Build America Mutual Assurance Company (BAM or the Company), the first mutual municipal bond insurer, today announced its U.S. municipal insured par of public finance new issuance for the first quarter. BAM guaranteed 114 primary transactions for a total of $866.5 million of new issue volume in the first quarter. Since inception in July 2012 through the first quarter of 2013, BAM has insured 118 new issue municipals with a par amount of $898.5 million.
“We were particularly gratified that our market share of insured new issues grew substantially over the quarter, from 20% in January to 53% in February and March, and we continue to see inquiry from a variety of newly licensed states where BAM is now qualified to do business,” said Seán W. McCarthy, co-founder of BAM. BAM is now licensed in 37 states and the District of Columbia, and the Company expects to achieve nationwide licensing over the next few months.
BAM, which is operated for the benefit of its issuer members — the cities, states and other municipal entities that use its AA/Stable rated financial guaranty — is chartered to insure essential public purpose municipal issuers of fixed rate debt in core sectors. These are primarily G.O., general fund and appropriation bonds; utility and transportation revenue bonds, public colleges and universities and dedicated tax revenue bonds.
BAM’s market focus will remain on small to medium size municipal issuers, which use its guaranty to lower their interest costs and achieve greater market access. BAM’s average transaction size during the first quarter was $7.6 million, with a minimum size of $1.0 million and a maximum size of $52.7 million.
About BAM
Domiciled in New York, BAM is a mutual monoline insurer of municipal bonds, exclusively. BAM is rated AA/Stable by Standard & Poor’s Ratings Services and is sponsored by the National League of Cities.
For further information, please contact:
Betsy Castenir, Head of Corporate Communications 212-257-6148 or 917-940-2462

Build America Mutual Assurance Company (BAM or the Company), the first mutual municipal bond insurer, today announced that it has hired Jill Schmidt as Vice President, Public Finance, East Region. She joins BAM from Assured Guaranty, where she was a Vice President in Public Finance. She reports to Don Farrell, Head of BAM’s Eastern Regional Public Finance Group.
Mr. Farrell said: “We are looking forward to working with Jill. She brings extensive experience in credit underwriting across a variety of sectors, as well as a specialization in public power credits.”
“I am excited about this opportunity. I believe that BAM’s mutual business model brings many advantages to issuers and investors, and I am delighted to be a part of this new and improved kind of bond insurer.”
Ms. Schmidt joined Assured Guaranty in June of 2010 from Fitch, where she was a Director in the Global Power Group. Prior to that, she spent five years at FGIC, where she was a Vice President, Surveillance. Before that, she was a research analyst at Moody’s Investors Service, Inc.
She is a graduate of Clarkson University and holds a Master’s Degree in Business Administration from Baruch College. She is a member of the Municipal Analysts Group of New York, the National Federation of Municipal Analysts and Women in Public Finance.
About BAM
Domiciled in New York, BAM is a mutual monoline insurer of municipal bonds, exclusively. As a mutual bond insurance company, BAM is operated for the benefit of its members—the cities, states and other municipal entities—that use BAM’s financial guaranty to lower their cost of borrowing. BAM is rated AA/Stable by Standard & Poor’s Ratings Services and is sponsored by the National League of Cities.
For further information, please contact:
Betsy Castenir, Head of Corporate Communications, 212-257-6148

Daniel Keating, a veteran leader in the municipal bond market, will join Build America Mutual as Senior Managing Director, Municipal Markets, effective immediately, the company announced today. In this role, Mr. Keating will utilize his extensive experience in all aspects of the municipal market. He will work with BAM’s Capital Markets and Public Finance departments to identify new opportunities for the company to use its AA/Stable-rated financial guaranty to enhance municipal market liquidity.
“Dan Keating has extensive experience and deep knowledge of the intricacies of the municipal market and the people who make it work every day, which makes him uniquely qualified to help us further our mission of building BAM into a municipal market utility serving issuers, dealers, and investors,” said Seán W. McCarthy, BAM’s Chief Executive Officer. “We are thrilled to have him join our team.”
Mr. Keating’s career in municipal finance spans more than 35 years. He was most recently the Chief Operating Officer for Samuel A. Ramirez & Co., and previously spent most of his career at Bear Stearns & Co., where he managed all of the firm’s tax- exempt products. In addition to his professional achievements, Mr. Keating served as a member of the board of the Securities Industry and Financial Markets Association and was chairman of the Municipal Securities Rulemaking Board in 2001.
“I’ve always believed that you build a business around strong people, and I am incredibly impressed with the energy the people at BAM bring to delivering a good product and focusing on the needs of their clients,” said Mr. Keating. “I am looking forward to joining them and helping the company build on its impressive success to date.”
About Build America Mutual
BAM is a mutual bond insurance company operated for the benefit of its members – the cities, states and other municipal entities that use BAM’s financial guaranty to lower their cost of borrowing. BAM is sponsored by the National League of Cities. Through September 30, BAM has written more than 1,200 policies, insuring more than $10.3 billion of municipal securities, and guaranteed more than half of all insured new-issue bond sales in 2014. The present value of the savings it has delivered to issuers exceeds $100 million. Learn more at https://live-bambondscom.pantheonsite.io/about-bam/
For more information, please contact:
Michael Stanton, Head of Corporate Strategy and Communications 212-235-2575; mstanton@buildamerica.com

