and structured finance sectors is influenced by typically long lead times and therefore production may vary from period to period.

Municipal Market Data and Bond Insurance Penetration Rates (1)

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The table excludes private placements and Corporate-CUSIP transactions insured by Assured Guaranty, certain of which the Company also considers to be public finance business.

The Company also considers opportunities to acquire financial guaranty portfolios, whether by acquiring financial guarantors that are no longer actively writing new business or their insured portfolios, generally through reinsurance or novations.

In addition, the Company considers opportunities to acquire financial guaranty portfolios, whether by acquiring financial guarantors that are no longer actively writing new business or their insured portfolios, generally through reinsurance or novations.

These transactions enable the Company to improve its future earnings and deploy excess capital.

Merger of the U.S.

Insurance Subsidiaries

On August 1, 2024, AGM merged with and into AG, with AG as the surviving company.

Upon the merger all liabilities of AGM, including insurance policies issued or assumed by AGM, became obligations of AG.

The Company believes that Assured Guaranty’s simplified organizational and capital structure following the merger will help it grow its business.

The combined company, as compared with either AG or AGM before the merger, has a larger, more highly diversified insured portfolio, a larger investment portfolio and a larger capital base, creating a more efficient capital structure and greater claims-paying resources.

In addition, the combined company, as compared with either AG or AGM before the merger, has larger regulatory single risk limits.

Such limits are applicable to each individual financial guaranty insurer for obligations issued by a single entity and backed by a single revenue source.

Since the combined company has greater policyholder’s surplus and contingency reserves, as compared to standalone AG or AGM before the merger, the dollar amounts for its single risk limits on obligations issued by a single entity and backed by a single revenue source are also greater.

Prior to the merger, AG had been directly owned by AGUS.

As a result of the merger, effective as of August 1, 2024, AG is directly owned by AGMH, a subsidiary of AGUS.

The Company seeks to expand its financial guaranty business geographically by entering new markets;

in 2024, the Company opened new offices in Australia and Singapore.

The Company has recently undertaken, and continues to undertake, several initiatives to broaden its insurance lines and classes of business, and improve the efficiency of its secondary market execution.

For example, the Company has enhanced its structured finance new business production by developing fund finance into a flow business line.

In addition, the Company is pursuing nonpayment insurance business strategies through internal and/or external growth opportunities.

Life and Annuity Reinsurance

On January 21, 2026, the Company purchased all of the outstanding share capital in Warwick Company (UK) Limited (which is the 100% indirect owner of Assured Life Reinsurance Ltd.

(Assured Life Re, f/k/a Warwick Re Limited), for a purchase price of $158 million, subject to certain post-closing adjustments (Assured Life Re Acquisition).

Assured Life Re is a Class E long-term (life) reinsurance company incorporated and registered in Bermuda and is rated BBB (Outlook Positive) (1/28/26) by Fitch Ratings, Inc.

Assured Life Re focuses on annuity reinsurance including U.K.

bulk purchase annuity (pension risk transfers) and U.S.

multi-year guaranteed annuity transactions.

The Company believes that the acquisition of the Assured Life Re platform will provide it with life and annuity business opportunities that complement its financial guaranty and asset management businesses, are consistent with its risk profile and benefit from its core competencies, including credit enhancement.

The Assured Life Re Acquisition represents the Company’s first platform dedicated solely to the life and annuity reinsurance business.

See Part I, Item 1A.

Risk Factors – Strategic Risks, captioned “The Assured Life Re Acquisition may negatively impact the Company, including how it is perceived by its investors, regulators, rating agencies or obligors it insures, as well as Assured Life Re’s business relationships,” “Entering the life and annuity reinsurance business may present integration risks and other risks specific to the life and annuity reinsurance business that could have a negative effect on the Company’s business, results of operations or financial condition,” “Strategic transactions may not result in the benefits anticipated” and “The Company makes assumptions when pricing its life and annuity reinsurance products relating to longevity, mortality, policy lapses, withdrawals, surrenders, investment returns and expenses, and significant deviations in experience could negatively affect the Company’s financial condition and results of operations.”

The Company continues to investigate additional opportunities in the life and annuity reinsurance business and in other businesses in line with its risk profile and that would benefit from its core competencies.

Asset Management

The Company participates in the asset management business through its ownership interest in Sound Point, and does not directly manage investments for third parties.

The Company’s ownership interest in Sound Point furthers its growth strategy of participating in a diversifying fee-based earnings stream independent of the risk-based premiums generated by its financial guaranty business.

In addition to its ownership interest in Sound Point, the Company also has in place a letter agreement (Letter Agreement) with Sound Point relating to the Company’s alternative investments portfolio which supports other key strategic initiatives.

See “Enhancement of Investment Returns Through Alternative Investments” below.

Financial Statements and Supplementary Data, Note 1.

Business and Basis of Presentation and Note 7.

Investments and Cash, for a description of the Company’s participation in the asset management business through its ownership interest in Sound Point.

Loss Mitigation

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This has been illustrated by the Company’s role in negotiating various agreements in connection with the restructuring of obligations of the Commonwealth of Puerto Rico and various obligations of its related authorities and public corporations, as well as Detroit, Michigan and Stockton, California.

The Company will also, where appropriate, participate in litigation to enforce or defend its rights.

For public finance credits, the Company’s surveillance function monitors and proactively engages with the distressed credits to offer assistance aimed to improve operations and financial performance, including access to external consultants and other industry experts.

The Company also, from time to time and where appropriate, participates in litigation to enforce or defend its rights.

For example, the Company initiated a number of legal actions to enforce its rights with respect to obligations of the Commonwealth of Puerto Rico and various obligations of its related authorities and public corporations.

In addition, the Company successfully defended claims brought by Lehman Brothers International (Europe) (in administration) (LBIE) and prevailed in its counterclaim against LBIE;

following the exhaustion of LBIE’s appeals, the Company will recognize a gain in the first quarter of 2025 of approximately $103 million, which represents the full satisfaction of the judgment it was awarded and its claims for attorneys’ fees, expenses and interest in connection with this litigation.

See, Item 8, Financial Statements and Supplementary Data, Note 17, Contingencies, Litigation, for additional information.

following the exhaustion of LBIE’s appeals, the Company recognized a realized gain on credit derivatives in the first quarter of 2025 of $103 million, which represents the full satisfaction of the judgment it was awarded and its claims for attorneys’ fees, expenses and interest in connection with this litigation.

Financial Statements and Supplementary Data, Note 17.

Contingencies, Litigation, for additional information.

The Company may also purchase Loss Mitigation Securities in order to mitigate the economic effect of insured losses.

The fair value of Loss Mitigation Securities as of December 31, 2025 (excluding the value of the Company’s insurance) was $140 million.

In July 2025, the Company’s largest BIG exposure in the investment portfolio, which was obtained as part of a loss mitigation strategy, with an aggregate carrying value of $408 million as of June 30, 2025, reached its final resolution after many years of negotiation and was paid down after liquidation of the trust assets.

The Company received $459 million in connection with this resolution, including principal, accrued interest and other expected recoveries.

This resolution did not have a significant effect on the consolidated statements of operations.

Also, in connection with the sale in October 2025 of a commercially leased building that was part of a loss mitigation strategy for a troubled insured exposure, the Company recognized a pre-tax gain of $23 million in the fourth quarter of 2025, and realized a positive inception-to-date internal rate of return on the insured exposure.

The Company is, and for several years has been, working with the servicers of some of the U.S.

RMBS transactions it insures to encourage the servicers to provide alternatives to distressed borrowers that will encourage them to continue making payments on their loans to help improve the performance of the related RMBS.

The Company may also purchase attractively priced obligations, including BIG obligations, that it has insured and for which it had expected losses to be paid, in order to mitigate the economic effect of insured losses (Loss Mitigation Securities).

The fair value of Loss Mitigation Securities as of December 31, 2024 (excluding the value of the Company’s insurance) was $479 million.

In some instances, the terms of the Company’s policy or the terms of certain workout orders and resolutions give it the option to pay principal on an accelerated basis on an obligation on which it has paid a claim, thereby reducing the amount of guaranteed interest due in the future.

In some instances, the terms of the Company’s financial guaranty policies or the terms of certain workout orders and resolutions give it the option to pay principal on an accelerated basis on an obligation on which it has paid a claim, thereby reducing the amount of guaranteed interest due in the future.

The Company has at times exercised this option, which uses cash but reduces projected future losses.

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Refunding bonds may provide the issuer with payment relief.

Asset Management

Until July 1, 2023, the Company pursued its asset management strategy through AssuredIM.

Upon the closing of the transaction with Sound Point (Sound Point Transaction) and the AHP Transaction, effective as of July 1, 2023, the Company participates in the asset management business through its ownership interest in Sound Point, and no longer directly manages investments for third parties.

The Company’s ownership interest in Sound Point furthers its strategy of participating in a fee-based earnings stream independent of the risk-based premiums generated by its financial guaranty business.

The Sound Point business was strengthened by the addition of AssuredIM’s AUM (excluding AUM relating to AHP).

See Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation, for a description of the Sound Point Transaction and the AHP Transaction.

Alternative Investments

Enhancement of Investment Returns Through Alternative Investments

The Company seeks to maintain an investment portfolio that supports the requirements of its insurance subsidiaries, strategic initiatives and liquidity needs, while maximizing the income it earns from such investments.

In support of that goal, the Company aims to diversify the types of investments in its portfolio.

The Company expects its relationship with Sound Point to also enhance its alternative investment opportunities and the return on its investments.

The Company has agreed to invest an aggregate amount of $1.5 billion in alternative investments, including $1 billion in Sound Point managed investments.

The Company expects its relationship with Sound Point to enhance its alternative investment opportunities and the return on its investments.

The Company has agreed to invest an aggregate amount of $1.5 billion in alternative investments, which includes $1 billion in Sound Point managed investments, subject to certain conditions precedent.

Financial Statements and Supplementary Data, Note 7.

Investments and Cash, for a description of the alternative investments agreement with Sound Point.

Capital Management

The Company has developed strategies to efficiently manage capital within the Assured Guaranty group.

From 2013 through February 27, 2025, the Company has repurchased 151 million common shares for approximately $5.4 billion, representing approximately 78% of the total shares outstanding at the beginning of the repurchase program in 2013.

On May 2, 2024 and November 8, 2024, the AGL Board of Directors (the Board) authorized the repurchase of an additional $300 million and $250 million, respectively, of the Company’s common shares.

Under this and previous authorizations, as of February 27, 2025, the remaining amount the Company was authorized to purchase was approximately $276 million of its common shares.

The Company’s capital management strategy is designed to efficiently allocate and utilize capital across the Assured Guaranty group in order to optimize outcomes for rating agency assessments, regulatory compliance and the Company’s own strategic initiatives and risk management requirements.

The Company believes this disciplined approach to capital management supports the long-term stability and strength of Assured Guaranty, enabling it to advance its financial guaranty, asset management and annuity reinsurance businesses, and other corporate strategies.

Assured Guaranty seeks to enhance financial flexibility and resiliency by proactively managing its capital and aligning resources with its business objectives and stakeholder interests.

From 2013 through February 25, 2026, the Company has repurchased 157 million common shares for $5.9 billion, representing 81% of the total shares outstanding at the beginning of the repurchase program in 2013.

On August 6, 2025 and November 5, 2025, the Board authorized the repurchase of an additional $300 million and $100 million, respectively, of the Company’s common shares.

As of February 25, 2026, the remaining amount the Company was authorized to purchase was $204 million of its common shares.

Shares may be repurchased from time to time in the open market or in privately negotiated transactions.

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The repurchase program may be modified, extended or terminated by the Board at any time and it does not have an expiration date.

See Item 8, Financial Statements and Supplementary Data, Note 18, Shareholders’ Equity, for additional information about the Company’s repurchases of its common shares.

Financial Statements and Supplementary Data, Note 18.

Shareholders’ Equity, for additional information about the Company’s repurchases of its common shares.

Summary of Share Repurchases

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____________________

(1) Excludes commissions and excise taxes.

(1) Excludes commissions.

As of December 31, 2025, the estimated accretive effect of the cumulative repurchases of common shares since the beginning of 2013 was approximately:

$54.83 per share in shareholders’ equity attributable to AGL, $59.27 per share in adjusted operating shareholders’ equity, and $100.61 per share in adjusted book value.

In May 2024, the NYDFS approved, and AGM implemented, the redemption of approximately $100 million of AGM’s shares of common stock from AGMH.

In connection with the merger of AGM into AG, the MIA approved, and in the third quarter of 2024 AG implemented, the redemption of approximately $300 million of AG’s shares of common stock from AGMH in exchange for cash of $167 million and the remainder in alternative investments.

$68.77 per share in shareholders’ equity attributable to AGL, $69.94 per share in adjusted operating shareholders’ equity and $116.18 per share in adjusted book value (ABV).

Over the last several years, the Company has received approval from its insurance regulators to redeem a portion of its insurance subsidiaries’ stock and pay extraordinary dividends from its insurance subsidiaries.

Most recently, in the third quarter of 2025, after receiving approval from the MIA, AG redeemed $250 million of its common stock from AGMH in exchange for $213 million in cash and $37 million in alternative investments.

