Assured Guaranty Ltd., the holding company of the two principal players in the bond insurance industry, on Thursday announced fourth-quarter 2009 operating income of $155.9 million, way up from $3.5 million in the fourth quarter of 2008.

The figures exclude net-realized investment gains and losses and other items.

Consolidated net income for the entire year was $216.7 million, versus a net loss of $243.8 million in 2008.

Through the municipal bond insurers Assured Guaranty Corp. and Assured Guaranty Municipal Corp., the parent company backed $34.8 billion of municipal debt last year, or 98.2% of the insured market, according to Thomson Reuters.

“We recorded strong operating earnings for the year, despite losses in our residential mortgage-backed insured portfolio,” Dominic Frederico, Assured’s president and chief executive officer, said in an 8K filing to the Securities and Exchange Commission.

Assured incurred $60.2 million in credit-related losses on derivatives in the fourth quarter, a reduction from the $142.2 million of similar losses in the third quarter.

Frederico attributed much of the growth to the July 1 acquisition of Financial Security Assurance Holdings, which was renamed Assured Guaranty Municipal. Acquisition-related expenses were $12.1 million in the fourth quarter.

“The company has a strong platform for future growth supported by our strong market acceptance in the fixed-income and equity markets, as evidenced by record 2009 originations in our core U.S. municipal business and by our two successful capital raises during the year,” Frederico said.

Both bond insurer subsidiaries are rated Aa3 with a negative outlook by Moody’s Investors Service and AAA with a negative outlook by Standard & Poor’s. Fitch Ratings withdrew its ratings on both companies at Assured’s request on Wednesday.

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