Build America Mutual Assurance Company (BAM) is pleased to announce that the National Association of Insurance Commissioners (NAIC) has accepted BAM’s request for a coordinated insurance company licensing application review under its Review of Electronic Application Coordination and Processing (REACAP) Project.
“We believe that the NAIC’s coordination of the licensing process will greatly enhance the efficiency and timeliness of securing nationwide licenses,” said Michael J. Moriarty, Head of Regulatory Oversight and Compliance for BAM. BAM, which is licensed in the State of New York, has submitted applications for licenses in all states.
Applications that are accepted into the REACAP program will have the timing, technology and substantive processing of the application review monitored by the National Treatment and Coordination Working Group, which is the NAIC group charged with overseeing the REACAP project. BAM has committed to offering financial guaranty insurance on U.S. municipal bonds nationwide, to file its licensing applications electronically, and to work with the states and the Working Group during the application review process.
In applying for admission to the program, BAM outlined for the Working Group’s consideration the national and regional market need for financial guaranty insurance to lower the cost of financing essential public infrastructure (particularly for smaller and less frequent issuers), the lack of capacity in the current marketplace, BAM’s unique public/private partnership, its robust financial condition as evidenced by the AA rating from Standard & Poor’s, and the deep experience of BAM’s management team in the municipal financial guaranty industry.
Domiciled in New York, Build America Mutual Assurance Company is a mutual bond insurer of essential public purpose U.S. municipal bonds, exclusively. Our members are the cities, states and other municipal agencies issuing bonds with Build America Mutual’s guaranty to lower their cost of borrowing. BAM, which is licensed in the State of New York, is permitted to write business in many jurisdictions throughout the United States. BAM is not yet authorized to do business in California and certain other states. BAM’s website address is www.BuildAmerica.com.

BAM’s competitive position is very strong due to its low-risk business profile that focuses on insuring municipal bonds. We have assigned a financial strength rating of ‘AA’ and a stable outlook. We believe the company will have very strong market penetration. We expect BAM to have an extremely strong capital-adequacy ratio at incorporation and during the first five years of its operation.

• Competitive position profile demonstrated by its market acceptance and risk-adjusted pricing
• Specific focus on high-credit-quality and lower-risk-weighted municipal obligation categories to offset the challenging municipal yield dynamics
• Capital adequacy well above the ‘AAA’ bond insurance capital requirements, even during stress periods
Weaknesses:
• Start-up fixed-cost nature of operations will result in weak operating performance metrics in the near term
• Insured par growth prospects and risk-adjusted profitability depend on municipal market-yield dynamics and
competitive forces