The Company considers the appropriate mix of debt and equity in its capital structure.

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The primary drivers of volatility in the Company’s net income include:

loss and loss adjustment expense (LAE), changes in fair value of credit derivatives, FG VIEs, CIVs, trading securities and CCS, as well as foreign exchange gains (losses), the level of refundings of insured obligations, changes in the value of the Company’s alternative investments, the effects of any large transactions, settlements, commutations and loss mitigation strategies, among other factors.

loss and LAE, changes in fair value of certain alternative investments, credit derivatives, FG VIEs, CIVs, trading securities and CCS, as well as foreign exchange gains (losses), the level of refundings of insured obligations, the effects of any large transactions, settlements, commutations and loss mitigation strategies, among other factors.

Changes in laws and regulations, among other factors, may also have a significant effect on reported net income or loss in a given reporting period.

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Adjusted operating shareholders’ equity (1) 5,729 126.78 5,795 114.75

Adjusted book value (1) 8,592 170.12 8,765 155.92

ABV (1) 8,424 186.43 8,592 170.12

Common shares outstanding (4) 45.2 50.5

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Interest expense 89 91 90

Amortization of deferred acquisition cost (DAC) 20 13 14

Employee compensation, benefit and other operating expenses:

Asset management subsidiaries 6 91 140

Insurance and other subsidiaries 355 377 285

Amortization of deferred acquisition costs (DAC) 22 20 13

Employee compensation and benefit expenses 209 202 251

Other operating expenses 174 159 217

Total expenses 550 446 733

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Net income (loss) 543 392 761

Noncontrolling interests 16 22 13

Noncontrolling interest (NCI) 40 16 22

Net income (loss) attributable to Assured Guaranty Ltd.

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Effective tax rate 17.9 % 19.7 % (13.9) %

Net income attributable to AGL in 2024 was lower compared with 2023 primarily due to the following:

• the gain associated with the Sound Point Transaction and AHP Transaction, net of transaction expenses, of $175 million (after-tax) in 2023,

• the benefit related to Bermuda tax law changes of $189 million in 2023,

• lower fair value gains on credit derivatives of $24 million in 2024 compared with $114 million in 2023,

• foreign exchange remeasurement losses of $27 million in 2024, compared with gains of $53 million in 2023, and

• lower other income due to the reversal of a previously recorded litigation accrual of $20 million in 2023.

These decreases were partially offset by:

• lower loss and LAE, which was a benefit of $26 million in 2024 compared with a loss of $162 million in 2023,

• a large refunded transaction which was the primary driver of the increase in net earned premiums to $403 million in 2024 from $344 million in 2023, and

• higher equity earnings from the alternative investment portfolio, which was $62 million in 2024 compared with $28 million in 2023.

The Company’s effective tax rate reflects the proportion of income recognized by each of the Company’s operating subsidiaries, with U.S.

subsidiaries generally taxed at the U.S.

Net income attributable to AGL in 2025 was higher compared with 2024 primarily due to the following:

• foreign exchange remeasurement gains of $96 million in 2025, compared with losses of $27 million in 2024,

• a gain on credit derivatives related to the resolution of the LBIE litigation of $103 million in 2025,

• higher other income due to a gain of $23 million recognized in connection with the sale in 2025 of a commercially leased building that was part of a loss mitigation strategy for a troubled insured exposure and $15 million associated with the workout and purchase of bonds issued by a U.K.

regulated utility to which the Company has insured exposure and interest on late financial guaranty premiums,

• higher equity in earnings of investees in 2025, primarily generated by the Company’s investments in Sound Point, healthcare funds and legacy alternative investments, and

• fair value gains on committed capital securities in 2025, compared with losses in 2024.

These increases were partially offset by:

• loss and LAE in 2025 of $56 million, compared with a benefit of $26 million in 2024,

• net realized investment losses in 2025 primarily due to changes in the allowance for credit losses for alternative investments and Loss Mitigation Securities,

• lower fair value gains on trading securities in 2025, and

• lower net earned premiums in 2025, compared with 2024 due to lower refundings of financial guaranty insurance exposures.

The Company’s effective tax rate reflects the proportion of income recognized by each of the Company’s operating subsidiaries in the jurisdiction in which they are taxed, with U.S.

subsidiaries and foreign subsidiaries that have made an election to be a U.S.

taxpayer taxed at the U.S.

marginal corporate income tax rate of 21%, U.K.

subsidiaries taxed at the U.K.

marginal corporate tax rate of 25% for periods starting April 1, 2023, and 19% for periods ending on or before March 31, 2023, and the French subsidiary taxed at the French marginal corporate tax rate of 25%, and Assured Guaranty Re Ltd.

(AG Re) and Cedar Personnel Ltd.

taxed at the Bermuda marginal corporate tax rate of 0%.

Effective January 1, 2024, the U.K.

adopted a global minimum tax rate of 15% under the Organization for Economic Co-Operation and Development’s Base Erosion and Profit Shifting Pillar Two rules.

See Part I, Item 1, Business - Regulation, and Part II, Item 8, Financial Statements and Supplementary Data, Note 13, Income Taxes.

taxed at the Bermuda marginal corporate tax rate of 15% starting January 1, 2025 and 0% for 2024 and 2023.

See Part I, Item 1.

Business – Regulation, and Part II, Item 8.

Financial Statements and Supplementary Data, Note 13.

Income Taxes.

Adjusted Operating Income

Adjusted operating income in 2025 was $445 million, compared with $389 million in 2024.

The decrease was primarily due to the gain associated with the Sound Point Transaction and AHP Transaction and the benefit attributable to Bermuda tax law changes in 2023, offset in part by a benefit in loss expense in 2024 compared with a loss expense in 2023 and higher net earned premiums in 2024.

The increase was primarily due to the gain related to the resolution of the LBIE litigation in 2025, higher equity in earnings of investees and the gain recognized in connection with the sale of a commercially leased building that was part of a loss mitigation strategy for a troubled insured exposure, offset in part by a higher loss expense in public finance sectors, lower fair value gains on the trading portfolio and lower earned premiums on refundings of financial guaranty insurance contracts in 2025.

See “— Results of Operations — Reconciliation to GAAP” for the reconciliation of net income (loss) attributable to AGL to adjusted operating income (loss).

Book Value and Adjusted Book Value

Shareholders’ equity attributable to AGL as of December 31, 2024 decreased compared with December 31, 2023, due to share repurchases of $508 million and dividends of $68 million, offset in part by net income.

Adjusted operating shareholders’ equity and adjusted book value also decreased primarily due to share repurchases and dividends, partially offset by adjusted operating income of $389 million, and in the case of adjusted book value, the increase was also due to GWP of $440 million.

See “— Non-GAAP Financial Measures” below for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders' equity and adjusted book value.

On a per share basis, shareholders’ equity attributable to AGL, adjusted operating shareholders’ equity and adjusted book value increased as of December 31, 2024 compared with December 31, 2023, due in part to the accretive effect of the share repurchase program.

See “— Non-GAAP Financial Measures” for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders' equity and adjusted book value.

Book Value and ABV

Shareholders’ equity attributable to AGL as of December 31, 2025 increased compared with December 31, 2024, primarily due to net income and unrealized gains on the investment portfolio, partially offset by share repurchases and dividends.

Adjusted operating shareholders’ equity and ABV decreased primarily due to share repurchases and dividends, partially offset by adjusted operating income and GWP.

See “— Non-GAAP Financial Measures” below for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders' equity and ABV.

On a per share basis, shareholders’ equity attributable to AGL, adjusted operating shareholders’ equity and ABV increased as of December 31, 2025 compared with December 31, 2024, due, in part, to the accretive effect of the share repurchase program.

See “— Non-GAAP Financial Measures” for the reconciliation of shareholders’ equity attributable to AGL to adjusted operating shareholders' equity and ABV.

Other Matters

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Russia’s invasion of Ukraine has led to the imposition of economic sanctions by many western countries against Russia and certain Russian individuals, dislocation in global energy markets, massive refugee movements and payment default by certain Russian credits.

The economic sanctions imposed by western governments, along with decisions by private companies regarding their presence in Russia, continue to reduce western economic ties to Russia and to reshape global economic and political ties more generally, and the Company cannot predict all of the potential effects of the conflict on the world or on the Company.

economic and political ties more generally, and the Company cannot predict all of the potential effects of the conflict on the world or the Company.

The Company’s surveillance and treasury functions have reviewed the Company’s insurance and investment portfolios, respectively, and have identified no material direct exposure to Ukraine or Russia.

In fact, the Company’s direct

insurance exposure to eastern Europe generally is limited to approximately $214 million in net par outstanding as of December 31, 2024, comprised of $198 million net par exposure to the sovereign debt of Poland and $16 million net par exposure to a toll road in Hungary.

The Company rates all such exposure investment grade.

In fact, the Company’s direct insurance exposure to Eastern Europe generally is limited to $198 million in net par outstanding as of December 31, 2025, comprising of the sovereign debt of Poland.

The Company rates this exposure investment grade.

Middle East Conflict

In light of events in the Middle East, the Company’s surveillance and treasury functions have reviewed the Company’s insurance and investment portfolios, respectively, for exposures to the Middle East.

In light of events in the Middle East that began on October 7, 2023, the Company’s surveillance and treasury functions have reviewed the Company’s insurance and investment portfolios, respectively, for exposures to the Middle East.

After review, the Company’s surveillance and treasury functions have identified no material direct exposure to such area.

The Company’s direct insurance exposure to the Middle East is generally limited to approximately $110 million in net par outstanding as of December 31, 2024, comprised of funded commitments to subscription finance facilities;

however, such exposure may increase to a total of approximately $165 million to the extent all unfunded commitments under the facilities are ultimately funded.

The Company’s direct insurance exposure to the Middle East is generally limited to funded and unfunded commitments to fund finance facilities.

When fund finance facilities are launched, they obtain aggregate commitments across numerous investors in the fund.

For certain facilities guaranteed by the Company, a small minority of investors are domiciled in the Middle East, which are generally sovereign wealth funds and pensions.

Fund finance facilities guaranteed by the Company are always overcollateralized with uncalled capital commitments exceeding borrowings, and defaults of Middle East investors alone cannot cause a loss.

Such facilities have additional mitigants, including the ability to call on performing investors to cover the obligations of defaulting investors and rights to sell defaulting positions to other investors at a discount.

The Company rates all such insurance exposure investment grade.

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In January 2025, a series of destructive wildfires affected Los Angeles, California.

The Company’s surveillance function has reviewed the Company’s insurance portfolio for exposures located within Los Angeles County and has identified no material impact to its exposure located directly within the perimeter of the wildfires.

The Company’s surveillance function has reviewed the Company’s insurance portfolio for exposures located within Los Angeles County and currently has not identified any material impact on the ability of such exposures to pay their obligations.

Operation in Venezuela

On January 3, 2026, the U.S.

executed an operation within Venezuela apprehending President Nicholas Maduro and his wife Cilia Flores who were taken to New York City and indicted in the U.S.

Southern District Court of New York on several charges related to narcoterrorism.

In light of this development, the Company’s surveillance and treasury functions have reviewed the Company’s insurance and investment portfolios, respectively, and have identified no direct exposure to Venezuela.

The Company’s direct insurance exposure to South America is generally limited to $128 million in net par outstanding as of December 31, 2025, comprising of infrastructure finance in Colombia and Chile.

The Company rates these exposures investment grade.

Results of Operations

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There can be no assurance that actual results will conform to estimates and assumptions and that reported results of operations will not be materially different in the future due to changes in these estimates and assumptions.

Listed below are the accounting policies and estimates that the Company believes are most dependent on the application of judgment and assumptions.

See Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation, for the Company’s significant accounting policies which includes a reference to the applicable note where further details regarding the significant estimates and assumptions are provided.

In addition, see Item 7A, Quantitative and Qualitative Disclosures About Market Risk, for further details regarding the sensitivity analyses.

Listed below are the accounting estimates that the Company believes are most dependent on the application of judgment and assumptions.

Financial Statements and Supplementary Data, Note 1.

Business and Basis of Presentation, for the Company’s list of significant accounting policies which includes a reference to the applicable note where further details regarding the significant estimates and assumptions are provided.

In addition, see Item 7A.

Quantitative and Qualitative Disclosures About Market Risk, for further details regarding sensitivity analyses.

• Expected loss to be paid (recovered);

• Fair value of certain assets and liabilities, primarily:

◦ Investments (primarily Loss Mitigation Securities and alternative investments)

• Investments (primarily alternative investments)

• Assets and liabilities of FG VIEs;

◦ Credit derivatives;

• Acquisition date fair value of the equity method ownership interest in Sound Point;

• Impairments of equity method investments and financial instruments;

• Impairments of equity method investments and credit allowances for financial instruments;

• Income tax assets and liabilities, including the recoverability of all deferred tax assets (liabilities) and in particular the Bermuda deferred tax asset recorded in 2023.

Results of Operations by Segment

The Company analyzes the operating performance of each segment using each segment’s adjusted operating income as described in Item 8, Financial Statements and Supplementary Data, Note 2, Segment Information.

