`Gloves' Greenberg, The Bowery's Haberdasher By LARRY McSHANE
(APW_ENG_19950622.0143)
1) The drunken and the dispossessed, the penniless and the panhandlers _ Michael Greenberg gloved them all.
2) For 30 straight winters, ``Gloves'' Greenberg single-handedly distributed free gloves to the needy between Thanksgiving and Christmas in the Bowery, a poor neighborhood in lower Manhattan.
3) Greenberg, a 67-year-old advertising executive, died Monday of cancer, an illness that last winter halted his glove handouts for the first time since 1963.
4) ``It was a very private thing for him,'' said Russell Aaronson, a cousin who plans to take over the glove-giving tradition. ``He made a point of actually looking into people's eyes, and through that, developed a trust.''
5) Trust was in short supply among Greenberg's clientele. The Bowery's homeless often wondered what Greenberg wanted in return for his gift.
6) ``A handshake,'' he replied. It almost always worked.
7) For his first 23 years, ``Gloves'' worked anonymously. But in 1976, a shopping bag filled with gloves was stolen as he rode the subway. The New York Times wrote about his plight, and the sidewalk philanthropist attained some small celebrity.
8) His Greenwich Village apartment became a home for wayward gloves, mailed in by donors.
9) Despite the attention, Greenberg always worked one-on-one with the homeless. He never dumped a large shipment at a charity or shelter; Greenberg provided each customer with his personal touch.
10) Two events led Greenberg to his career as free-lance handwarmer. While growing up in Brooklyn during the Depression, he lost a pair of gloves. He never had a replacement pair until he entered the Army.
11) Then his father died in 1963. Greenberg wanted a way to memorialize the man.
12) Initially, he handed out 72 pairs annually _ four times 18, the Hebrew symbol for life. Over the years, it grew to about 300 pairs each winter.
13) Aaronson, the next Glove Man, said the family is accepting contributions on his uncle's behalf to pay for the glove giveaway and AIDS research.
14) ``We know he's at peace now,'' Aaronson said. ``He expressed very strongly that he wanted the charity to continue. That was his wish.''


Message Was Erased Prior To End of Game, Says Coach EDs: Note language in 2nd graf
(APW_ENG_19960127.0061)
1) An anti-Semitic message found scrawled inside the visitors' locker room at New Mexico State and directed at Long Beach State coach Seth Greenberg was erased prior to the end of the game, Greenberg said.
2) Greenberg, who is Jewish, found the message prior to Monday night's nationally televised game between the two schools at Las Cruces, New Mexico. It said, ``Seth, get ready for an ass-kicking, you Jew bastard.''
3) Greenberg also complained after the game that his players _ blacks and whites _ had been the targets of racial slurs during the game. Late in the game, Greenberg had officials eject three students from the stands, accusing them of making racial remarks.
4) The Albuquerque Journal quoted Greenberg as saying he was asked to leave the anti-Semitic message on the board so that photos could be taken and made available if needed to investigators.
5) ``We left it there,'' Greenberg said Friday. ``At halftime, we left the room and locked it when we went down for the second half. When we came back, it was gone. What I want to know is, who erased it?''
6) New Mexico State officials have said they are investigating the incident and have been instructed by the Big West Conference to submit a report. A school official said Friday the report was being completed and probably would be sent to the league office early next week.
7) New Mexico State president J. Michael Orenduff this week dictated a letter that was sent to Long Beach State president Robert Maxson. The letter expressed regret over the incident, but also criticized Greenberg for comments he made regarding the anti-Semitic message and the crowd's conduct.
8) The letter to Maxson said, in part:
9) ``Considering that your coach was under considerable emotional stress, I can understand his reaction. It is however, unfortunate that his remarks, made in the heat of the moment, were telecast nationally by ESPN. His remarks impugned New Mexico State University and the entire state of New Mexico based on one anonymous piece of paper and alleged remarks which came from a very small number of people and which, in fact, were heard differently by persons close to the scene.''
10) Greenberg said after the game the scrawled message he found plus the racial harassment of his players from the stands, reflect badly on NMSU and the state of New Mexico.
11) Greenberg also has called Orenduff's letter ``an insult'' and Friday said he had not heard from anyone at NMSU.
12) Greenberg also has been angered by remarks made by New Mexico State coach Neil McCarthy that Greenberg ``just wanted attention directed to him.'' McCarthy also has attributed Greenberg's outburst to stress brought on by the recent death of Greenberg's father.
13) ``I feel bad for Neil if he feels that way,'' Greenberg said Friday from Stockton, California, where the 49ers play Pacific Saturday night. ``Obviously, he has never been the object of a hate crime.
14) NMSU regent Larry Sheffield said he felt the school had apologized and considered Orenduff's letter appropriate.