Build America Mutual Assurance Company (“BAM”) today launched the financial guaranty industry’s first mutual bond insurer. Rated AA/Stable by Standard & Poor’s Ratings Services (S&P) and regulated by the New York State Department of Financial Services, BAM is chartered to serve the U.S. municipal market. BAM’s doors are open for business, and it is actively considering transactions. BAM expects to write its first policy in September.
BAM is led by co-founders Robert P. Cochran, Managing Director and Chairman of the Board, and Seán W. McCarthy, Managing Director and Chief Executive Officer, both veterans of the bond insurance industry. Mr. Cochran co-founded Financial Security Assurance (FSA) in 1985 and was Chief Executive Officer from 1990 to 2009. Mr. McCarthy was President and Chief Operating Officer of FSA and subsequently held the same position at Assured Guaranty, following its acquisition of FSA.
As a mutual bond insurer, BAM is 100% owned by its policyholders, the municipal issuers using BAM’s insurance to lower their cost of funding. “BAM is a new and improved insurer of U.S. municipal bonds that delivers substantial interest cost savings to municipal bond issuers and durable protection against loss for their bondholders,” said the Co-Founders. “Based on our mutual structure, BAM will employ significantly lower risk leverage against capital and claims- paying resources than the traditional bond insurance model. As a result, BAM expects to maintain substantially greater capital resources than historically required for AAA ratings. BAM has built a strong foundation for ratings stability and robust claims-paying ability through a wide range of potential adverse circumstances.
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“We are also pleased to announce that BAM is sponsored by the National League of Cities. We believe this to be a strong endorsement of the value we can add to the municipal market and tangible proof of the demand for bond insurance, particularly at the retail level.”
“BAM’s model as a mutual is attractive to cities as it allows them to receive additional benefits as the program grows,” said Donald J. Borut, Executive Director, National League of Cities. “Also, BAM’s board members bring extensive experience in local government management and a thorough understanding of the economics and processes of local government. Their experience will provide insightful guidance and ensures that BAM’s focus remains on serving our nation’s local governments. BAM’s insurance will help cities gain access to new capital, at lower cost to make significant improvements in our local communities.”
BAM differs from traditional financial guaranty insurers
BAM’s unique corporate structure distinguishes it from traditional, legacy financial guarantors in three primary ways:
–BAM’s underwriting guidelines and credit policies permit BAM to insure only U.S. essential public purpose municipal issuers of fixed rate, fully amortizing debt. Further, BAM starts with a clean balance sheet, and it has no exposure to the asset classes that caused losses for bond insurers during the recent financial crisis;
–BAM’s mutual model generates capital growth to support growth in the insured portfolio. This eliminates the need to “go public” to raise capital, to drive earnings growth to satisfy equity markets, or to engage in mission creep by taking on risks outside of the core municipal market;
–In addition to its own strong capital base, BAM will have the benefit of collateralized first-loss reinsurance protection for losses up to the first 15% of par on each policy written.
BAM has strong capitalization and low leverage
BAM will be sizably capitalized on Day 1, with half a billion dollars in initial funding (plus $100 million pledged in the collateral trusts), and BAM’s capital will grow as its insured portfolio grows. Each municipal issuer that purchases insurance from BAM will become a “member” of BAM. The payment for a BAM policy includes a risk premium and a member surplus contribution to BAM, which will fund the growth of BAM’s claims-paying resources. BAM’s claims-paying resources are further strengthened by first loss reinsurance protection up to 15% of each insured issue, which is collateralized and held in trusts. The combination of BAM’s low risk business, low single risk limits and strong capital resources results in low operating leverage on an absolute and risk-adjusted basis.
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BAM provides policyholders with interest cost savings and other financial benefits
In addition to interest cost savings, BAM members have the right to 1) participate in future dividends on member surplus contributions, subject to regulatory approval; 2) to pay only a 10- year risk premium up front at closing and annual premiums after 10 years if bonds are not refunded; and 3) to re-utilize the member surplus contribution for the life of any refunding issue. Each of these elements of BAM membership is unique and will lower the long-term cost of public borrowing.
To ensure issuer representation in governance and policy making, BAM’s Board of Directors includes three external directors with extensive public finance experience and expertise: The Honorable Richard Ravitch, former Lieutenant Governor of the State of New York and currently Co-Chair of the New York Budget Crisis Task Force; The Honorable Edward G. Rendell, former two-term Governor of Pennsylvania and Mayor of Philadelphia; and Robert A. Vanosky, former Head of the Public Finance Division of RBC Dain Rausher Incorporated.
BAM offers the public finance market unprecedented transparency
In order to allow issuers and investors in BAM-insured bonds to monitor our financial strength, each quarter BAM will disclose claims-paying resources, leverage ratios, capital ratios and material information on its insured portfolio.
Additionally, to increase liquidity and transparency for BAM-insured bonds, BAM will publish obligor disclosure briefs on every bond issuer insured. These briefs are easily accessible by CUSIP, obligor, state and sector on BAM’s website. This information is also meant to assist broker-dealers in meeting disclosure rules for secondary market transactions.
BAM starts out with a deep bench of experienced managers
Joining Co-Founders Mr. Cochran and Mr. McCarthy are a senior team of highly experienced financial guaranty and municipal market professionals:
Scott C. Richbourg, BAM’s Head of Public Finance, formerly Executive Director and Manager of the Southern Group for Public Finance at Morgan Stanley and, before that, Managing Director of Public Finance at FSA;
Elizabeth “Beth” Keys, BAM’s Chief Financial Officer (CFO), joining from Guy Carpenter, where she was Vice President and CFO;
Alex Makowski, General Counsel, joining from Assured Guaranty and formerly FSA, where he was a Managing Director;
Suzanne Finnegan, Chief Underwriting Officer, formerly Executive Vice President at Wells Fargo Bank, N.A., where she was the Senior Credit Officer overseeing credit transactions in the Government Banking segment;
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Elizabeth “Betsy” Hill, Head of Surveillance, joining from FSA in a similar position;
Laura Levenstein, Chief Risk Officer, and formerly Senior Managing Director for Global Public, Project and Infrastructure Finance at Moody’s Investors Service;
David McIntyre, Chief Technology Officer and formerly Managing Director, Global Head of Development Standards and Control at BlackRock, Inc.; and
Betsy Castenir, Head of Corporate Communications, and formerly Managing Director of Corporate Communications at FSA and later Assured.
Key Facts
Rating
Insured Portfolio
Claims-Paying Resources
First Loss Protection Single Risk Limits Operating Leverage
About BAM
AA/Stable from Standard & Poor’s Ratings Services
U.S. essential public purpose municipal issuers (municipal entities qualifying under Section 115 of the Internal Revenue Code)
$600 million on Day 1, growing over time from member surplus contributions from municipal issuers and additions to the collateral trusts securing first loss reinsurance
15% first loss reinsurance on the par amount of each policy, secured by high quality collateral held in trusts
20% of BAM qualified statutory capital for A or higher-rated bonds; 15% for BBB
BAM starts today with no exposure against its capital. As municipal bond insurance exposure grows, BAM’s surplus and claims-paying resources will grow. Target operating leverage over the long term is 50-60:1.
Domiciled in New York, Build America Mutual Assurance Company is a mutual, monoline bond insurer of essential public purpose U.S. municipal bonds. As a mutual, the Company is 100% owned by its policyholders, the municipal issuers using BAM’s insurance to lower their cost of borrowing. BAM is rated AA/ Stable by S&P and regulated by the New York State Department of Financial Services. BAM is also a member of the National Association of Mutual Insurance Companies.
For further information, please contact:
Betsy Castenir, Head of Corporate Communications, 212-257-6148
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I’m very pleased to announce that Build America Mutual Assurance Company (BAM) is the newest member of the Bond Dealers of America.
The BDA now represents 54 firms active in the US fixed income markets and continues to be the primary voice in Washington, DC when advocating for the interests of fixed income dealers whose primary focus is the US capital markets. The addition of BAM makes the BDA a deeper, stronger and more effective trade association when representing the interests of BDA member firms.
BUILD AMERICA MUTUAL:
THE NEXT GENERATION BOND INSURER
BAM’s mission is to deliver substantial interest cost savings for issuers of municipal bonds and durable protection against loss for municipal bondholders. Owned by its policyholders –the cities, states and other municipal entities that use its guaranty–BAM’s mutual structure and business plan provide extremely strong capital and claims-paying resources designed to maintain the highest available ratings and strong investor confidence.
BAM is chartered to insure U.S. municipal bonds, exclusively. Its underwriting and credit policies permit BAM to insure only U.S. essential public purpose municipal issuers of fixed rate, fully amortizing debt.
Sizably capitalized on Day 1 in excess of half a billion dollars in initial funding, BAM’s capital will grow as its insured portfolio grows, eliminating the need to increase capital by either incurring risks outside of the
company’s narrow, low risk market —’mission creep’— or turning to the public markets to add capital. BAM’s claims-paying resources are further strengthened by first loss reinsurance protection up to 15% of each insured issue, which obligation is secured in trust for the sole benefit of
BAM. Importantly, BAM has no legacy exposure in its insured portfolio to asset classes that caused losses for bond insurers during the recent financial crisis.
BAM is rated AA/Stable by Standard & Poor’s Ratings Services. Domiciled in New York, BAM is regulated by the New York State Department of Financial Services. BAM is sponsored by the National League of Cities.
www.buildamerica.com
The BDA represents securities dealers with a primary focus on the US fixed income markets. Through direct, federal advocacy, industry events, market practice documents and industry surveys the BDA continues to be the primary advocate in Washington, DC for fixed income dealers.
For more information on the BDA please contact Mike Nicholas
at mnicholas@bdamerica.org or 202-204-7901. You can also find more information on the BDA website: www.bdamerica.org.
Mike Nicholas
Bond Dealers of America 202.204.7901 office 202.330.2739 cell
The Association of Fixed Income Dealers
www.BDAmerica.org

