All of the transactions commuted pursuant to the CDO Commutation  Transactions were rated below investment grade  (“BIG”) internally at the time of the transaction, with $1 billion net par outstanding of the commuted transactions rated B or  below internally. In the aggregate, the transactions commuted pursuant to the CDO Commutation  Transactions represented  approximately 51% of our financial guaranty segment’ s aggregate net par outstanding rated B or below internally at the time of  the transaction. Following the CDO Commutation Transactions, we no longer have any exposure to CDO of  ABS transactions. CDO Early Terminations. During 2012, CDS counterparties in our financial guaranty business exercised their  termination rights with respect to 35 corporate  CDOs, a foreign infrastructure CDS and a CDS of an investor -owned utility  bond that we insured (collectively, the “CDO Early Terminations”), which further reduced our financial guaranty net par  outstanding by $14.6 billion in the aggregate. There was no material impact on our financial statements as a result of these  terminations. FGIC Commutation. On November 9, 2012, Radian Asset Assurance entered into an agreement with Financial  Guaranty Insurance Company (“FGIC”) to commute the remaining $822.2 million of outstanding par reinsured by Radian  Asset  Assurance from FGIC (the “FGIC Commutation”).  This transaction, which closed in January 2013, included the commutation  of approximately $195.9 million of Radian  Asset Assurance’s $225.3 million in net par outstanding as of December 31, 2012,  related to Jefferson County, Alabama sewer warrants, a large distressed public finance credit. Radian  Asset Assurance made a  commutation payment of approximately $52.4 million as part of this transaction.  The amount of the FGIC Commutation  payment was determined primarily based on existing loss reserves and unearned premium reserves, and therefore, did not have  a material impact on our consolidated financial statements or Radian  Asset Assurance’s statutory capital position. Contingency Reserve Release and Dividends.  In the second quarter of 2012, Radian  Asset Assurance released $54.5  million of contingency reserves, which benefited Radian Guaranty’ s statutory surplus by an equal amount. In July 2012, Radian  Asset Assurance paid an ordinary dividend of $54.0 million to Radian Guaranty . In January 2013, $6.7 million of contingency  reserves were released due to the FGIC Commutation, and on February 7, 2013, the  New York State Department of Financial  Services , (the “NYSDFS”) approved the release of an additional $61.1 million of contingency reserves of Radian  Asset  Assurance resulting from the maturity or termination of financial guaranty policies. Our aggregate financial guaranty net par outstanding decreased significantly in 2012 from $69.2 billion as of December  31, 2011 to $33.7 billion as of December 31, 2012. We expect our net par outstanding will continue to decrease as our financial  guaranty insured portfolio matures, as we proactively seek to reduce our financial guaranty net par outstanding, and as  counterparties potentially continue to terminate transactions early in accordance with their rights under such transactions.  The  reduction in net par outstanding in 2012 was primarily due to the  Assured Transaction, the CDO Early Terminations and the  CDO Commutation Transactions, as well as the amortization or scheduled maturity of our insured portfolio and prepayments of  public finance transactions. On January 9, 2013, the FGIC Commutation was consummated resulting in an additional reduction  of $0.8 billion of net par outstanding.  Financial Guaranty Portfolio Net Par Outstanding 117