15) ``This is the first time I've ever heard of any type of racial slur. New Mexico State is color-blind,'' Sheffield said.


Emerging Markets Datafile
(APW_ENG_19971215.1112)
1) December 15, 1997
2) BUSINESS TIMES
3) MALAYSIA
4) ENGLISH
5) The World negotiates with US chief execs
6) Hardev Kaur
7) ASIA
8) WorldSources Online, Inc.
9) 201 PENNSYLVANIA AVENUE, S.E., 2nd Floor
10) WASHINGTON, D.C. 20003
11) Tel: 202-547-4512
12) Fax: 202-546-4194
13) COPYRIGHT 1997 BY WORLDSOURCES ONLINE, INC., A JOINT VENTURE OF FDCH, INC.
14) AND WORLD TIMES, INC. NO PORTION OF THE MATERIALS CONTAINED HEREIN MAY BE
15) USED IN ANY MEDIA WITHOUT ATTRIBUTION TO WORLDSOURCES ONLINE, INC.
16) HARVARD: Three major agreements have been concluded in the last two weeks - the World Trade Organisation (WTO) agreement on financial services in Geneva, treaty to limit global warming in Kyoto and that eliminating landmines in Toronto. In all the three agreements the power of the US was omnipresent, even when it was not there as in Toronto.
17) The financial services agreement, reached after six years of negotiations, which calls for countries to open their financial services sector - banking, insurance and broking - illustrates the role of US businesses and the close links the chief executives have with the US administration.
18) The agreement was reached after protracted negotiations mainly because the US wanted to ``extract'' as much concessions from developing countries as possible.
19) The American firms, including Citicorp, Goldman Sachs and Merrill Lynch, established command posts at a hotel near the venue of the negotiations in Geneva. And as the deadline approached, many American chief executives were said to be conferring with the American negotiators.
20) Among the prominent and vocal American chief executive is Mr Maurice Greenberg, who heads the American International Group Inc (AIG), a New York company which has a subsidiary in Malaysia. He had insisted that the US negotiators reject any pact that could hurt AIG's existing operations in Malaysia.
21) Greenberg's AIG is not keep to divest its holdings, currently 100 per cent, allowing Malaysian participation in the company as required by Malaysian law. He was reported to have said that if ``Malaysia does not budge from its hard line position, there should not be a deal'', adding that ``I don't think we should sacrifice a couple of companies in order to have an agreement.''
22) Greenberg has considerable political clout, and he is credited among others for helping to stall the financial services agreement two years ago. According to a report, Greenberg, his companies and its employees have contributed close to US$1 million (US$1 RM3.81) to the Republican and Democratic parties in the past three years.
23) According to the Washington-based Centre for Responsive Politics, a non- profit organisation that monitors campaign contributions, AIG and its political action groups have given US$485,440 to Republican candidates and US$442,990 to the Democrats.
24) In addition, New York Republican Senator Alfonse D'Amato, according to the Wall Street Journal, who himself received US$18,250 from AIG for his campaign in recent years wrote to US Treasury Secretary Robert Rubin and US Trade Representative Charlene Barshefsky urging a hard stand at the negotiations.
25) While the Europeans were prepared to settle much earlier, it was the Americans and its chief executives such as Greenberg who were holding on.
26) The US had snubbed an earlier agreement, saying that others were giving too little in return for access to its financial services market.
27) The European companies and negotiators on their part said the US and AIG were ``asking for too much''. In fact Mr Andrew Buxton, Barclays Plc chairman, which also has operations in Malaysia, was quoted as saying: ``I would be very upset if a very important agreement was scuppered if one or two companies in the world failed to agree.''
28) To which Greenberg's reply was that AIG is the biggest foreign insurance player in Malaysia. ``The Europeans do not care if there's grandfathering or not, because they don't have any companies over there.''
29) That certainly is not true. There are many European firms with operations in Asia and certainly in Malaysia, such as the Hong Kong Shanghai Bank, Standard Chartered Bank and Barclays Plc.
30) The tussle between Malaysia and AIG was viewed as being symbolic of US attempts to pry open Asian markets. Malaysia had made it clear that it is committed to liberalising the financial services sector, but at a pace it is comfortable with.
31) Malaysia had in fact agreed to increase its offers and increased the ceiling for foreign holdings from 30 per cent to 51 per cent, but reportedly it was not good enough for Greenberg who wants to retain 100 per cent stake. Malaysian rules provide for a 51 per cent stake in local subsidiaries.
32) This according to some ``threatens the interests of financial services companies such as AIG''. But what about the position of the countries and their interests if the whole financial sector is opened to foreigners?
33) The financial services sector, despite the current crisis in the region, is seen as a potential big growth market in which the Europeans and the Americans want a stake.