Governor Andrew M. Cuomo today announced that the Department of Financial Services (DFS) has licensed Build America Mutual Assurance Company (BAM) to operate as the first mutual bond insurer serving the U.S. municipal market. After receiving $600 million in initial financing, the company has secured a “AA” rating from Standard & Poor’s (with a stable outlook), which makes BAM the highest-rated bond insurer in the nation.
“New York is committed to fostering innovative new businesses. Build America will strengthen the economy and help create jobs not only in New York, but around the nation, by helping small local governments raise the funds they need to build necessary projects, while saving taxpayers’ money,” Governor Cuomo said.
Benjamin M. Lawsky, Superintendent of Financial Services, said, “Governor Cuomo is committed to ensuring that New York remains a vibrant financial services center. BAM’s unique business model will create dozens of jobs within the state. Further, the company should enable smaller and mid-sized communities to undertake essential capital projects that are good for the economy. The Department will closely monitor BAM to safeguard against the problems that the bond insurance market encountered during the height of the economic crisis”.
BAM has been established to provide bond insurance to the small and mid-sized municipal bond market and will focus on municipal bonds up to $75 million. BAM will insure only investment grade general obligation bonds or other revenue bonds issued to fund essential governmental facilities and services. The company will not insure structured securities, a practice which caused serious problems for bond insurers during the financial crisis. As a mutual insurer, the company will be owned by the issuers who are also its policyholders. BAM expects to issue its first policy in September 2012. BAM will be headquartered in New York City. The insurer will initially employ an estimated 40 people. It expects employment to grow to approximately 100 employees within two years.

