KBW Conference

September 4, 2007

2

Forward-Looking Statements

This presentation contains statements that may be considered “forward looking statements”. These statements are based on our current expectations and current views of the economic and operating environment and are not guarantees of future performance. A number of risks and uncertainties, including economic and competitive conditions, could cause our actual results to differ materially from those projected in forward-looking statements. Among the factors that could cause actual results to differ materially are (i) changes in general economic conditions, including inflation, foreign currency exchange rates, interest rates and other factors; (ii) decreased demand for our reinsurance products; (iii) the loss of significant customers with whom we have a concentration of our reinsurance in force; (iv) legislative and regulatory developments; (v) changes in regulation or tax laws applicable to us, our subsidiaries or customers; (vi) a downgrade in financial strength ratings of RAM Re by Standard & Poor's or Moody's; (vii) more severe losses or more frequent losses associated with our products; (viii) losses on credit derivatives; (ix) changes in our accounting policies and procedures that impact the Company's reported financial results; and (x) other risks and uncertainties that have not been identified at this time. See our annual report on Form 10-K filed with the SEC and available on our website for more risk factors that could affect our forward looking statements. The Company undertakes no obligation to revise or update any forward-looking statement to reflect changes in conditions, events, or expectations, except as required by law.

Vern Endo

President & Chief Executive Officer

4

Company Overview

Dedicated to financial guaranty reinsurance

Investment grade obligations and low loss ratios

Provide meaningful capacity

Claims-paying resources of $978 million

Rated AAA by S&P and Aa3 by Moody’s

Only independent AAA rated reinsurer, providing customers 100% capital relief

Proven financial performance since Bermuda formation in 1998 and IPO in 2006

Financial Guaranty Reinsurer of Choice

Only reinsurer with treaties with 6 of 7 AAA primaries

5

Financial Guaranty Product Overview

Ensures timely payment

Municipal and asset-backed securities

Benefits issuers

Lower borrowing costs

Enhanced marketability

Benefits fixed income investors

Protection from loss

Enhanced liquidity

Market price stability

Financial guaranty insurance: a value-added product

Characteristics Primary Clients

6

Consistent Growth & Profitability

Uninterrupted net income growth over ten years at annualized rate of 9.6%; annualized growth in par insured of 11.7%; loss ratios

averaged 10.4%

Financial Guaranty Industry Growth & Stability(Net Income $ in millions, Par Insured $ in billions)

0

500

1,000

1,500

2,000

$2,500

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Ne

t In

co

me

& P

ar

Ins

ure

d

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

Lo

ss

Ra

tio

Net IncomePar InsuredLoss Ratio

Source: Association of Financial Guaranty Insurers

7

Achievements Since ’06 IPO

New treaties with FGIC and Assured Guaranty

Grew market share from 15% to 18%

15%+ growth in insured portfolio

Substantially improved capital position

Issued redeemable preferred at year end ‘06

Statutory capital increased by 41% in 2006

Maintained low expense base

8

Source: Company filings.

Continued Top-Line Growth

Growth in Par Outstanding ($bn) Growth in Premiums Earned ($mm)

$12.9

$17.6

$25.5

$34.7

$42.6

$48.8

$0

$10

$20

$30

$40

$50

2001 2002 2003 2004 2005 2006

$12.8

$15.9

$19.8

$22.2

$27.1

$31.1

$0

$5

$10

$15

$20

$25

$30

$35

2001 2002 2003 2004 2005 2006

Avg. Annual G

rowth 2001-2006 = 20%

Avg. Annual G

rowth 2001-2006 = 31%

9

Efficient and Unique Business Model

Business Model

Reinsurance Focus Not competing with customers

AAA rating Provide customers 100% S&P capital relief

Bermuda Domicile Tax advantage offsets ceding commission

Meaningful capacity $978M claims paying ability

Treaty based business production Risk diversification

Cost efficiency

Implication

10

Primary Reinsurer Relationship

Fundamentally based on remote loss underwriting standard confirmed independently by rating agencies

Reinsurance used to manage single risks and concentrations

No viable alternative to cede single risk

Aligned interests

Primaries retain pro rata exposure on individual transactions 8 to 10 times greater

Reinsurer downgrades can cause primaries significant disruption

Since 1998 RAM incurred credit losses total $22.5MM

11

Risk Management: Quota Share Treaties

Pro rata risk sharing most effective approach to achieving portfolio diversification