34) Greenberg notes that despite the current currency crisis in the region his company, which has been in Asia for some 80 years, stands to benefit.
35) The benefits will accrue due to a number of factors. One is said to come from the interest rate increases that may be used to prop up the currencies, and it also means higher yields on the fixed income securities that insurers use to invest in premiums. AIG's 100 per cent owned Malaysian subsidiary, AIA, insures almost one million Malaysians.
36) AIG also sees opportunities to buy companies at bargain prices. In an interview with Bloomberg, Greenberg is quoted as saying: ``We see some opportunities where some very good companies may be selling at very depressed prices'' price-to-earning ratios.
37) The financial services sector, the fastest growing, is said to be worth some US$1.2 trillion in daily foreign exchange transactions, US$18 trillion in global securities, more than US$20 trillion in banking assets and US$2.5 trillion in worldwide insurance premiums.
38) The US wanted binding commitments allowing its bankers and insurers to set up majority-owned branches overseas. It also wanted guarantees that majority ownership rules for firms that have already made investments would be honoured in the event of legislative changes in a country's financial services.
39) Under the agreement reached early Saturday morning, each member put forward its own best offers for opening up the local financial services sector to foreigners. The offers differ greatly from country to country, but they are legally bound to stick to those commitments. If they do not and the World Trade Organisation (WTO) rules that they have backed down from their commitments, other countries then have the right to seek compensation or to impose retaliatory restrictions.
40) The US, the de facto power broker in the negotiations, is said to have conceded nothing for the agreement. Most of the changes are being made by developing countries in Asia, which are suffering from a currency crisis, and in Latin America. Yet, it continues to push other countries to give in.
41) Despite the agreement over the weekend, the US, according to its Trade Representative, will continue to work with some countries before the pact takes effect to improve their offers. In particular, she said, the US will work out differences with Malaysia over ``its proposal to limit foreign insurance companies to 51 per cent ownership of firms in Malaysia''.
42) She said that as part of the deal, the US would be able to impose sanctions against any country that forced US firms to divest any existing business, adding that the provision was specifically aimed at Malaysia.


Emerging Markets Datafile
(APW_ENG_19980112.1336)
1) January 12, 1998
2) BUSINESS TIMES
3) MALAYSIA
4) ENGLISH
5) AIG wants to continue investment here: Anwar
6) Kamarul Yunus
7) ASIA
8) WorldSources Online, Inc.
9) 201 PENNSYLVANIA AVENUE, S.E., 2nd Floor
10) WASHINGTON, D.C. 20003
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13) COPYRIGHT 1998 BY WORLDSOURCES ONLINE, INC., A JOINT VENTURE OF FDCH, INC.
14) AND WORLD TIMES, INC. NO PORTION OF THE MATERIALS CONTAINED HEREIN MAY BE
15) USED IN ANY MEDIA WITHOUT ATTRIBUTION TO WORLDSOURCES ONLINE, INC.
16) THE American International Group (AIG) Inc, a US-based insurance conglomerate, wants to continue to invest in Malaysia because it still has confidence in the country's strong economy, Deputy Prime Minister Datuk Seri Anwar Ibrahim said.
17) ``I met AIG chairman Maurice Greenberg today. What is significant during this meeting is that he has great confidence in the Malaysian economy.
18) ``He wants to continue to invest here and is committed to remain in Malaysia,'' he told reporters after meeting former US Secretary of State Dr Henry Kissinger prior to the two-day Pacific Dialogue in Kuala Lumpur yesterday.
19) Anwar was asked whether Greenberg, who will participate in the Dialogue starting today, discussed the status of 100 per cent ownership of American International Assurance, its subsidiary company in Malaysia.
20) During the recent World Trade Organisation (WTO) negotiations, most of the organisation's members have agreed with Malaysia's offer of 51 per cent foreign ownership and 49 per cent to locals for insurance companies operating in the country. The AIG, however, opposed the offer and wanted the 100 per cent ownership to remain.
21) ``I explained Malaysia's policy vis-a-vis the arrangement that we agreed on during the WTO round of negotiations but he (Greenberg) said he preferred to pursue discussions and negotiations on the issue.
22) ``I said we look forward to viewing some of his specific proposals,'' he added.
23) Asked on the proposals put forward by Greenberg, Anwar declined to elaborate, saying that it is still at a preliminary stage.
24) ``His (Greenberg) proposals were known even to American negotiators in Geneva but that has somewhat been cleared after the final settlement in the WTO agreement.
25) ``Now that it is over, he (Greenberg) has now come back with some other measures which I think are very preliminary at this stage. I look forward to see his other measures during the Pacific Dialogue tomorrow,'' he added.