Build America Mutual has filed its 2013 audited financial statements and fourth-quarter operating supplements with the National Association of Insurance Commissioners and posted the information in the Financial Information section of the company’s web site at: https://live-bambondscom.pantheonsite.io/financialinformation.
For more information, contact Richard Holzinger, Head of Investor Relations, at rholzinger@buildamerica.com or 212-235-2518.

Mutual bond insurer Build America Mutual Assurance Company (BAM) today announced the launch of a program to offer real- time quotes and electronic execution of its AA/Stable rated bond insurance on secondary municipal market trades on the TMC Bonds electronic trading platform.
“Through TMC Bonds, traders, institutional investors and retail trading desks now have the ability to purchase BAM secondary market insurance for bonds they are trading or already hold that qualify for BAM insurance,” said Seán W. McCarthy, Chief Executive Officer, BAM. “Our goal is to make BAM municipal bond insurance more broadly accessible, and we believe that electronic execution available on TMC Bonds will accomplish that.”
Thomas S. Vales, Chief Executive Officer of TMC Bonds, said: “With BAM offering insurance for municipal bonds over our system, we will continue to bring both greater transparency for market participants to get real-time insurance quotes and greater efficiency with one-click secondary insurance capability.” During the third quarter of 2013, TMC facilitated 31% of all inter-dealer trades in municipal securities.
BAM Posts Obligor Disclosure Briefs (ODBs) on Each Insured Transaction
BAM ODBs, which provide current credit information on every BAM-insured bond, are also available directly on the TMC platform for any already BAM-insured municipal bond. ODB information includes issue and series name; gross par insured
by CUSIP, maturity and coupon; sector designation and a summary of financial information with key ratios. Demographic data and economic data relevant to the obligor are also posted, when available. In addition to providing transparency on BAM-insured transactions, this information helps to ease compliance with disclosure rules for secondary market trades.
BAM has qualified a significant number of municipal credits for its secondary market insurance and will provide additional credits as new issues become available for trading. For issues not yet qualified, users can call BAM’s Secondary Market Desk at 212.235.2550.
Build America Mutual provides its guaranty on municipal bonds, exclusively, in core sectors of the market, including G.O., general fund, appropriation bonds and dedicated tax revenue bonds; utility and transportation revenue bonds; and bonds issued by public colleges and universities.
About BAM
Domiciled in New York, BAM is a mutual bond insurer of municipal securities, exclusively. BAM is rated AA/Stable by Standard & Poor’s Rating Services (S&P), the highest S&P rating in its industry, and is sponsored by the National League of Cities. For more information, go to www.buildamerica.com.
For more information, contact:
Michael Stanton
Head of Strategy and Corporate Communications 200 Liberty Street
New York, New York 10281
212-235-2575
C: 917-838-3548
mstanton@buildamerica.com