Allocate capacity to individual treaties based on customer assessment

Basic principle: Establish larger single cession limits for lower risk sectors and higher rated transactions

Vigilantly monitor monthly cessions and use exclusion list process to manage insured portfolio concentration limits

Focus on managing concentration limits

12

Selected Portfolio Concentrations

2005 – 2007 Vintage (1) RAMPrimaries(2

)

US Sub-prime RMBS 0.4% 0.9%

High Grade ABS CDOs 1.7% 3.5%

Mezzanine ABS CDOs 0.0% 0.4%

Sub-prime RMBS in ABS CDOs (3) 18% 35%

CDO Collateral (3) 20% 22%

(1) All data reported at 6/30/07, with RAM reporting on a one-quarter lag. CDOs represent CDOs with significant RMBS.

(2) Includes Ambac, FGIC, FSA, MBIA and SCA (Source: Company filings and websites where available, based on RAM estimates).

(3) Percentage of CDO par outstanding with significant RMBS.

Smaller concentrations of Sub-prime RMBS than the Primaries

13

Insured Portfolio Mirrors That of Primaries

RAM RE’S IN-FORCE PORTFOLIO

BOND INSURANCE COMPOSITE *

*Average breakdown for Ambac, FGIC, FSA and MBIA.Source: Company flings and websites.

The shadow rating mix of RAM Re’s portfolio is comparable to the average mix for large primary insurers

AAA22%

AA26%A

30%

BBB21%

Below BBB1% AAA

20%

AA26%A

37%

BBB16%

Below BBB1%

14

Diversified Insured Portfolio

International23%

California8%

New York6%

Florida3%

Other States29%

Multi-State25%

Texas3%

Illinois3%

Total Par Outstanding = $34.9 billion

BY GEOGRAPHIC DISPERSION

BY PRODUCT

International23%

U.S. Structured

25%

U.S. Municipal

52%

15

Risk Management: Surveillance

Monitor individual transactions

Report sub performing deals

Remediate sub performing transactions

Report to reinsurers

Monthly: Transactions ceded

Quarterly: Portfolio data

Currently: Unusual transaction developments

Focus on sub performing transactions and sectors in consultation with primaries

Calculate probable and estimable losses based on primaries’ input

Monitor portfolio based on current information

Efficient and up to date surveillance process leveraging significant primary company resources

Primaries

16

Well Positioned For Improved Market

Sub-prime not expected to threaten ratings stability

Probable near term reduction in structured finance volume

Expected cyclical increase in premium rates and volume barring recession

Large competitors focused on other areas

Excess capital position with generally lower concentrations

Treaties require primaries to cede all qualifying business

Treaties and capital in place

More revenues per unit of capital

Increase market position to increase operating leverage

Market Environment Strategy/Position

Richard Lutenski

Chief Financial Officer

18

Balance sheet is clean, simple and solid…providing visibility and driving future operating revenues

($ millions) 6/30/07 12/31/06Assets Cash and investments $652 $620 Deferred acquisition costs 81 74 Receivables and other 19 18 Total assets $752 $712

Liabilities Unearned premiums $218 $194 Losses and LAE 16 15 Long-term debt 40 40 Redeemable preferred 75 75 Other 8 9 Total liabilities $357 $333

Shareholders' equity $395 $379

Summary GAAP Balance Sheet ($ in

millions)

19

Capital Resources

Total claims paying resources ($ millions)

Statutory capital $415

SAP unearned premiums 252

PV net installment premiums 130

SAP loss & LAE reserves 1

Soft capital facilities 180

Total $978

• Capital Ratio (debt service outstanding/statutory capital)

133:1 (AAA primaries range from 125:1 to 218:1, averaging 158:1)

• Claims Paying Ratio (debt service outstanding/claim resources)

56:1 (AAA primaries range from 60:1 to 98:1, averaging 78:1)

• Ample capital adequacy clearance relative to rating under S&P and Moody’s capital adequacy models

20

An Estimate of Intrinsic Value

Book Value at 6/30/07

Per share: $14.49

+ Unearned Premiums net of prepaid reinsurance premium

+ NPV of Installment Premiums

- Deferred Acquisition Costs

- Estimated Acquisition on Future Installment Premiums

- unrealized gains (losses)

= Estimated Intrinsic Value or ABV

Per Share: $24.74

Estimated intrinsic value or adjusted book value is 1.7X book

$395

216

184

81

55

(14)

$673

($ in millions except per share amounts)

21

Historical Financial Results

* Operating revenues is a non-GAAP measure equal to the sum of earned premiums and net investment income.** Operating income is a non-GAAP measure equal to net income less the sum of (a) realized investment gains/(losses) and (b) unrealized gains/(losses) on credit derivatives.