The Company analyzes the operating performance of each segment using each segment’s adjusted operating income as described in Item 8.

Financial Statements and Supplementary Data, Note 2.

Segment Information.

Insurance Segment Results

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Net investment income 358 339 370

Fair value gains (losses) on trading securities 52 74 (34)

Foreign exchange gains (losses) on remeasurement 11 (1) 3

Fair value gains (losses) on trading securities 13 52 74

Other income (loss) 53 14 51

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Loss expense (benefit) (8) (18) 161

Interest expense — — 1

Amortization of DAC 22 20 13

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Scheduled net earned premiums decrease each year unless replaced by a higher amount of new business, or books of business acquired in business combinations.

See Item 8, Financial Statements and Supplementary Data, Note 5, Contracts Accounted for as Insurance, Premiums, for additional information.

Financial Statements and Supplementary Data, Note 5.

Contracts Accounted for as Insurance, Premiums, for additional information.

Net earned premiums due to accelerations are attributable to changes in the expected lives of insured obligations driven by:

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The premiums associated with the insured obligations of municipalities and other public finance issuers are generally received upfront when the obligations are issued and insured.

When issuers pay down insured obligations, the Company is no longer on risk for payment defaults, and therefore accelerates the recognition of the remaining nonrefundable deferred premium revenue.

When issuers pay down insured obligations, the Company is no longer on risk for payment defaults, and therefore accelerates

the recognition of any remaining nonrefundable deferred premium revenue.

The amortization of the Company’s outstanding book of business along with the previously high levels of refunding activity and the higher interest rate environment has led to a lower volume of refunding opportunities over the last several years.

Terminations are generally negotiated agreements with beneficiaries resulting in the extinguishment of the Company’s insurance obligation.

Terminations have been more common in the structured finance asset class, but may also occur in the public finance asset class.

Terminations have historically been more common in the structured finance sector, but may also occur in the public finance sector.

While each termination may have different terms, they all result in the expiration of the Company’s insurance risk, the acceleration of the recognition of the associated deferred premium revenue and the reduction of any remaining premiums receivable.

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(1) Includes accretion of discount.

Net earned premiums and credit derivative revenues increased in 2024 compared with 2023 primarily due to a large refunded transaction in the first quarter of 2024.

As of December 31, 2024, $3.7 billion of net deferred premium revenue on financial guaranty insurance remained to be earned over the life of the insurance contracts.

Net earned premiums and credit derivative revenues increased in 2025 compared with 2024 primarily due to credit derivative revenues related to the resolution of the LBIE litigation (see Item 8.

Financial Statements and Supplementary Data, Note 6.

Contracts Accounted for as Credit Derivatives) and earnings on large transactions and supplemental premiums written in 2024, partially offset by lower financial guaranty insurance refundings and terminations.

As of December 31, 2025, $3.6 billion of net deferred premium revenue remained to be earned over the life of the financial guaranty insurance contracts.

New Business Production

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(1) PVP and Gross Par Written in the table above are based on “close date,” when the transaction settles.

See “— Non-GAAP Financial Measures — PVP or Present Value of New Business Production.” PVP was discounted at 5.0%, 4.0% and 2.5% in 2024, 2023 and 2022, respectively.

See “— Non-GAAP Financial Measures — PVP or Present Value of New Business Production.” PVP was discounted at 5.0% in both 2025 and 2024 and 4.0% in 2023.

GWP relates to insurance and reinsurance contracts for both financial guaranty and specialty business.

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See “— Non-GAAP Financial Measures” below.

public finance GWP and PVP in 2024 were higher than GWP and PVP in 2023 primarily due to a large transportation revenue transaction.

The Company’s direct par written represented 58% of the total U.S.

primary municipal market insured par sold in 2024, compared with 61% in 2023, and the Company’s penetration of all municipal issuance was 4.8% in 2024 compared with 5.4% in 2023.

public finance GWP increased while PVP decreased in 2024 compared with 2023.

GWP in 2024 includes the present value of additional future premiums on a large existing transaction, which is not captured in PVP.

New business in 2024 primarily included secondary market guaranties of several U.K.

regulated utility and airport transactions, as well as new and renewed liquidity guarantees in the infrastructure sector.

In 2024, structured finance GWP and PVP decreased compared with 2023.

Structured finance GWP and PVP in 2024 were primarily attributable to insurance securitizations, bank balance sheet relief transactions, a guaranty of a diversified real estate portfolio and subscription finance transactions.

public finance GWP and PVP include transactions closed in both the primary and secondary markets.

Secondary market GWP and PVP each increased to $44 million in 2025 from $8 million in 2024.

The Company’s par written in the secondary market represented 7.3% of U.S.

public finance par written in 2025, compared with 2.5% in 2024.

public finance GWP and PVP in the primary market were higher in 2024 primarily due to a large transportation revenue transaction that was written in 2024.

public finance GWP and PVP in 2025 included transportation revenue and infrastructure transactions.

The Company’s primary par written represented 58% of the total U.S.

primary municipal market insured par sold in both 2025 and in 2024, and the Company’s penetration of all municipal issuance was 4.4% in 2025 compared with 4.8% in 2024.

GWP for non-U.S.

public finance in 2025 were negative primarily due to the early repayment of several U.K.

sub-sovereign credits.

GWP for non-U.S.

public finance in 2024 included a change in the present value of future premiums on a large existing transaction, which was not a result of new business production and therefore excluded from PVP.

public finance PVP in 2025 was lower than PVP in 2024, primarily due to a lower volume of large transactions in 2025.

public finance PVP in 2025 included several primary infrastructure finance transactions in the European Union and secondary transactions in the U.K.

structured finance GWP and PVP in 2025 were primarily attributable to fund finance facilities, insurance securitizations, the upsize of a transaction providing protection on a core lending portfolio for an Australian bank, and consumer receivable transactions.

Business activity in the non-U.S.

public finance and structured finance markets often has long lead times and therefore may vary from period to period.

Financial Strength Ratings

Demand for the financial guaranties issued by the Company’s insurance subsidiaries may be impacted by changes in the credit ratings assigned to them by the rating agencies.

The financial strength ratings (or similar ratings) assigned to AGL’s insurance subsidiaries, along with the date of the most recent rating action (or confirmation) by the rating agency assigning the rating, are shown in the table below.

S&P KBRA Moody’s A.M.

Best Company,

AG AA (stable) (5/28/24) AA+ (stable) (10/18/24) A1 (stable) (7/10/24) —

AG Re AA (stable) (5/28/24) — — —

AGRO AA (stable) (5/28/24) — — A+ (stable) (7/19/24)

AGUK AA (stable) (5/28/24) AA+ (stable) (10/18/24) A1 (stable) (7/10/24) —

AGE AA (stable) (5/28/24) AA+ (stable) (10/18/24) — —

Ratings are subject to continuous rating agency review and revision or withdrawal at any time.

There can be no assurance that any of the rating agencies will not take negative action on the financial strength ratings (or similar ratings) of AGL’s insurance subsidiaries in the future or cease to rate one or more of AGL’s insurance subsidiaries, either voluntarily or at the request of that subsidiary.

For a discussion of the effects of rating actions on the Company beyond potential effects on the demand for its insurance products, see “Item 1A.

Risk Factors —A downgrade of the financial strength or financial enhancement ratings of any of the Company’s insurance or reinsurance subsidiaries may adversely affect its business prospects.”

Income from Investments

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The investment yield on fixed-maturity securities is a function of market interest rates at the time of investment as well as the type, credit quality and maturity of the securities in this portfolio.

CVIs issued by Puerto Rico and received as part of the 2022 Puerto Rico Resolutions are classified as trading with changes in fair value reported in “fair value gains (losses) on trading securities” in the consolidated statements of operations.

CVIs issued by Puerto Rico and received as part of the resolution of defaulting Puerto Rico exposures in 2022 are classified as trading with changes in fair value reported in “fair value gains (losses) on trading securities” in the consolidated statements of operations.

The fair value of remaining CVIs as of December 31, 2025 and December 31, 2024 was $114 million and $123 million, respectively.

Equity method investments in the Insurance segment include investments that AG Asset Strategies LLC (AGAS) makes in certain alternative investments, primarily Sound Point and AHP funds.

Equity method investments in the Insurance segment include certain alternative investments.

The income (loss) on such investments is reported in “equity in earnings (losses) of investees” and typically represents the Company’s share of earnings of its investees.

As part of the August 5, 2024 AG stock redemption, certain alternative investments were distributed to AGMH, whose results are reported in the Corporate division.

The carrying value of these transferred investments as of December 31, 2024 was $118 million.

As part of stock redemptions that occurred in 2025 and 2024, certain alternative investments were distributed to AGMH, whose results are reported in the Corporate division.

Insurance Segment

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Asset-based/specialty finance 35 24 5

Middle market direct lending 2 — —

Other 18 8 (43)

Private minority stakes in alternative asset manager — 17 2

Commercial real estate finance 1 — —

Equity in earnings (losses) of investees $ 63 $ 102 $ 82

Net investment income for 2024 decreased compared to 2023, primarily due to the lower income on Loss Mitigation Securities and lower average asset balances due in part to sale of new general obligation bonds and new bonds backed by toll revenues (together, New Recovery Bonds) received as part of the 2022 Puerto Rico Resolutions, partially offset by higher income related to the distribution of assets to alternative investments from CIVs.

____________________

(1) Foreign exchange gains on remeasurement of certain investments were $5 million for 2025 and $1 million for 2023.

Net investment income for 2025 increased compared to 2024, primarily due to investment income on CLO equity tranches in the available-for-sale portfolio.

Certain CLO equity tranche investments were reclassified to the available-for-sale fixed-maturity portfolio in the fourth quarter of 2024, with interest income now reported in “net investment income,” and changes in fair value reported in “other comprehensive income.” The Company had previously held the CLO equity tranches in a Sound Point managed fund with changes in net asset value (NAV) reported in “equity in earnings (losses) of investees.” Short-term investment income declined as a result of lower short-term interest rates and lower short-term average investment balances.

The overall pre-tax book yield of available-for-sale fixed-maturity securities and short-term investments was 4.76% as of December 31, 2025 and 4.57% as of December 31, 2024.

Equity in earnings (losses) of investees for 2024 increased compared to 2023, primarily due to higher balances in the alternative investment portfolio and higher fair value gains on alternative investments.

The Company has a consolidated CLO fund, that has been reported on a one-quarter lag with changes in net asset value (NAV) reported in “equity in earnings (losses) of investees”.

In the fourth quarter of 2024, the Company transferred the underlying investments to its fixed-maturity securities, available-for-sale portfolio.

Beginning in the fourth quarter of 2024, interest income from the transferred CLOs are reported in net investment income with changes in fair value reported in other comprehensive income.

Equity in earnings (losses) of investees for 2025 decreased compared to 2024, primarily due to the reclassification of certain CLO equity tranches to the available-for-sale portfolio, as described above.

In addition, equity in earnings (losses) of investees in 2024 included $18 million related to certain alternative investments reported in “private minority stakes in alternative asset manager” and “other” in the table above that AG transferred to AGMH as part of a stock redemption in 2024.

These decreases were partially offset by an increase in the NAV of a asset based/specialty finance and private healthcare funds in 2025.

Other Income (Loss)

The decrease in “other income (loss)” in 2024 compared with 2023 was primarily attributable to the reversal of a previously recorded litigation accrual of $20 million and commutation gains of $10 million in 2023.

See Item 8, Financial Statements and Supplementary Data, Note 17, Contingencies, for additional information.

The increase in “other income (loss)” in 2025 compared with 2024 was primarily attributable to a gain of $23 million recognized in connection with the sale in 2025 of a commercially leased building that was part of a loss mitigation strategy for a troubled insured exposure and $15 million associated with the workout and purchase of bonds issued by a U.K.

regulated utility to which the Company has insured exposure and interest on late financial guaranty premiums.

Economic Loss Development (Benefit)

The insured portfolio includes policies accounted for under several different accounting models depending on the characteristics of the contract and the Company’s control rights.

For a discussion of methodologies and significant estimates for expected loss to be paid (recovered), see Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered).

For the GAAP accounting policies for measurement and recognition for each type of contract, see the notes listed below in Item 8, Financial Statements and Supplementary Data.

For a discussion of methodologies and significant estimates for expected loss to be paid (recovered), see Item 8.

Financial Statements and Supplementary Data, Note 4.

Expected Loss to be

Paid (Recovered).

For the GAAP accounting policies for measurement and recognition for each type of contract, see the notes listed below in Item 8.

Financial Statements and Supplementary Data.

• Note 5 for contracts accounted for as insurance;

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Total $ 101 $ 106 $ (9) $ (3) $ 164

(in billions)

Net exposure rated BIG $ 8.77 $ 10.19

____________________

(1) In 2023, the net expected loss to be paid for FG VIEs primarily related to trusts established as part of the 2022 Puerto Rico Resolutions (Puerto Rico Trusts) and in 2024, the Company satisfied its remaining direct insured obligations and deconsolidated the remaining Puerto Rico Trusts.

See Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered).

