Our Company
Business Overview
Business Overview
In FSA's financial guaranty business, we focus on creating financial solutions for issuers and providing the highest quality investments for both institutional and retail investors while, at the same time, setting the industry standards for credit discipline and financial strength.
FSA's Triple-A guaranty allows the issuer to reduce financing costs. Issuers may also benefit from diversification of funding sources, increased proceeds or more efficient capital management.
For investors, our unconditional and irrevocable guaranty provides complete default protection, and insured bonds tend to retain more market value than comparable uninsured bonds when an underlying issuer is downgraded. Additionally, we consolidate analysis, due diligence and surveillance activities that would be costly and time-consuming for each investor to conduct independently. In the rare event that an issuer's payments are interrupted – for any reason, including fraud – we make scheduled interest and principal payments to investors on time and in full. It is then our job, not the investor's, to recover the shortfalls.
The financial strength of a bond insurer derives from a combination of underwriting practices and claims-paying ability. On the credit side, we limit our business to market sectors characterized not only by low loss-probability but also by low loss-severity and high recovery rates in the unlikely event of a claim. All transactions have to be at least investment-grade before we insure them. (See underwriting and risk management)
Our financial products business is a natural outgrowth of our financial guaranty business. We apply the same underwriting standards to these guaranteed products, serve many of the same customers and apply our structuring and credit expertise to both the development of customized products and our investments in the asset-backed market.
We operate in dynamic global markets that continue to grow more complex. Our experienced and talented professionals meet the challenge through their knowledge, commitment, creativity and discipline, guided by a set of key operating principles that have proven their value over the years.