TIDM80UC TIDM12FC TIDM57AJ TIDM77WS
RNS Number : 7522Y
Syncora Guarantee Inc.
17 May 2021
NEWS RELEASE www.syncoraguarantee.com
17 May 2021
SYNCORA GUARANTEE INC.
LEI 5493005UM1WMYHSO3P68
STATUTORY BASIS FINANCIAL STATEMENTS AS OF MARCH 31, 2021
(the "March 2021 Financial Statements")
Syncora Guarantee Inc. ("Syncora Guarantee" or the "Company"),
an insurance company domiciled in the State of New York, announced
its results for the quarter ended March 31, 2021. The statutory
financial statements of Syncora Guarantee comprise the statutory
statements of admitted assets, liabilities and capital and surplus
as of March 31, 2021, and the related statutory statements of
operations and changes in capital and surplus, and of cash flows
for the quarter then ended.
Strategy
The March 2021 Financial Statements set out a "Description of
Significant Risks and Uncertainties, and Description of Syncora
Guarantee's On-Going Strategic Plan". Such descriptions include but
are not limited to the following -
Risks related to Sale of the Company and Strategy
On December 30, 2019, Syncora Holdings Ltd. ("Syncora Holdings")
and its subsidiary, Syncora Holdings US Inc., sold their entire
ownership interest in Syncora Guarantee to Syncora FinanceCo LLC.,
formerly known as Star Insurance Holdings LLC ("Syncora
FinanceCo"), an entity organized by GoldenTree Asset Management LP
("GoldenTree") on behalf of GoldenTree's managed funds and
accounts. Upon sale, the Company retained certain of its employees
in an effort to provide a smooth transition to its new ownership
structure.
Syncora Guarantee's parent, Syncora FinanceCo, is a holding
company with no independent operations or assets and is dependent
on dividends from Syncora Guarantee, if any, to fund its liquidity
needs. Syncora FinanceCo has advised Syncora Guarantee that it may
request that Syncora Guarantee pay one or more dividends for this
purpose in the future. Syncora Guarantee's ability to pay any
dividend would be subject to compliance with applicable legal and
other requirements, including any required approval of the New York
Department of Financial Services (the "NYDFS").
Furthermore, Syncora Guarantee continues to pursue certain key
strategic initiatives in order to continue to deliver enhanced
value to stakeholders. These initiatives include (i) actively and
continuously focusing on reducing the Company's retained insured
exposures (through their purchase on the open market or otherwise,
commutation, defeasance, reinsurance or other restructuring) to
minimize potential claim payments, maximize recoveries and mitigate
potential losses, some of which may result in a material decrease
in our retained exposure, if consummated, including one reinsurance
transaction that was executed in January 2021, which further
reduced the Company's net par outstanding significantly, (ii)
seeking to realize the maximum value of its assets, and from any
other rights and remedies the Company may have, (iii) seeking to
novate or, itself or its affiliates, purchase with a view towards
novating to Assured Guaranty Corp. ("Assured Guaranty"), the
policies reinsured to Assured Guaranty that have not yet been
novated to Assured Guaranty as of March 31, 2021(1) , which
novation may lead to a change in the credit ratings of the related
securities, (iv) further reducing operating expenses and improving
operational efficiencies, and (v) transitioning services to Assured
Guaranty in respect of the reinsurance agreement and the
administrative services agreement.
Any or all of these actions may be outside the ordinary course
of the Company's operations or its control and may require
consents, approvals or cooperation of third parties, including the
NYDFS, and there can be no assurance that any such consents,
approvals or cooperation will be obtained on a timely basis or at
all. In addition, while the parties in the reinsurance transaction
agreed to use commercially reasonable efforts to cooperate on
novations for three years after the closing date, such three-year
period ends on June 1, 2021.
Notes:
(1) On June 1, 2018, Syncora Guarantee closed the reinsurance
transaction with Assured Guaranty pursuant to which Assured
Guaranty agreed to provide reinsurance, general on a 100%
quota share basis, to Syncora Guarantee of approximately
$12.1 billion of net par outstanding of Syncora Guarantee
insured financial guaranty insurance policies, representing
approximately 92% of Syncora Guarantee's outstanding insured
exposure as of June 30, 2018.
See Notes 1 and 21 of the March 2021 Financial Statements
for further discussion. Reinsurance does not relieve a primary
insurance company of its obligations under an insurance policy.
While Assured Guaranty has a contractual obligation to Syncora
Guarantee pursuant to the reinsurance agreement and administrative
services agreement to administer and pay claims on the financial
guaranty insurance policy, Assured Guaranty has no direct
obligations to any beneficiary or holder of the financial
guaranty insurance policy. Accordingly, Assured Guaranty's
financial strength ratings will not be conferred on such
policy.
The March 2021 Financial Statements, certain other financial
information of Syncora Guarantee, and a list of bonds that are
listed on stock exchanges in the United Kingdom or European
Economic Area in respect of which Syncora Guarantee has provided a
primary or secondary financial guarantee or insurance policy and
may apply its strategic initiatives, are available on Syncora
Guarantee's website www.syncoraguarantee.com.
For further information, please contact:
Syncora Guarantee Inc.
Mary Jane Constant
+1.212.478.3456
Maryjane.constant@scafg.com
Important Information and Forward Looking Statements
This press release contains statements about future results,
plans and events that may constitute "forward-looking" statements.
We caution you that the forward-looking information presented in
this press release is not a guarantee of future events, and that
actual events may differ materially from those made in or suggested
by the forward-looking information contained in this press release.
In addition, forward-looking statements generally can be identified
by the use of forward-looking terminology such as "may," "plan,"
"seek," "comfortable with," "will," "expect," "intend," "estimate,"
"anticipate," "believe" or "continue" or the negative thereof or
variations thereon or similar terminology. Forward-looking
statements are subject to a number of risks and uncertainties, many
of which are beyond Syncora Guarantee's control. Readers are
cautioned not to place undue reliance on forward-looking statements
which speak only as of the date they are made. Syncora Guarantee
does not undertake to update forward-looking statements to reflect
the impact of circumstances or events that arise after the date the
forward-looking statements are made.
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