(2) The increase in BIG is primarily related to downgrades of certain U.K.

regulated utility exposures.

(1) Includes $63 million of recoveries related to the resolution of the LBIE litigation.

Net Expected Loss to be Paid (Recovered)

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Other structured finance

33 (63) 90 60

Structured finance (10) (106) 122 6

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Such amounts are recorded as reinsurance recoverable on paid losses in “other assets.”

Effect of changes in the risk-free rates included in economic loss development (benefit) was a loss of $4 million in 2024 and a loss of $3 million in 2023.

The effects of changes in the risk-free rates included in economic loss development (benefit) were losses of $7 million and $4 million in 2025 and 2024, respectively.

2025 Net Economic Loss Development

Public Finance:

The economic loss development of $64 million for U.S.

public finance exposures was primarily attributable to PREPA and certain healthcare exposures.

The economic loss development of $33 million for non-U.S.

public finance exposures was primarily attributable to certain U.K.

student accommodation and U.K.

regulated utility exposures.

The economic benefit attributable to U.S.

RMBS of $43 million was mainly attributable to a $33 million benefit from higher assumed and realized recoveries for secured second lien charged-off loans.

Other Structured Finance:

The benefit attributable to other structured finance of $63 million was primarily attributable to recoveries related to the resolution of the LBIE litigation (see Item 8.

Financial Statements and Supplementary Data, Note 6.

Contracts Accounted for as Credit Derivatives).

Financial Statements and Supplementary Data, Note 4.

Expected Loss to be Paid (Recovered), for additional information.

2024 Net Economic Loss Development

Public Finance:

The economic benefit of $9 million for U.S.

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RMBS of $75 million was mainly attributable to a $43 million benefit from higher assumed and realized recoveries for secured second lien charged-off loans and a $15 million benefit from higher assumed recoveries for first lien deferred principal balances.

See Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered), for additional information.

2023 Net Economic Loss Development

Public Finance:

The economic loss development on U.S.

exposures in 2023 was $201 million, which was primarily attributable to PREPA and healthcare exposures, partially offset by higher projected recoveries in other municipal exposures.

The benefit attributable to U.S.

RMBS of $56 million was primarily attributable to a $53 million benefit related to higher recoveries for secured second lien charged-off loans and a $13 million benefit related to improved performance in certain transactions, partially offset by $17 million of loss development related to the return of certain previously received funds.

Insurance Segment Loss Expense

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(ii) eliminates loss and LAE related to FG VIEs;

and (iii) does not include estimated losses on credit derivatives.

Insurance segment loss expense includes loss and LAE on financial guaranty insurance contracts and losses on credit derivatives without giving effect to eliminations related to the consolidation of FG VIEs.

and (iii) does not include estimated losses or benefits on credit derivatives.

For financial guaranty insurance contracts, each transaction’s expected loss to be expensed is compared with the deferred premium revenue of that transaction.

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Therefore, the timing of loss recognition in income does not necessarily coincide with the timing of the actual credit impairment or improvement reported in net economic loss development.

Transactions (particularly BIG transactions) acquired in business combinations or seasoned portfolios assumed from legacy financial guaranty insurers generally have the largest deferred premium revenue balances.

Transactions acquired in business combinations or seasoned portfolios assumed from legacy financial guaranty insurers (particularly BIG transactions) generally have large deferred premium revenue balances.

To the extent that a BIG transaction has a large deferred premium revenue, the difference between economic development and loss and LAE may be significant.

While expected loss to be paid (recovered) is an important measure that provides the present value of amounts that the Company expects to pay or recover in future periods regardless of accounting model, expected loss to be expensed is important because it presents the Company’s projection of net expected losses that will be recognized in the consolidated statement of operations in future periods as deferred premium revenue amortizes into income for financial guaranty insurance policies.

For additional information on the expected timing of net expected losses to be expensed see Item 8, Financial Statements and Supplementary Data, Note 5, Contracts Accounted for as Insurance.

While expected loss to be paid (recovered) is an important measure that provides the present value of amounts that the Company expects to pay or recover in future periods regardless of accounting model, expected loss to be expensed is important because it presents the Company’s projection of net expected losses that will be recognized in the consolidated statements of operations in future periods as deferred premium revenue amortizes into income for financial guaranty insurance policies.

For additional information on the expected timing of net expected losses to be expensed, see Item 8.

Financial Statements and Supplementary Data, Note 5.

Contracts Accounted for as Insurance.

The amount of Insurance segment loss expense, which includes losses on policies regardless of form, is a function of the amount of economic loss development discussed above and the deferred premium revenue amortization in a given period, on a contract-by-contract basis.

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Total Insurance segment loss expense (benefit) $ (8) $ (18) $ 161

Employee Compensation and Benefit Expenses and Other Operating Expenses

The increase in employee compensation and benefit expenses in 2024 from 2023 was primarily attributable to an increase in headcount and other employee benefit costs.

Other operating expenses increased in 2024 from 2023 primarily due to the write-off of $6 million of intangible assets attributable to insurance licenses in connection with AGM’s merger with and into AG.

Provision (Benefit) for Income Taxes

The tax provision in 2024 includes $13 million of global minimum tax for the Company’s Bermuda subsidiaries.

The tax benefit in 2023 was primarily related to the $189 million benefit recognized in connection with the enactment of the 15% Bermuda corporate income tax in December 2023.

The new Bermuda corporate income tax allows for a deferred tax asset associated with an ETA equal to the difference between the fair market value and the carrying value of assets and liabilities of each of the Company’s Bermuda insurance subsidiaries as of September 30, 2023.

The ETA is expected to be utilized over 10 to 15 years, depending on the nature of the deferred tax asset component, beginning in 2025.

This was partially offset by income tax expense in the Company’s other operating jurisdictions.

The Company expects its Bermuda insurance subsidiaries to incur tax which will be offset by the realization of the deferred tax asset beginning in 2025.

See Item 8, Financial Statements and Supplementary Data, Note 13, Income Taxes, for additional information.

____________________

(1) 2025 includes $63 million of recoveries in connection with the resolution of the LBIE litigation.

Financial Statements and Supplementary Data, Note 6.

Contracts Accounted for as Credit Derivatives.

Employee Compensation and Benefit Expenses

The increase in employee compensation and benefit expenses to $182 million 2025 from $170 million in 2024 was primarily attributable to higher long-term compensation expenses, increase in headcount and other employee benefit costs.

Asset Management Segment Results

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Segment adjusted operating income (loss) $ 20 $ 5 $ 3

Results in the table above primarily represent (i) equity in earnings of Sound Point since the third quarter of 2023 (Sound Point results are reported on a one-quarter lag), net of the amortization of finite-lived intangible assets associated with the basis difference in Sound Point, and incentive fees, and (ii) the consolidated results of AssuredIM for 2022 and the first half of 2023, prior to the Sound Point Transaction and the AHP Transaction.

See Item 8, Financial Statements and Supplementary Data, Note 7, Investments and Cash, for additional information.

Results in the table above primarily represent (i) equity in earnings (losses) of Sound Point since the third quarter of 2023 (Sound Point results are reported on a one-quarter lag), net of the amortization of finite-lived intangible assets associated with the basis difference in Sound Point, (ii) an impairment loss of $3 million in 2024 for a small financial services advisory firm, and (iii) other asset management related income.

Corporate Division Results

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Adjusted operating income (loss) $ (89) $ (135) $ 45

The gain on sale of asset management subsidiaries relates to the Sound Point Transaction and AHP Transaction.

See Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation.

Corporate division interest expense primarily relates to debt issued by AGUS and AGMH (the U.S.

Corporate division interest expense primarily relates to debt issued by the AGUS and AGMH (U.S.

Holding Companies), and also includes intersegment interest expense.

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Holding Companies, Intercompany Loans Payable” for additional information.

Corporate division employee compensation and benefits expenses and other operating expenses are an allocation of expenses based on time studies and represent the costs incurred and time spent on holding company activities, capital management, corporate oversight and governance including Board of Director expenses, legal fees and other direct or allocated expense.

The decrease in operating expenses in 2024 was primarily due to expenses related to the Sound Point Transaction and AHP Transaction and a higher charge for value added taxes in 2023.

Transaction related expenses in the Corporate division for Sound Point and AHP in 2023 were $40 million, consisting primarily of $25 million advisory and consent fees and $8 million legal fees.

Equity in earnings of investees in 2024 relates to certain alternative investments, which AG transferred to AGMH as part of the share redemption that occurred on August 5, 2024.

The provision for income taxes in 2023 included a $19 million benefit attributable to a change in New York State tax law.

Equity in earnings of investees in 2025 and 2024 relates to certain alternative investments, that AG transferred to AGMH as part of stock redemptions in 2024 and 2025.

See “— Liquidity and Capital Resources—Insurance Subsidiaries—Stock Redemptions by Insurance Subsidiaries” below.

The carrying value of these transferred investments as of December 31, 2025 was $184 million.

management, corporate oversight and governance including the Board’s expenses, legal fees and other direct or allocated expense.

Other (Effect of Consolidating FG VIEs and CIVs)

The effect of consolidating FG VIEs and CIVs, intersegment eliminations and, prior to July 1, 2023, reclassifications of reimbursable fund expenses to revenue, are presented in “other.” See Item 8, Financial Statements and Supplementary Data, Note 2, Segment Information.

As described in Item 8, Financial Statements and Supplementary Data, Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles, the types of entities the Company consolidates when it is deemed to be the primary beneficiary primarily include:

The effect of consolidating FG VIEs and CIVs, intersegment eliminations and, prior to July 1, 2023, reclassifications of reimbursable fund expenses to revenue are presented in “other.” See Item 8.

Financial Statements and Supplementary Data, Note 2.

Segment Information.

As described in Item 8.

Financial Statements and Supplementary Data, Note 8.

Variable Interest Entities, the types of entities the Company consolidates when it is deemed to be the primary beneficiary primarily include:

and (ii) CIVs.

The Company eliminates the effects of intercompany transactions between its FG VIEs and CIVs and its insurance and asset management subsidiaries, as well as intercompany transactions between CIVs.

Consolidating FG VIEs (as opposed to accounting for the related insurance contracts in the Insurance segment), has a significant gross-up effect on the consolidated financial statements, and includes:

Consolidating FG VIEs (as opposed to accounting for the related insurance contracts in the Insurance segment), has a gross-up effect on the consolidated financial statements, and includes:

(i) the establishment of the FG VIEs’ assets and liabilities and related changes in fair value on the consolidated financial statements;

(ii) eliminating the premiums and

losses/recoveries associated with the financial guaranty insurance contracts between the insurance subsidiaries and the FG VIEs;

(ii) eliminating the premiums and losses/recoveries associated with the financial guaranty insurance contracts between the insurance subsidiaries and the FG VIEs;

and (iii) eliminating the investment balances associated with the insurance subsidiaries’ purchases of the debt obligations of the FG VIEs.

Consolidating CIVs (as opposed to accounting for them as equity method investments) has a significant effect on assets, liabilities and cash flows, and includes:

Consolidating investment vehicles in which the Company invests (as opposed to accounting for them as equity method investments) has a significant effect on assets, liabilities and cash flows, and includes:

(i) the establishment of the assets and liabilities of the CIVs, and related changes in fair value;

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(iii) eliminating the equity method investments of the insurance subsidiaries, and related equity in earnings (losses) of investees;

and (iv) establishing noncontrolling interest (NCI) for amounts not owned by the Company.

and (iv) establishing NCI for amounts not owned by the Company.

The economic effect of AG’s ownership interests in CIVs is presented in the Insurance segment as “equity in earnings (losses) of investees,” while the effect of CIVs is presented as separate line items (“fair value gains (losses) on consolidated investment vehicles” and “noncontrolling interest”) on a consolidated basis.

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Effect on net income (loss) 46 10 1

Effect on noncontrolling interests (4) 16 22 13

Effect on NCI (4) 40 16 22

Effect on net income (loss) attributable to AGL $ 6 $ (6) $ (21)

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____________________

(1) Changes in fair value of the FG VIEs’ assets and liabilities that are attributable to factors other than (i) changes in the Company’s own credit risk on the FG VIEs’ liabilities with recourse and (ii) unrealized gains and losses on available-for-sale fixed maturity securities.

(2) Represents the elimination of the equity in earnings (losses) of investees of AGAS and the other subsidiaries’ investments in certain alternative investments, primarily Sound Point funds (and prior to July 1, 2023, AssuredIM managed funds).

(3) Includes net earned premiums, net investment income, foreign exchange gains (losses) on remeasurement, other income (loss), loss and LAE (benefit), and for 2023 and 2022, other operating expenses and asset management fees.

(4) Represents the proportion of consolidated funds managed by Sound Point and prior to July 1, 2023, AssuredIM funds’ income that is not attributable to AGAS’ or any other subsidiaries’ ownership interest.

(1) Changes in fair value of the FG VIEs’ assets and liabilities reported in the statements of operations are attributable to factors other than (i) changes in the Company’s own credit risk on the FG VIEs’ liabilities with recourse and (ii) unrealized gains and losses on available-for-sale fixed maturity securities.

