Syncora Holdings Ltd. Announces Statutory Financial Results for First Quarter 2016

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May 12, 2016, 04:38 ET

HAMILTON, Bermuda, May 12, 2016 /PRNewswire/ -- Syncora Holdings Ltd. ("SHL" or the "Company") and its wholly-owned subsidiaries, Syncora Guarantee Inc. ("SGI") and Syncora Capital Assurance Inc. ("SCAI"), today provided statutory financial results for SGI and SCAI for the quarter ended March 31, 2016.

As of March 31, 2016, SGI's policyholders' surplus remained largely unchanged compared to December 31, 2015 with adverse loss development to Puerto Rico-related exposures being offset by reserve releases in RMBS credits. For SCAI, policyholders' surplus decreased as compared to prior year-end, primarily as a result of adverse loss developments on its Puerto Rico-related exposures. Updated information on SGI and SCAI's Puerto Rico-related exposures can be found in their first quarter 2016 Operating Supplement. Although SCAI and Puerto Rico Electric Power Authority ("PREPA") continue to negotiate in good faith to reach agreement with respect to SCAI's participation in PREPA's recovery plan, no agreement has been, or may ultimately be reached.

The Company continues to actively pursue its strategic initiatives to increase value for Company stakeholders and continues to engage in discussions with certain stakeholders and the New York Department of Financial Services. In addition, the Company reaffirmed its plans to hold an investor call in the second quarter of 2016.

Financial Highlights

The Company has posted on its website at www.syncora.com, Statutory Quarterly Statements as of March 31, 2016 and the first quarter 2016 Operating Supplement for its subsidiaries, SGI and SCAI. Highlights of SGI's and SCAI's statutory financial results as of March 31, 2016 are as follows:

SGI

SGI's policyholders' surplus increased by $1.6 million from $1,086.9 million as of December 31, 2015 to $1,088.5 million as of March 31, 2016. The increase was due to positive net income during the quarter, partially offset by a lower investment in SCAI as a result of the subsidiary's lower policyholders' surplus position.

SGI's net income for the three months ended March 31, 2016 was $8.4 million. Net income was primarily attributable to net investment income of $7.0 million, partially offset by net underwriting losses of $2.2 million. Included in net underwriting losses is a $2.8 million benefit primarily from RMBS reserve releases and improved recoveries on certain other loss exposures, offset by adverse Puerto Rico developments as discussed above.

As of March 31, 2016, SGI had $6.5 billion and $1.5 billion in net par outstanding and claims-paying resources, respectively, as compared to $6.6 billion and $1.5 billion as of December 31, 2015, respectively.

SCAI

SCAI's policyholders' surplus decreased by $7.6 million from $192.1 million as of December 31, 2015 to $184.5 million as of March 31, 2016. The decrease was primarily due to a net loss during the quarter, partially offset by lower contingency reserves as a result of the continued run-off of the insured portfolio and refundings.

SCAI's net loss for the three months ended March 31, 2016 was $11.8 million. Net loss was mainly due to adverse loss developments on SCAI's exposures to Puerto Rico, offset by earned premium primarily as a result of refunding activity during the quarter. Total premium accelerations for SCAI were $6.1 million for the three months ended March 31, 2016 as a result of refundings and the Company's remediation activities.

As of March 31, 2016, SCAI had $20.6 billion and $587.9 million in net par outstanding and claims-paying resources, respectively, as compared to $21.7 billion and $599.2 million as of December 31, 2015, respectively.


Statutory Balance Sheets
As of March 31, 2016 and December 31, 2015
			Syncora Guarantee Inc.		Syncora Capital Assurance Inc.
($ In Thousands)			2016	2015	2016	2015

Admitted Assets
	Bonds		$ 939,570	$ 872,251	$ 354,625	$ 363,341
	Common stocks		-	-	21,388	18,390
	Preferred stocks		-	-	2,629	2,599
	Cash, cash equivalents and short-term		78,640	138,547	71,986	72,960
	Derivatives		97	521	-	-
	Other invested assets		225,048	229,094	8,687	5,449
		Total cash and invested assets	1,243,355	1,240,412	459,315	462,738
	Investment income due and accrued		3,151	2,930	2,523	2,190
	Net uncollected premiums and reinsurance assets		844	1,461	995	1,134
	Other assets		4,290	4,643	2,756	2,843
Total Admitted Assets			$ 1,251,640	$ 1,249,446	$ 465,588	$ 468,905

Liabilities, Surplus and Other Funds
	Losses and loss adjustment expenses		$ (48,441)	$ (45,406)	$ 52,918	$ 40,622
	Unearned premium revenue, net		110,342	111,061	155,983	163,483
	Contingency reserves		86,776	85,147	57,612	62,253
	Other liabilities		14,420	11,688	14,563	10,440
Total Liabilities			163,097	162,489	281,075	276,798

Capital and Surplus
	Common capital stock		15,000	15,000	2,500	2,500
	Preferred capital stock		200,000	200,000	-	-
	Surplus notes		584,334	584,334	200,000	200,000
	Gross paid-in and contributed surplus		2,046,972	2,046,972	219,000	219,000
	Unassigned funds		(1,757,763)	(1,759,349)	(236,987)	(229,393)
Surplus as Regards Policyholders			1,088,544	1,086,957	184,514	192,108
Total Liabilities, Surplus and Other Funds			$ 1,251,640	$ 1,249,446	$ 465,588	$ 468,905


Statutory Income Statements
For the three months ended March 31, 2016 and 2015
			Syncora Guarantee Inc.		Syncora Capital Assurance Inc.
($ In Thousands)			2016	2015	2016	2015

Underwriting Income
	Net premiums earned		$ 3,246	$ 8,077	$ 11,212	$ 9,141
	Net losses (benefit) and loss adjustment expenses		(752)	14,237	13,663	1,436
	Other underwriting expenses incurred		6,233	8,512	6,528	5,613
		Net underwriting gain (loss)	(2,236)	(14,672)	(8,979)	2,093

Investment Income
	Net investment income		7,032	6,561	4,182	3,828
	Net realized gain (loss)		732	816	(4,098)	2,678
		Net investment gain (loss)	7,764	7,376	83	6,505

Other Income
	Other income		11	75	7	129
Pre-Tax Income			5,539	(7,220)	(8,889)	8,726

Federal and foreign income taxes (benefit) incurred			(2,887)	(1,027)	2,950	1,995

Net Income (Loss)			$ 8,426	$ (6,193)	$ (11,839)	$ 6,732

About Syncora Holdings Ltd.

Syncora Holdings Ltd. (OTC: SYCRF) is a Bermuda-domiciled holding company. Syncora Guarantee Inc. and Syncora Capital Assurance Inc. are wholly-owned subsidiaries of Syncora Holdings Ltd. Further information can be found on www.syncora.com

Contact
Michael Corbally
Syncora Holdings Ltd.
1 212 478 3400
[email protected]

Forward Looking Statements

This 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 the Company's control. These risks and uncertainties include, but are not limited to, the factors described in the Company's historical filing with the New York Department of Financial Services, and in the Company's, Syncora Guarantee Inc.'s and Syncora Capital Assurance Inc.'s GAAP and statutory financial statements posted on its website at www.syncora.com. Readers are cautioned not to place undue reliance on forward-looking statements which speak only as of the date they are made. The Company 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.

SOURCE Syncora Holdings Ltd.