($ in millions)

Our expanding market position is evidenced by strong growth

in operating revenues, operating income and net incomeAverage % Growth Well Above 20%

0

10

20

30

40

50

60

70

80

2002 2003 2004 2005 2006

$ m

illi

on

s

operating revenues

operating income

net income

22

Historical Financial Results

A further sign of our growth and ramp up also illustrates an attractive business characteristic: cash flow from

operations exceeds net income on a consistent basis. 2001-06 cumulative cash flow from operations is 1.8X cumulative

net income.

0

10

20

30

40

50

60

2001 2002 2003 2004 2005 2006

Net Income and Cash Flow$ millions

net income

operating cash flow

23

First Half 2007 Financial Summary

Total revenues increased by 34% over 2006

Earned premiums up 25% – driven by growing in-force business

Investment income up 44% – driven by growth in invested assets and increase in book yield

Total expenses up by 46% relative to six months of 2006

Higher acquisition follows earned premiums, 2006 included large negative incurred loss, 2007 includes preference share dividends

Net income increased by 25% to $23.4 million

Net income is reflective of growth and progress, but the level of net income is somewhat higher than a normalized level would be due to favorable loss activity that resulted in a benefit (a negative incurred loss)

Cash flow from operations reached $49.7 million, nearly double the level for first half of 2006

24

Bridge to Improving ROE

Continued Progress in Achieving Operating Leverage

* Major primaries are Ambac, FSA and MBIA and used to represent operating leverage of mature Financial Guaranty companies (source: company filings and web sites)

2002 2003 2004 2005 2006 RAM 9.9% 10.6% 11.6% 13.4% 13.8% Five Year Average for 3 major primaries 14.9%

As investments leverage grows, ROE rises unless portfolio yield declinesInvested assets/average equity

2002 2003 2004 2005 2006 RAM 129% 135% 137% 148% 164% Five Year Average for 3 major primaries 173%

25

Operating Performance

1 Operating return is constructed as the sum of (a) investment income/average equity plus(b) earned premium*(1 minus combined ratio) divided by average equity over rolling

four quarters.

RAM Operating1 Return ComponentsRolling Four Quarters

0%

2%

4%

6%

8%

10%

12%

14%

50%

55%

60%

65%

70%

75%inv. Income/equity

(premium*margin)/equity

total expense ratio

26

Summary

Pure play AAA rated reinsurer in AAA industry

Bermuda based platform

Reinsurer of choice: Treaties with six of seven AAA primaries

Capital resources in place both to support AAA rating and to maximize spread widening opportunities

Risk management model based on

Remote loss underwriting

Aligned interests with primaries

Quota share treaties to diversify risks

Leveraging primary company resources

Unique franchise positioned for growth

27

Appendix Explanation of Non-GAAP Measures

This presentation includes non-GAAP measures that are believed to be useful supplements for evaluating various aspects of the company. Such non-GAAP measures should not be viewed as a substitute for GAAP financial measures and non-GAAP measures as presented and defined herein may differ from such measures as presented and defined by other financial guaranty industry participants.

Operating revenues is defined to be the sum of earned premiums plus investment income and differs from total revenues in that it excludes realized investment gains or losses and unrealized gains or losses on credit derivatives. We believe operating revenues provides a more meaningful view of core business revenues because realized investment gains or losses and unrealized gains or losses on credit derivatives are primarily reflective of changes in interest rates and spreads over which the company has no control.

Operating income is defined as net income less the sum of (a) realized investment gains or losses, and (b) unrealized gains or losses on credit derivatives.

The net present value of installment premiums is the discounted value of estimated future premiums on in-force business written on an installment basis. Actual future premiums may differ from estimates due to factors the including, among others, amortizations, pre-payments or defaults.

Estimated intrinsic value or Adjusted Book Value is defined as shareholders’ equity (book value) plus unearned premium reserve (deferred premium revenues) net of deferred acquisition costs plus the net present value of estimated future installment premiums net of estimated acquisition expenses minus unrealized investment gains/(losses).