(2) Represents the elimination of the equity in earnings (losses) of investees of the Company’s investments in certain alternative investments, primarily Sound Point funds (and prior to July 1, 2023, AssuredIM managed funds).

(3) Includes net earned premiums, net investment income, foreign exchange gains (losses) on remeasurement, other income (loss), loss and LAE (benefit) and, for 2023, other operating expenses and asset management fees.

(4) Represents the proportion of consolidated funds managed by Sound Point and, prior to July 1, 2023, AssuredIM funds’ income that is not attributable to the Company’s ownership interest.

Reconciliation to GAAP

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2025 2024 2023

(per share amounts)

(per diluted share amounts)

Net income (loss) attributable to AGL $ 10.26 $ 6.87 $ 12.30

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Net realized investment gains (losses) $ (40) $ 9 $ (14)

____________________

(1) Relates primarily to Loss Mitigation Securities.

Sales of New Recovery Bonds received as part of the 2022 Puerto Rico Resolutions were the primary components of gross realized gains on sales in 2023 and gross realized losses on sales in 2022.

The change in the allowance for credit losses for 2025 was primarily associated with CLO equity tranches and Loss Mitigation Securities.

The change in the allowance for credit losses for 2024 was primarily related to Loss Mitigation Securities.

Non-Credit Impairment-Related Unrealized Fair Value Gains (Losses) on Credit Derivatives

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Except for underlying credit impairment, which is recognized as loss expense in the Insurance segment, the fair value adjustments on credit derivatives in the insured portfolio are non-economic adjustments that reverse to zero over the remaining term of that portfolio.

See Item 8, Financial Statements and Supplementary Data, Note 9, Fair Value Measurement, for additional information.

Financial Statements and Supplementary Data, Note 9.

Fair Value Measurement, for additional information.

During 2025, non-credit impairment-related unrealized fair value gains of $6 million were primarily due to generally lower collateral asset spreads.

During 2024, non-credit impairment-related unrealized fair value gains of $14 million were generated primarily due to the termination of certain structured finance policies and generally lower collateral asset spreads.

During 2023, non-credit impairment-related unrealized fair value gains of $106 million were generated primarily as a result of generally lower collateral asset spreads.

Fair Value Gains (Losses) on CCS

Fair value losses on CCS of $10 million in 2024 and $35 million in 2023 were primarily due to a tightening in market spreads.

Fair value gains (losses) on CCS are heavily affected by, and in part fluctuate with, changes in market spreads and interest rates, credit spreads and other market factors and are not expected to result in an economic gain or loss.

Foreign Exchange Gain (Loss) on Remeasurement

Foreign exchange gains and losses of $26 million losses, $51 million gains and $110 million losses in 2024, 2023 and 2022, respectively, primarily relate to remeasurement of long-dated premiums receivable, for which the Company records the present value of future installment premiums, and are mainly due to changes in the exchange rate of the pound sterling and, to a lesser extent, the euro relative to the U.S.

Approximately 69% and 70% of gross premiums receivable, net of commissions payable at December 31, 2024 and December 31, 2023, respectively, are denominated in currencies other than the U.S.

dollar, primarily the pound sterling and euro.

Fair value gains on CCS of $20 million in 2025 were primarily due to changes in the rate environment and market view on liquidity of floating rate instruments.

Fair value losses on CCS of $10 million in 2024 were primarily due to a tightening in market spreads.

Fair value gains (losses) on CCS are heavily affected by, and in part fluctuate with, changes in market credit spreads and interest rates, and other market factors and are not expected to result in an economic gain or loss.

Financial Statements and Supplementary Data, Note 9.

Fair Value Measurement.

Foreign Exchange Gains (Losses) on Remeasurement

Foreign exchange gains of premiums receivable and loss and LAE reserves of $85 million, losses of $26 million and gains of $51 million in 2025, 2024 and 2023, respectively, primarily relate to remeasurement of long-dated premiums receivable, for which the Company records the present value of future installment premiums.

Foreign exchange gains and losses are mainly due to changes in the exchange rate of the pound sterling and, to a lesser extent, the euro relative to the U.S.

Approximately 68% and 69% of gross premiums receivable, net of commissions payable as of December 31, 2025 and December 31, 2024, respectively, are denominated in currencies other than the U.S.

Premiums on European infrastructure and structured finance transactions typically are paid, in whole or in part, on an installment basis, whereas premiums on U.S.

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In the case of both the consolidated FG VIEs and the CIVs, the economic effect on the Company of each of the consolidated FG VIEs and CIVs is reflected primarily in the results of the Insurance segment.

Management of the Company and AGL’s Board of Directors use non-GAAP financial measures further adjusted to remove the effect of FG VIE and CIV consolidation (which the Company refers to as its core financial measures), as well as GAAP financial measures and other factors, to evaluate the Company’s results of operations, financial condition and progress towards long-term goals.

The Company’s management and AGL’s Board of Directors use non-GAAP financial measures further adjusted to remove the effect of FG VIE and CIV consolidation (which the Company refers to as its core financial measures), as well as GAAP financial measures and other factors, to evaluate the Company’s results of operations, financial condition and progress towards long-term goals.

The Company uses core financial measures in its decision-making process for and in its calculation of certain components of management compensation.

The financial measures that the Company uses to help determine compensation are:

(1) adjusted operating income, further adjusted to remove the effect of FG VIE and CIV consolidation;

(2) adjusted operating shareholders’ equity, further adjusted to remove the effect of FG VIE and CIV consolidation;

(3) adjusted book value per share, further adjusted to remove the effect of FG VIE and CIV consolidation;

Management believes that many investors, analysts and financial news reporters use adjusted operating shareholders’ equity and/or adjusted book value, each further adjusted to remove the effect of FG VIE and CIV consolidation, as the principal financial measures for valuing AGL’s current share price or projected share price and also as the basis of their decision to recommend, buy or sell AGL’s common shares.

The financial measures that the Company uses to help determine

compensation are:

(i) adjusted operating income per share, further adjusted to remove the effect of FG VIE and CIV consolidation (core operating income per share);

(ii) adjusted operating shareholders’ equity per share, further adjusted to remove the effect of FG VIE and CIV consolidation (core operating shareholders’ equity per share);

(iii) ABV per share, further adjusted to remove the effect of FG VIE and CIV consolidation (core ABV per share);

(iv) core operating return on equity, which is calculated as core operating income divided by the average of core operating shareholders’ equity at the beginning and end of the period;

The Company’s management believes that many investors, analysts and financial news reporters use adjusted operating shareholders’ equity and/or ABV, each further adjusted to remove the effect of FG VIE and CIV consolidation, as the principal financial measures for valuing AGL’s current share price or projected share price and also as the basis of their decision to recommend, buy or sell AGL’s common shares.

Adjusted operating income, further adjusted for the effect of FG VIE and CIV consolidation, enables investors and analysts to evaluate the Company’s financial results in comparison with the consensus analyst estimates distributed publicly by financial databases.

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Adjusted Operating Income

Management believes that adjusted operating income is a useful measure because it clarifies the understanding of the operating results of the Company.

The Company’s management believes that adjusted operating income is a useful measure because it clarifies the understanding of the operating results of the Company.

Adjusted operating income is defined as net income (loss) attributable to AGL, as reported under GAAP, adjusted for the following:

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The timing of sales is largely subject to the Company’s discretion and influenced by market opportunities, as well as the Company’s tax and capital profile.

2) Elimination of non-credit impairment-related unrealized fair value gains (losses) on credit derivatives that are recognized in net income (loss) attributable to AGL, which is the amount of unrealized fair value gains (losses) in excess of the present value of the expected estimated economic credit losses, and non-economic payments.

2) Elimination of non-credit impairment-related unrealized fair value gains (losses) on credit derivatives that are recognized in net income (loss) attributable to AGL, which is the amount of fair value gains (losses) in excess of the present value of the expected estimated economic credit losses.

Such fair value adjustments are heavily affected by, and in part fluctuate with, changes in market interest rates, the Company’s credit spreads, and other market factors and are not expected to result in an economic gain or loss.

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5) The tax effects related to the above adjustments, which are determined by applying the statutory tax rate in each of the jurisdictions that generate these adjustments.

Adjusted operating income per share is calculated by dividing adjusted operating income by the weighted average diluted shares.

The method for calculating weighted average diluted shares is in accordance with GAAP.

See “— Results of Operations — Reconciliation to GAAP” for a reconciliation of net income (loss) attributable to AGL to adjusted operating income (loss).

Adjusted Operating Shareholders’ Equity and Adjusted Book Value

Management believes that adjusted operating shareholders’ equity is a useful measure because it excludes the fair value adjustments on investments, credit derivatives and CCS that are not expected to result in economic gain or loss.

Adjusted Operating Shareholders’ Equity and ABV

The Company’s management believes that adjusted operating shareholders’ equity is a useful measure because it excludes the fair value adjustments on investments, credit derivatives and CCS that are not expected to result in economic gain or loss.

The Company’s management uses ABV, further adjusted to remove the effect of FG VIE and CIV consolidation, to measure the intrinsic value of the Company, excluding franchise value.

The Company’s management believes that ABV is a useful measure because it enables an evaluation of the Company’s in-force premiums and revenues net of expected losses.

Adjusted operating shareholders’ equity per share and ABV per share, each further adjusted for FG VIE and CIV consolidation (core operating shareholders’ equity per share and core ABV per share, respectively), are two of the key financial measures used in determining the amount of certain long-term compensation elements to management and employees and used by rating agencies and investors.

Adjusted operating shareholders’ equity is defined as shareholders’ equity attributable to AGL, as reported under GAAP, adjusted for the following:

1) Elimination of non-credit impairment-related unrealized fair value gains (losses) on credit derivatives, which is the amount of unrealized fair value gains (losses) in excess of the present value of the expected estimated economic credit losses, and non-economic payments.

1) Elimination of non-credit impairment-related unrealized fair value gains (losses) on credit derivatives that are reported on the consolidated balance sheet, which is the amount of unrealized fair value gains (losses) in excess of the present value of the expected estimated economic credit losses.

Such fair value adjustments are heavily affected by, and in part fluctuate with, changes in market interest rates, credit spreads and other market factors and are not expected to result in an economic gain or loss.

2) Elimination of fair value gains (losses) on the Company’s CCS.

2) Elimination of fair value gains (losses) on the Company’s CCS that are reported on the consolidated balance sheet.

Such amounts are affected by changes in market interest rates, the Company’s credit spreads, price indications on the Company’s publicly traded debt and other market factors and are not expected to result in an economic gain or loss.

3) Elimination of unrealized gains (losses) on the Company’s investments that are recorded as a component of accumulated other comprehensive income (AOCI).

The AOCI component of the fair value adjustment on the investment portfolio is not deemed economic because the Company generally holds these investments to maturity and therefore would not recognize an economic gain or loss.

4) The tax effects related to the above adjustments, which are determined by applying the statutory tax rate in each of the jurisdictions that generate these adjustments.

Management uses adjusted book value, further adjusted to remove the effect of FG VIE and CIV consolidation, to measure the intrinsic value of the Company, excluding franchise value.

Adjusted book value per share, further adjusted for FG VIE and CIV consolidation (core adjusted book value), is one of the key financial measures used in determining the amount of

certain long-term compensation elements to management and employees and used by rating agencies and investors.

Management believes that adjusted book value is a useful measure because it enables an evaluation of the Company’s in-force premiums and revenues net of expected losses.

Adjusted book value is adjusted operating shareholders’ equity, as defined above, further adjusted for the following:

ABV is adjusted operating shareholders’ equity, as defined above, further adjusted for the following:

1) Elimination of deferred acquisition costs, net.

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3) Addition of the deferred premium revenue on financial guaranty contracts in excess of expected loss to be expensed, net of reinsurance.

This amount represents the present value of the expected future net earned premiums, net of the present value of expected losses to be expensed, which are not reflected in GAAP equity.

This amount represents the present value of the expected future net earned premiums, net of the present value of expected losses to be expensed.

4) The tax effects related to the above adjustments, which are determined by applying the statutory tax rate in each of the jurisdictions that generate these adjustments.

The unearned premiums and revenues included in adjusted book value will be earned in future periods, but actual earnings may differ materially from the estimated amounts used in determining current adjusted book value due to changes in foreign exchange rates, prepayment speeds, terminations, credit defaults and other factors.

Shares outstanding as of the end of the reporting period are used to calculate adjusted operating shareholders’ equity per share and ABV per share.

The unearned premiums and revenues included in ABV will be earned in future periods, but actual earnings may differ materially from the estimated amounts used in determining current ABV due to changes in foreign exchange rates, prepayment speeds, terminations, credit defaults and other factors.

Reconciliation of Shareholders’ Equity Attributable to AGL

to Adjusted Operating Shareholders’ Equity and Adjusted Book Value

to Adjusted Operating Shareholders’ Equity and ABV

As of December 31, 2025 As of December 31, 2024

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Plus taxes (674) (14.91) (702) (13.90)

Adjusted book value $ 8,592 $ 170.12 $ 8,765 $ 155.92

ABV $ 8,424 $ 186.43 $ 8,592 $ 170.12

Gain (loss) related to FG VIE and CIV consolidation included in:

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$ 8 $ 0.18 $ — $ 0.01

Adjusted book value (net of tax provision (benefit) of $(2) and $0)

ABV (net of tax provision (benefit) of $1 and $(2))

3 0.07 (6) (0.13)

Net Present Value of Estimated Net Future Revenue

Management believes that this amount is a useful measure because it enables an evaluation of the present value of estimated net future revenue for non-financial guaranty insurance contracts.

