Open an Account

1-800-FMS-BOND

1-800-367-2663

1-800-FMS-BOND

1-800-367-2663

Vote of Confidence for Bond Insurers

Klotz on Bonds

Home > News and Perspectives > Vote of Confidence for Bond Insurers

<h3>James A. Klotz</h3>

James A. Klotz

Assured Guaranty (AGM) and National Public Finance Guarantee were upgraded by Standard & Poor’s yesterday afternoon.

National was raised to AA- from A with a stable outlook.

S&P said “the stable outlook on National reflects our expectation that National will gain market acceptance and become a competitive financial guarantor.”

The rating upgrade is based on S&P’s view of the company’s prospective strong business risk profile and its current extremely strong capital adequacy position.

AGM was raised from AA- to AA which means it now enjoys the same rating as Build America Mutual (BAM), the only other municipal bond insurer actively writing new business since the financial crises in 2008.

According to S&P, the AGM upgrade reflects its view that “AGM’s competitive position remains strong, relative to its peers, in the bond insurance industry.

These upgrades along with Moody’s affirming both insurers’ ratings, with a stable outlook, are a welcome sign to muni investors.

James A. Klotz is the President of FMSbonds, Inc.
Email the Author

Mar 19, 2014

Please note that all investing entails risk. Fixed income securities are subject to risks that will affect their value prior to maturity. Some of these risks can be related to changes in market conditions, issuer creditworthiness, and interest rates. This commentary is not a recommendation to buy or sell a specific security. All references to tax-free income refer to U.S. federal income tax. Income earned by certain investors may be subject to the Alternative Minimum Tax (AMT), and or taxation by state and local authorities. Please consult with your tax professional prior to investing. For more information on these topics please click on the “Bond Basics” link below or search by keyword at the top of this page.