This amount represents the net present value of

estimated future revenue from these contracts (other than credit derivatives with net expected losses), net of reinsurance, ceding commissions and premium taxes.

The Company’s management believes that this amount is a useful measure because it enables an evaluation of the present value of estimated net future revenue for non-financial guaranty insurance contracts.

This amount represents the net present value of estimated future revenue from these contracts (other than credit derivatives with net expected losses), net of reinsurance, ceding commissions and premium taxes.

Future installment premiums are discounted at the approximate average pre-tax book yield of fixed-maturity securities purchased during the prior calendar year, other than Loss Mitigation Securities.

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PVP or Present Value of New Business Production

Management believes that PVP is a useful measure because it enables the evaluation of the value of new business production in the Insurance segment by taking into account the value of estimated future installment premiums on all new contracts underwritten in a reporting period as well as additional installment premiums and fees on existing contracts (which may result from supplements or fees or from the issuer not calling an insured obligation the Company projected would be called), regardless of form, which management believes GAAP gross written premiums and changes in fair value of credit derivatives do not adequately measure.

The Company’s management believes that PVP is a useful measure because it enables the evaluation of the value of new business production in the Insurance segment by taking into account the value of estimated future installment premiums on all new contracts underwritten in a reporting period as well as additional installment premiums and fees on existing contracts (which may result from supplements or fees or from the issuer not calling an insured obligation the Company projected would be called), regardless of form, which management believes GAAP gross written premiums and changes in fair value of credit derivatives do not adequately measure.

PVP in respect of contracts written in a specified period is defined as gross upfront and installment premiums received and the present value of gross estimated future installment premiums.

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The discount rate is recalculated annually and updated as necessary.

Under GAAP, financial guaranty installment premiums are discounted at a risk-free rate.

Under GAAP, financial guaranty installment premiums are

discounted at a risk-free rate.

Additionally, under GAAP, management records future installment premiums on financial guaranty insurance contracts covering non-homogeneous pools of assets based on the contractual term of the transaction, whereas for PVP purposes, management records an estimate of the future installment premiums the Company expects to receive, which may be based upon a shorter period of time than the contractual term of the transaction.

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Financial Guaranty Exposure

The following tables present information in respect of the financial guaranty insured portfolio to supplement the disclosures and discussion provided in Item 8, Financial Statements and Supplementary Data, Note 3, Outstanding Exposure.

The following tables present information in respect of the financial guaranty insured portfolio to supplement the disclosures and discussion provided in Item 8.

Financial Statements and Supplementary Data, Note 3.

Outstanding Exposure.

Unless otherwise noted, ratings on Assured Guaranty’s insured portfolio are Assured Guaranty’s internal ratings.

Internal credit

ratings are expressed on a rating scale similar to that used by the rating agencies and generally reflect an approach similar to that employed by the rating agencies, except that Assured Guaranty’s internal credit ratings focus on future performance, rather than lifetime performance.

The tables below show the Company’s ten largest U.S.

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(dollars in millions)

New Jersey (State of) $ 2,362 1.2 % BBB

JFK New Terminal One, New York $ 2,209 1.0 % BBB-

Pennsylvania (Commonwealth of) 1,852 0.9 BBB

Lower Colorado River Authority 1,642 0.8 A

Metro Washington Airports Authority (Dulles Toll Road) 1,629 0.7 BBB+

JFK New Terminal One, New York 1,600 0.8 BBB-

New Jersey (State of) 1,570 0.7 BBB

Alameda Corridor Transportation Authority, California 1,427 0.7 BBB

North Texas Tollway Authority 1,355 0.7 A+

Lower Colorado River Authority 1,333 0.6 A

New York Power Authority 1,306 0.6 AA-

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Foothill/Eastern Transportation Corridor Agency, California 1,284 0.6 BBB+

CommonSpirit Health, Illinois 1,231 0.6 A-

Total of top ten U.S.

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(dollars in millions)

Private US Insurance Securitization $ 1,196 14.1 % AA-

Private US Insurance Securitization 1,100 13.0 AA-

Private US Insurance Securitization 1,100 13.0 AA

Private US Insurance Securitization 414 4.9 AA-

Private US Insurance Securitization 398 4.7 AA-

Private Middle Market CLO 167 2.0 A

DB Master Finance LLC 165 2.0 BBB

Private US Insurance Reserve Financing $ 1,102 14.0 % AA-

Private US Insurance Reserve Financing 1,100 14.0 AA

Private US Insurance Reserve Financing 1,000 12.7 AA-

Private US Insurance Reserve Financing 425 5.4 AA-

Private US Insurance Reserve Financing 398 5.1 AA-

Private Middle Market CLO 200 2.5 AA

Private US Insurance Securitization 177 2.2 A

Private Middle Market CLO 125 1.6 BBB+

SLM Student Loan Trust 2007-A 123 1.5 AA

Private US Insurance Securitization 114 1.6 AA

Private Fund Finance Transaction 105 1.3 A-

Total of top ten U.S.

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(dollars in millions)

Southern Water Services Limited United Kingdom $ 2,611 5.0 % BB

Southern Water Services Limited United Kingdom $ 2,866 5.3 % BBB-

Thames Water Utilities Finance PLC United Kingdom 2,400 4.4 B

Southern Gas Networks PLC United Kingdom 2,082 4.0 BBB+

Dwr Cymru Financing Limited United Kingdom 2,060 3.8 A-

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Channel Link Enterprises Finance PLC France, United Kingdom 1,315 2.4 BBB

Quebec Province Canada 1,021 2.0 AA-

Severn Trent Water Utilities Finance Plc United Kingdom 1,087 2.0 BBB+

Capital Hospitals (Issuer) PLC United Kingdom 1,060 2.0 BBB-

United Utilities Water PLC United Kingdom 984 1.8 BBB+

Total of top ten non-U.S.

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Original Par Amount Per Issue Number of

(dollars in millions)

(dollars in billions)

Less than $10 million 10,180 $ 31.7 11.9 %

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% of Structured

(dollars in millions)

(dollars in billions)

Less than $10 million 85 $ 0.1 0.8 %

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All of the Company’s insured exposure to various authorities and public corporations of the Commonwealth of Puerto Rico (Puerto Rico or the Commonwealth) is rated BIG.

Puerto Rico net par and net debt service outstanding as of December 31, 2024 were $637 million and $756 million respectively, compared with net par and net debt service outstanding as of December 31, 2023 of $1,105 million and $1,508 million, respectively.

As of December 31, 2024, the Company’s only remaining outstanding insured Puerto Rico exposure subject to a payment default was PREPA, which had net par and debt service outstanding of $532 million and $629 million, respectively.

The Company’s Puerto Rico net par and net debt service outstanding as of December 31, 2025 were $553 million and $643 million, respectively, compared with net par and net debt service outstanding as of December 31, 2024 of $637 million and $756 million, respectively.

As of December 31, 2025, the Company’s only remaining outstanding unresolved insured Puerto Rico exposure subject to a payment default was PREPA, to which the Company had net par and debt service outstanding of $464 million and $537 million, respectively.

As of December 31, 2024, PREPA net par and debt service outstanding were $532 million and $629 million, respectively.

See “—Liquidity and Capital Resources—Insurance Subsidiaries, Financial Guaranty Policies” below and Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered), for more information.

See “—Liquidity and Capital Resources—Insurance Subsidiaries, Financial Guaranty Policies” below and Item 8.

Financial Statements and Supplementary Data, Note 4.

Expected Loss to be Paid (Recovered), for more information.

The following table shows the scheduled amortization for PREPA.

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2031-2037 101 110

2035-2037 4 4

Total $ 464 $ 537

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holding company with public debt outstanding.

AGUS directly owns AGMH, another U.S.

AGUS directly owns AGMH, a U.S.

holding company with public debt outstanding.

As of August 1, 2024, AGMH directly owns AG, an insurance company domiciled in Maryland.

Until August 1, 2024, AGMH directly owned AGM, an insurance company domiciled in New York.

See “— Overview — Key Business Strategies — Merger of the U.S.

Insurance Subsidiaries” above.

AGMH directly owns AG, an insurance company domiciled in Maryland.

AGUS and AGMH are collectively referred to as the U.S.

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The liquidity of AGL and its U.S.

Holding Companies is largely dependent on dividends, stock redemptions and other distributions from their operating subsidiaries (see “— Insurance Subsidiaries — Distributions from Insurance Subsidiaries” below) and access to external financing.

Holding Companies is largely dependent on dividends, stock redemptions and other distributions from their operating subsidiaries (see “— Insurance Subsidiaries — Ordinary Dividends From Insurance Subsidiaries to Holding Companies” below) and access to external financing.

The operating liquidity requirements of AGL and the U.S.

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• make capital investments in their operating subsidiaries and in alternative investments;

• fund acquisitions of new businesses;

• fund acquisitions of new businesses or expand insurance business;

• purchase or redeem the Company’s outstanding debt;

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In the ordinary course of business, the Company evaluates its liquidity needs and capital resources in light of holding company expenses and dividend policy, as well as rating agency considerations.

The Company also subjects its cash flow projections and its assets to a stress test, maintaining a liquid asset balance of one and a half times its stressed operating company net cash flows.

The Company also subjects its cash flow projections and its assets to a stress test, maintaining a liquid asset balance of one and a half times its stressed operating company net cash flows over the next four quarters.

Management believes that AGL will have sufficient liquidity to satisfy its needs over the next twelve months.

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Holding Companies.

See Item 8, Financial Statements and Supplementary Data, Note 11, Long-Term Debt and Credit Facilities, and Guarantor and U.S.

Financial Statements and Supplementary Data, Note 11.

Long-Term Debt and Credit Facilities, and Guarantor and U.S.

Holding Companies’ Summarized Financial Information below.

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AGUS - intercompany loans from:

AG/AGM (1) 3.50% 2029 250 250

AG 3.50% 2029 200 250

AGUS intercompany loans 220 270

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____________________

(1) Effective August 1, 2024, AGM merged with and into AG, with AG as the surviving company.

(1) If the AGMH Junior Subordinated Debentures are outstanding after December 15, 2036, then the principal amount of the outstanding debentures will bear interest at One-Month Chicago Mercantile Exchange (CME) Term Secured Overnight Finance Rate (SOFR) plus 2.33%.

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On September 25, 2023, AGUS redeemed $330 million of 5% Senior Notes due 2024.

See Item 8, Financial Statements and Supplementary Data, Note 11, Long-Term Debt and Credit Facilities.

Financial Statements and Supplementary Data, Note 11.

Long-Term Debt and Credit Facilities.

Holding Companies

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Intercompany Loans Payable

On October 1, 2019, AG made a 10-year, 3.5% interest rate intercompany loan to AGUS, in the amount of $250 million, to fund the acquisition of BlueMountain Capital Management LLC (AssuredIM LLC, now known as Sound Point Luna LLC) and its associated entities, and the related capital contributions.

On October 1, 2019, AG made a 10-year, 3.5% interest rate intercompany loan to AGUS, in the amount of $250 million, to fund the acquisition of, and capital contributions to, BlueMountain Capital Management LLC and its associated entities, which were subsequently contributed to Sound Point or sold.

Interest is payable annually in arrears on each anniversary of the note, and commenced on October 1, 2020.

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AGUS has the right to prepay the principal amount of the notes in whole or in part at any time, or from time to time, without payment of any premium or penalty.

During 2025, AGUS repaid $50 million in outstanding principal as well as accrued and unpaid interest.

As of December 31, 2025, $200 million remained outstanding.

Guarantor and U.S.

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Receivables from affiliates (2) 68 —

Dividends receivable from U.S.

Holding Companies 150 —

Other assets 2 26

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Payable to affiliates (2) 13 10

Dividends payable to AGL — 150

Other liabilities 8 69

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Income (loss) before provision for income taxes and equity in earnings (losses) of investees (41) (105)

Equity in earnings (losses) of investees — 62

Net income (loss) excluding investments in subsidiaries (41) (42)

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Dividends paid to AGL — (685)

Repayment of intercompany loans — (50)

Dividends paid to AGL shareholders (68) —

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____________________

(1) Includes distributions from Sound Point and other alternative investments.

(2) See Item 8, Financial Statements and Supplementary Data, Note 18, Shareholders’ Equity, for additional information about share repurchases and authorizations.

(1) Includes distributions from Sound Point of $18 million and other alternative investments.

(2) See Item 8.

Financial Statements and Supplementary Data, Note 18.

Shareholders’ Equity, for additional information about share repurchases and authorizations.

Generally, dividends paid by a U.S.

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Insurance Subsidiaries

The Company has several insurance subsidiaries.

The Company has several financial guaranty insurance subsidiaries.

AG is an insurance subsidiary domiciled in Maryland.

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and (ii) AGE, an insurance company domiciled in France.

Until August 1, 2024, AGM was an insurance subsidiary of the Company domiciled in New York.

See “— Overview — Key Business Strategies — Merger of the U.S.

Insurance Subsidiaries” above.

AGUK and AGE are collectively referred to as the European Insurance Subsidiaries.

AG Re is an insurance company domiciled in Bermuda that owns AGRO, an insurance company that is also domiciled in Bermuda.

The Company conducts its life and annuity reinsurance business through Assured Life Re, an insurance company domiciled in Bermuda which was acquired by the Company on January 21, 2026.

Sources and Uses of Funds

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• dividends or other distributions to parent,

• reinsurance premiums, and

• reinsurance premiums,

• expansion of the insurance business, and

• capital investments in their own subsidiaries and in alternative investments.

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Treasuries, agency RMBS and pre-refunded municipal bonds equal to 1.5 times its projected operating company cash flow needs over the next four quarters.

As of December 31, 2024, the Company intended to hold and had the ability to hold securities in an unrealized loss position until the date of anticipated recovery of amortized cost.

As of December 31, 2025, the

Company intended to hold and had the ability to hold securities in an unrealized loss position until the date of anticipated recovery of amortized cost.

Beyond the next twelve months, the ability of the operating subsidiaries to declare and pay dividends may be influenced by a variety of factors, including market conditions, general economic conditions and, in the case of the Company’s insurance subsidiaries, insurance regulations and rating agency capital requirements.

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Payments made in settlement of the Company’s obligations arising from its insured portfolio may, and often do, vary significantly from year to year, depending primarily on the frequency and severity of payment defaults and whether the Company chooses to accelerate its payment obligations in order to mitigate future losses.

For example, the Company made substantial claim payments in 2022 and 2024 in connection with the resolution of certain Puerto Rico credits.

For example, the Company made substantial claim payments in 2022 and 2024 in connection with the resolution of certain defaulting Puerto Rico credits.

The Company is continuing its efforts to resolve the one remaining unresolved Puerto Rico insured exposure that is in payment default, PREPA.

The Company had $464 million in insured net par outstanding of PREPA obligations as of December 31, 2025.

For more information, see Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered), and Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles.

The terms of the Company’s credit default swaps (CDS) contracts generally are modified from standard CDS contract forms approved by International Swaps and Derivatives Association, Inc.

For more information, see Item 8.

Financial Statements and Supplementary Data, and Note 4.

Expected Loss to be Paid (Recovered).

The terms of the Company’s credit default swap (CDS) contracts generally are modified from standard CDS contract forms approved by International Swaps and Derivatives Association, Inc.

such that the circumstances giving rise to the Company’s obligation to make loss payments are similar to those for its financial guaranty insurance contracts.

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The following table presents estimated probability weighted expected cash outflows under direct and assumed financial guaranty contracts, whether accounted for as insurance or credit derivatives, including claim payments under contracts in consolidated FG VIEs, as of December 31, 2025.

This amount does not include amounts related to loss adjustment expenses.

This amount is not reduced for cessions under reinsurance contracts or recoveries attributable to Loss Mitigation Securities.

This amount includes any benefit anticipated from excess spread or other recoveries within the contracts but does not reflect any benefit for recoveries under breaches of representation and warranty.

This amount also excludes estimated recoveries for past claims paid for policies in the public finance sector.

Financial Statements and Supplementary Data, Note 5, Contracts Accounted for as Insurance.

This amount is not reduced for cessions under reinsurance contracts.

Financial Statements and Supplementary Data, Note 5.

Contracts Accounted for as Insurance.

Estimated Expected Claim Payments

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1-3 years 566

3-5 years 122

More than 5 years 1,879

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The Company anticipates that, for the next twelve months, amounts paid by AGL’s direct and indirect insurance subsidiaries as dividends or other distributions will be a major source of the holding companies’ liquidity.

The insurance subsidiaries’ ability to pay dividends depends upon their financial condition, results of operations, cash requirements, other potential uses for such funds and compliance with rating agency requirements, and is also subject to restrictions contained in the

insurance laws and related regulations of their states of domicile.

For more information, see Item 8, Financial Statements and Supplementary Data, Note 14, Insurance Company Regulatory Requirements.

For more information, see Item 8.

Financial Statements and Supplementary Data, Note 14.

Insurance Company Regulatory Requirements.

Dividend restrictions by insurance subsidiary are as follows:

• The Company expects the amount of ordinary dividends available for distribution by AG in 2025 to be approximately $287 million.

Such payments would be payable in the second half of 2025 because AG’s ordinary dividends were concentrated in the second half of 2024 following the August 1, 2024 merger of AGM with and into AG.

Under Maryland’s insurance law, AG may make an ordinary dividend payment in 2025 only when such amount, together with other dividends and distributions paid in the prior 12 months, does not exceed its expected 2025 ordinary dividend capacity of $287 million (i.e., a 12-month look back of dividends and distributions).

However, in order to enable AG to make payments over the course of the year, AG has put in place for 2025 a quarterly process with the MIA, pursuant to which AG will confirm that the MIA does not object to AG dividending $71.8 million (i.e., 25%) of the $287 million amount in each calendar quarter of 2025.

Pursuant to this process, AG obtained the MIA’s non-objection to pay, and expects to pay, a $71.8 million dividend on March 7, 2025.

See Part I, Item 1, Business - Regulation, and Part II, Item 7, Management’s Discussion and Analysis of Financial Conditions and Results of Operations – Overview – Key Business Strategies – Merger of the U.S.

Insurance Subsidiaries.

• Under Maryland’s insurance law, AG may, with prior notice to the Commissioner of its domiciliary regulator, the MIA, pay an ordinary dividend in an amount that, together with all dividends and distributions paid in the prior 12 months, does not exceed the lesser of 10% of its policyholders’ surplus (as of the prior December 31) or 100% of its adjusted net investment income during that period.

“Adjusted net investment income” means the sum of (x) AG’s net investment income during the 12-month period ending December 31 of the preceding year (excluding realized capital gains and pro rata distributions of its own securities), and (y) AG’s net investment income (excluding realized capital gains) from the three calendar years prior to the preceding calendar year that has not already been paid out as dividends.

The maximum amount available during 2026 for AG to distribute as ordinary dividends is approximately $245 million of which approximately $29 million is available for distribution in the first quarter of 2026.

• The Company expects the amount of dividends available for distribution by AG Re in 2026 to be approximately $213 million.

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Additionally, in 2026 AG Re can make capital distributions in an aggregate amount up to $129 million without the prior approval of the Authority.

Ordinary Dividends From Insurance Subsidiaries

Ordinary Dividends

From Insurance Company Subsidiaries

to Holding Companies

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(in millions)

Dividends paid by AG Re to AGL 97 53 —

Dividends paid by AG to U.S.

Dividends by AG Re to AGL 80 97 53

Dividends by AG to U.S.

Holding Companies (1) 287 400 358

___________________

(1) Prior to the merger of AGM with and into AG, with AG as the surviving company, AG had been directly owned by AGUS.

As a result of the merger, effective as of August 1, 2024, AG is directly owned by AGMH, a subsidiary of AGUS.

(1) Prior to a reorganization of the Company’s U.S.

corporate structure, AG had been directly owned by AGUS.

As a result of the reorganization, effective as of August 1, 2024, AG is directly owned by AGMH, a subsidiary of AGUS.

Stock Redemptions by Insurance Subsidiaries

In May 2024, NYDFS approved, and AGM implemented, the redemption of approximately $100 million of AGM’s shares of common stock from AGMH.

In connection with the merger of AGM into AG, the MIA approved, and in third quarter of 2024 AG implemented, the redemption of approximately $300 million of AG’s shares of common stock from AGMH in exchange for cash of $167 million and the remainder in alternative investments.

In the third quarter of 2025, after receiving approval from the MIA, AG redeemed $250 million of its common stock from AGMH in exchange for $213 million in cash and $37 million in alternative investments.

Assumed Reinsurance

Some of the Company’s insurance subsidiaries (Assuming Subsidiaries) assumed financial guaranty insurance from legacy financial guarantors.

The agreements under which the Assuming Subsidiaries assumed such business are generally subject to termination at the option of the ceding company (i) if the Assuming Subsidiary fails to meet certain financial and regulatory criteria;

(ii) if the Assuming Subsidiary fails to maintain a specified minimum financial strength rating;

or (iii) upon certain changes of control of the Assuming Subsidiary.

Upon termination due to one of the above events, the Assuming Subsidiary typically would be required to return to the ceding company unearned premiums (net of ceding commissions) and loss reserves, calculated on a U.S.

statutory basis, attributable to the assumed exposure on insured obligations (plus in certain cases, an additional required amount), after which the Assuming Subsidiary would be released from liability with respect to such business.

As of December 31, 2025, if each legacy financial guarantor ceding business to an Assuming Subsidiary had a right to recapture such business, and chose to exercise such right, the aggregate amounts those subsidiaries could be required to pay to all such ceding companies would be approximately $243 million.

In addition, beneficiaries of financial guaranties issued by the Company’s insurance subsidiaries may have the right to cancel the credit protection provided by them, which would result in the loss of future premium earnings and the reversal of any fair value gains recorded by the Company.

Committed Capital Securities

AG is party to an arrangement that enables it to access, at its discretion, up to $400 million of capital, at any time, and has the right to use such capital for any purpose, including to pay claims.

See Item 8, Financial Statements and Supplementary Data, Note 9, Fair Value Measurement.

Financial Statements and Supplementary Data, Note 9.

Fair Value Measurement.

Federal Home Loan Bank Membership

In the fourth quarter of 2025, AG became a member of the Federal Home Loan Bank of New York (FHLBNY), thereby gaining access to collateralized FHLBNY borrowings as an additional source of liquidity.

The Board has authorized a maximum borrowing capacity of $300 million.

As of December 31, 2025, the Company had not borrowed any funds or pledged any collateral under the FHLBNY program.

Investment Portfolio

The Company’s principal objectives in managing its investment portfolio are to support the highest possible ratings for each operating company, manage investment risk within the context of the underlying portfolio of insurance risk, maintain sufficient liquidity to cover unexpected stress in the insurance portfolio and maximize after-tax net investment income.

As of December 31, 2024, the Company had $7,590 million of available-for-sale fixed-maturity and short-term investments, of which

$5,452 million were managed by three investment managers who are required to, in accordance with the Company’s investment guidelines, maintain their portion of the Company’s investment portfolio with an overall credit quality rated at a minimum of A+/A1/A+ by S&P/Moody’s/Fitch Ratings Inc.

As of December 31, 2025, the Company had $6,369 million of available-for-sale fixed-maturity securities, of which $5,640 million were managed by three investment managers who are required to, in accordance with the Company’s investment guidelines, maintain their portion of the Company’s investment portfolio with an overall credit quality rated at a minimum of A+/A1/A+ by S&P/Moody’s/Fitch Ratings, Inc.

In addition, $228 million of available-for-sale fixed-maturity securities were CLO equity tranches managed by Sound Point.

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Other invested assets include other alternative investments, which are generally less liquid.

For more information about the investment portfolio and a detailed description of the Company’s valuation of investments, see Item 8, Financial Statements and Supplementary Data, Note 7, Investments and Cash, and Note 9, Fair Value Measurement.

For more information about the investment portfolio and a detailed description of the Company’s valuation of investments, see Item 8.

Financial Statements and Supplementary Data, Note 7.

Investments and Cash, and Note 9.

Fair Value Measurement.

Investment Portfolio

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____________________

(1) Includes primarily CVIs received under the 2022 Puerto Rico Resolutions, which are not rated.

(1) Includes primarily CVIs received as part of resolutions of Puerto Rico exposures in 2022, which are not rated.

(2) Excludes investments in Sound Point funds that are consolidated.

See Item 8, Financial Statements and Supplementary Data, Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles.

Financial Statements and Supplementary Data, Note 8.

Variable Interest Entities.

The Company’s available-for-sale fixed-maturity securities had a duration of 4.9 years as of December 31, 2025 and 4.3 years as of December 31, 2024, respectively.

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The following table summarizes the ratings distributions of the Company’s available-for-sale fixed-maturity securities as of December 31, 2025 and December 31, 2024.

Ratings generally reflect the lower of Moody’s and S&P classifications, except for (i) Loss Mitigation Securities, which use Assured Guaranty’s internal ratings classifications, rated BIG, and (ii) CLO equity tranches, which are not rated.

See Item 8, Financial Statements and Supplementary Data, Note 7, Investments and Cash, for additional information.

Ratings generally reflect the lower of Moody’s and S&P classifications, except for (i) Loss Mitigation Securities rated BIG and (ii) CLO equity tranches, which are not rated.

Financial Statements and Supplementary Data, Note 7.

Investments and Cash, for additional information.

Distribution of Available-for-Sale Fixed-Maturity Securities by Rating

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As of December 31, 2025 (1)

Obligation Local

State General

Obligation Revenue Bonds Total Fair

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New York 29 148 177 179

Massachusetts 43 — 60 103 107

Florida 1 96 97 101

Washington 24 53 77 81

Massachusetts 25 52 77 79

Illinois 20 50 70 72

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Pennsylvania 9 38 47 47

Arizona — — 43 43 44

Georgia 10 31 41 43

All others 119 358 477 496

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(in millions)

Tax revenue $ 374 $ 369

Transportation $ 386 $ 378

Utilities 280 270

Tax revenue 360 366

Education 215 212

Utilities 188 181

Healthcare 87 83

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Other invested assets, which are generally less liquid than fixed-maturity securities, primarily consist of the ownership interest in Sound Point and alternative investments across a variety of strategies.

The Insurance segment reports the Company’s percentage ownership of Sound Point funds and AHP funds as equity method investments with changes in NAV included in the Insurance segment adjusted operating income.

As of December 31, 2024, one active fund in which the Company invests was accounted for as a CIV and the remaining are accounted as equity method investments in the Company’s consolidated financial statements.

See “— Commitments” below.

Ownership Interest in Sound Point and Alternative Investments

As of December 31, 2024

Investments CIVs Consolidated

Sound Point and Alternative Investments

As of December 31, 2025 (1) As of December 31, 2024

Investments CIVs Consolidated Investments CIVs Consolidated

(in millions)

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Asset-based/specialty finance 184 (57) 127 142 (33) 109

Middle market direct lending 11 — 11

Private minority stakes in alternative asset manager 95 — 95 69 — 69

Commercial real estate finance 81 — 81 — — —

Other 101 — 101 77 — 77

Total $ 1,302 $ (33) $ 1,269

Subtotal $ 1,440 $ (57) $ 1,383 $ 1,302 $ (33) $ 1,269

Assets of CIVs, net of non-redeemable NCI $ — $ 77 $ 77 $ — $ 43 $ 43

____________________

(1) Include CLO equity tranches distributed from the CLO fund in the fourth quarter of 2024.

Ownership Interest in Sound Point and Alternative Investments

As of December 31, 2023

Investments CIVs Consolidated

(in millions)

Fixed-maturity securities, available-for-sale $ 34 $ — $ 34

Other invested assets:

Sound Point 429 — 429

CLOs 302 (223) 79

Private healthcare investing 102 — 102

Asset-based/specialty finance 166 (82) 84

Middle market direct lending 5 — 5

Other 130 — 130

Total $ 1,168 $ (305) $ 863

Income from Ownership Interest in Sound Point and Alternative Investments

(1) The alternative investments, which do not include the Company’s ownership interest in Sound Point, had an inception-to-date annualized internal rate of return of 13%.

Effect of Ownership Interest in Sound Point and Alternative Investments

on Consolidated Statements of Operations (1)

Year Ended December 31, 2025

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Net investment income (2) $ 46 $ — $ 46

Net realized investment gains (losses) (19) — (19)

Fair value gains (losses) on trading securities 2 — 2

Equity in earnings of Sound Point 6 — 6

Equity in earnings (losses) of alternative investments:

CLOs 47 (33) 14

Equity in earnings (losses) of investees:

Ownership interest in Sound Point 14 — 14

Alternative investments:

Private healthcare investing 22 — 22

Asset-based/specialty finance 35 (23) 12

Middle market direct lending 2 — 2

Private minority stakes in alternative asset manager 38 — 38

Commercial real estate finance 1 — 1

Other 14 — 14

Total $ 126 $ (47) $ 79

Equity in earnings (losses) of investees 125 (23) 102

Subtotal $ 154 $ (23) $ 131

Fair value gains (losses) on CIVs, net of NCI $ — $ 39 $ 39

____________________

(1) Includes CLO equity tranches distributed from the CLO fund in the fourth quarter of 2024.

Income from Ownership Interest in Sound Point and Alternative Investments

(1) Foreign exchange gains on remeasurement of alternative investments were $1 million for 2025.

(2) Includes CLO equity tranches distributed from a CLO fund in the fourth quarter of 2024.

Effect of Ownership Interest in Sound Point and Alternative Investments

on Consolidated Statements of Operations

Year Ended December 31, 2024

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Net investment income (1) $ 15 $ — $ 15

Equity in earnings of Sound Point 5 — 5

Equity in earnings (losses) of alternative investments:

Net realized investment gains (losses) — — —

Fair value gains (losses) on trading securities 2 — 2

Equity in earnings (losses) of investees:

Ownership interest in Sound Point 6 — 6

Alternative investments:

CLOs 47 (33) 14

1 unchanged sentence

Asset-based/specialty finance 24 (14) 10

Total $ 88 $ (59) $ 29

Income from Alternative Investments

Private minority stakes in alternative asset manager 21 — 21

Equity in earnings (losses) of investees 109 (47) 62

Subtotal $ 126 $ (47) $ 79

Fair value gains (losses) on CIVs, net of NCI $ — $ 53 $ 53

____________________

(1) Includes CLO equity tranches distributed from the CLO fund in the fourth quarter of 2024.

Effect of Ownership Interest in Sound Point and Alternative Investments

on Consolidated Statements of Operations

Year Ended December 31, 2023

1 unchanged sentence

(in millions)

Equity in earnings (losses) of alternative investments:

Net investment income $ 1 $ — $ 1

Net realized investment gains (losses) — — —

Fair value gains (losses) on trading securities — — —

Equity in earnings (losses) of investees:

Ownership interest in Sound Point 5 — 5

Alternative investments:

CLOs 50 (46) 4

1 unchanged sentence

Asset-based/specialty finance 5 (4) 1

Other (43) 2 (41)

Total $ (51) $ 12 $ (39)

Beginning in the third quarter of 2023, the Company records an equity method ownership interest in Sound Point pursuant to the Sound Point Transaction described in Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation.

The Company has agreed to invest an aggregate amount of $1.5 billion in alternative investments, including $1 billion in Sound Point managed investments.

Private minority stakes in alternative asset manager 2 — 2

Equity in earnings (losses) of investees 87 (59) 28

Subtotal $ 88 $ (59) $ 29

Fair value gains (losses) on CIVs, net of noncontrolling interests $ — $ 66 $ 66

The Company has agreed to invest an aggregate amount of $1.5 billion in alternative investments, which includes $1 billion in Sound Point managed investments, subject to certain conditions precedent.

Unfunded commitments for alternative investments as of December 31, 2025 were $490 million.

See Part II, Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation, for a description of the Sound Point Transaction.

Financial Statements and Supplementary Data, Note 7.

Investments and Cash, for a description of the alternative investments agreement with Sound Point.

Restricted Assets

Based on fair value, fixed-maturity securities, short-term investments and cash that are either held in trust for the benefit of third-party ceding insurers in accordance with statutory requirements, placed on deposit to fulfill state licensing requirements, or otherwise pledged or restricted, totaled $77 million and $79 million as of December 31, 2025 and December 31, 2024, respectively.

The investment portfolio also contains securities that are held in trust by certain AGL subsidiaries or otherwise restricted for the benefit of other AGL subsidiaries in accordance with statutory and regulatory requirements with a fair value of $1,135 million and $1,154 million as of December 31, 2024 and December 31, 2023, respectively.

In addition, the total collateral funded into a reinsurance trust or a similar account by certain AGL subsidiaries or is otherwise restricted for the benefit of other AGL subsidiaries in accordance with statutory and regulatory requirements had a fair value of $813 million and $1,135 million as of December 31, 2025 and December 31, 2024, respectively.

Lease Obligations

The Company has entered into several lease agreements for office space in Bermuda, New York, London, Paris, and other locations with various lease terms.

See Item 8, Financial Statements and Supplementary Data, Note 16, Leases, for a table of minimum lease obligations.

Financial Statements and Supplementary Data, Note 16.

Leases, for a table of minimum lease obligations.

FG VIEs and CIVs

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The insurance subsidiaries are not primarily liable for the debt obligations issued by the VIEs they insure and would only be required to make payments on those insured debt obligations in the event that the issuer of such debt obligations defaults on any principal or interest due and only for the amount of the shortfall.

AGL’s and its insurance subsidiaries’ creditors do not have any rights with regard to the collateral supporting the debt issued by the FG VIEs.

The primary sources and uses of cash in the CIVs include, using capital to make investments, generating cash income from investments, paying expenses, distributing cash flow to investors.

AGL’s and its

insurance subsidiaries’ creditors do not have any rights with regard to the collateral supporting the debt issued by the FG VIEs.

The primary sources and uses of cash in the CIVs include using capital to make investments generating cash income from investments, paying expenses and distributing cash flow to investors.

The assets and liabilities of the Company’s CIVs are held within separate legal entities.

2 unchanged sentences

Liquidity available at the Company’s CIVs is not available for corporate liquidity needs, except to the extent of the Company’s investment in the funds, subject to redemption provisions.

See Item 8, Financial Statements and Supplementary Data, Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles, for additional information.

Financial Statements and Supplementary Data, Note 8.

Variable Interest Entities, for additional information.

Consolidated Cash Flow Summary

The summarized consolidated statements of cash flows in the table below present the cash flow effect for the aggregate of the Insurance and Asset Management businesses and holding companies, separately from the aggregate effect of consolidating FG VIEs and CIVs.

The summarized consolidated statements of cash flows in the table below present the cash flow effect for the aggregate of the Insurance and Asset Management segments and Corporate division, separately from the aggregate effect of consolidating FG VIEs and CIVs.

In the third quarter of 2023, as a result of the Sound Point Transaction and AHP Transaction, the Company deconsolidated all CLOs and CLO warehouses and certain funds.

Therefore, beginning July 1, 2023, the Company’s cash flow statements no longer include all the operating, investing and financing cash flow activity of those deconsolidated CIVs.

See Item 8, Financial Statements and Supplementary Data, Note 1, Business and Basis of Presentation, and Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles, for additional information.

Financial Statements and Supplementary Data, Note 1.

Business and Basis of Presentation, and Note 8.

Variable Interest Entities, for additional information.

Summarized Consolidated Cash Flows

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Net cash flows provided by (used in) financing activities (1) (616) (983) (670)

Effect of exchange rate changes, excluding FG VIEs and CIVs (2) 2 (3)

Effect of exchange rate changes for FG VIEs and CIVs — — (5)

Effect of exchange rate changes 7 (2) 2

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Cash flows from operating activities were inflows of $259 million in 2025 and $47 million in 2024.

The decrease in cash inflows during 2024 was primarily due to a $457 million decrease in net cash flows from CIVs, most of which were deconsolidated in 2023 as a result of the Sound Point Transaction, an $86 million increase in tax payments, a $56 million increase in net claim payments, which were partially offset by a $93 million increase in premiums received, a $40 million increase in return on capital from equity method investees, and Sound Point Transaction and AHP Transaction expenses in 2023.

The 2025 cash flow from operations includes the receipt of $103 million in satisfaction of the judgment the Company was awarded and its recoveries in connection with the resolution of the LBIE litigation.

In addition, 2025 cash flows from operations were higher than in 2024 due to a $114 million decrease in net claim payments.

Investing activities primarily consisted of net sales (purchases) of fixed-maturity securities and short-term investments and paydowns on, and sales of, FG VIEs’ assets.

The increase in investing cash inflows in 2024 compared with 2023 was mainly attributable to net purchases of short-term and fixed-maturity securities in 2023, higher sales of CVIs in 2024 and lower net sales of fixed-maturity securities in 2024.

Investing inflows in both periods were used to fund claim payments and share repurchases.

See Item 8, Financial Statements and Supplementary Data, Note 4, Expected Loss to be Paid (Recovered), for additional information.

Financing activities primarily consist of (i) AGL share repurchases and dividends, (ii) paydowns of FG VIEs’ liabilities, and (iii) until July 1, 2023, CLO issuances and CLO warehouse financing activities.

The decrease in investing cash inflows compared with the prior year is primarily due to the need for liquidity to fund higher claim payments in 2024.

In addition, increased operating cash flows in 2025, due in part to the cash inflow related to the resolution of the LBIE litigation, reduced the need to liquidate investments.

Financial Statements and Supplementary Data, Note 4.

Expected Loss to be Paid (Recovered), for additional information.

Financing activities primarily consist of (i) AGL share repurchases and dividends, and (ii) paydowns of FG VIEs’ liabilities.

In 2024, FG VIEs’ financing cash flows were $375 million, which primarily related to the paydown of Puerto Rico Trust liabilities.

The CIVs’ financing cash flows in 2023 included repayments of CLO warehouse financing debt of $166 million and distributions from noncontrolling interests to CIVs.

See Item 8, Financial Statements and Supplementary Data, Note 8, Financial Guaranty Variable Interest Entities and Consolidated Investment Vehicles.

From January 1, 2026 through February 25, 2026, the Company repurchased an additional 546 thousand common shares.

As of February 27, 2025, the Company was authorized to purchase approximately $276 million of its common shares.

For more information about the Company’s share repurchases and authorizations, see Item 8, Financial Statements and Supplementary Data, Note 18, Shareholders’ Equity.

As of February 25, 2026, the Company was authorized to purchase $204 million of its common shares.

For more information about the Company’s share repurchases and authorizations, see Item 8.

Financial Statements and Supplementary Data, Note 18.

Shareholders’ Equity.

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What changed 10-K

Item 7. Management’s Discussion and Analysis