26) Asked whether Malaysia will compromise with Greenberg pertaining to the foreign ownership in insurance companies operating in Malaysia, Anwar said: ``There has been a lot of compromise already but I think what is important is to get a clear undertaking from him (Greenberg) to continue to have the confidence and invest in Malaysia,'' he added.
27) Anwar also said the other American companies that will participate in the Dialogue today have indicated their commitment to continue to invest in the country.
28) ``I am pleased with this year's attendance, especially from the US business community. This is a welcome signal of continued relations, not only because of the dialogue but they have also indicated their strong commitment to continue to invest and work together with the Malaysian counterparts in improving the economy of this country.
29) ``Some of them have indicated this commitment when I met some of them today,'' he added.
30) Anwar was also asked whether the Government will revise the country's growth rate in view of the sharp fall in the ringgit last week.
31) He said the Government is confident the ringgit will slightly recover and strengthen in the next few weeks.
32) ``As we have said earlier, the ringgit has been grossly undervalued and we also have to take other measures, including intervention to ensure the ringgit would further strengthen. We also welcome initiatives like those of the International Monetary Fund and the World Bank, and now the commitment and indication of support by the US following the decision to send its Deputy Treasury Secretary Lawrence Summers to Jakarta and Kuala Lumpur.
33) ``I think this would give a clear signal that there is equal concern and commitment of the US to further strengthen the economy of these two countries to ensure that the value of currencies reflect the economic fundamentals,'' he said, adding he will be meeting Summers on Wednesday.
34) He also reminded Malaysians not to listen to rumours that there is tension in the country due to the sharp depreciation of the ringgit against the US dollar.
35) ``It is unfortunate if we choose to entertain such rumours. Apart from its strong economy, Malaysia's other strengths include the political stability and cooperation shown by the multi-racial community of the country,'' he said, when asked to comment on a Singapore-based news report that there is tension among the races in the country due to the economic problem.
36) Anwar also warned money changers that their licence would be revoked if they refuse to accept the ringgit in exchange for the US dollars, saying it is illogical for them to act in such manner.
37) He was asked on claims that certain money changers had refused to sell US dollars to people intending to visit the US.
38) ``If this has really happened, it must be an isolated case - probably one or two. But, if there are complaints and evidence, action will be taken against them. The authorities are monitoring the situation,'' he added.
39) He said so far the Finance Ministry had not received any official complaint or report on such claims, adding the matter was also not raised during his meeting with Bank Negara and bank officials on Saturday.


American International Group creates dlrs 2 billion Asia fund
(APW_ENG_19980113.0512)
1) U.S. conglomerate American International Group Inc. will create a dlrs 2 billion investment fund for infrastructure projects across Asia, the Malaysian news agency Bernama reported Tuesday.
2) It quoted AIG's chairman and chief executive officer, Maurice Greenberg, as saying that he will announce the details of the fund in Singapore Wednesday. He refused to elaborate.
3) The fund reflects the company's confidence in Asia's future despite the present economic problems, Greenberg was quoted as saying.
4) ``We are working on a number of new investment programs in many fields for the region including Malaysia,'' Greenberg said. He was in Malaysia to attend the 4th Pacific Dialogue, a three-day conference of regional and international businessmen and economists that ended Tuesday.
5) Greenberg said the allocation of the fund would depend on the nature of the projects and how they are structured, although AIG was keen to invest in the securities market and infrastructure development.
6) Greenberg declined to comment on AIG's recent row with Malaysia at the World Trade Organization. Greenberg is known to be dissatisfied with Malaysia's offer to limit foreign companies to a 51 percent stake in local insurance ventures under the WTO's agreement on the liberalization on trade and services.
7) The company's subsidiary, American International Assurance, currently controls 100 percent of its Malaysian operations and is the biggest player in the sector.
8) Finance Minister Anwar Ibrahim said Sunday that Greenberg wished to discuss the matter further. The two met earlier Tuesday, but no details of the meeting were available.


Emerging Markets Datafile
(APW_ENG_19980114.1140)
1) January 14, 1998
2) NEW STRAITS TIMES
3) MALAYSIA
4) ENGLISH
5) US firm sets up RM6.9b fund for projects in region
6) Rashid Yusof
7) ASIA
8) WorldSources Online, Inc.
9) 201 PENNSYLVANIA AVENUE, S.E., 2nd Floor
10) WASHINGTON, D.C. 20003
11) Tel: 202-547-4512
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13) COPYRIGHT 1998 BY WORLDSOURCES ONLINE, INC., A JOINT VENTURE OF FDCH, INC.
14) AND WORLD TIMES, INC. NO PORTION OF THE MATERIALS CONTAINED HEREIN MAY BE
15) USED IN ANY MEDIA WITHOUT ATTRIBUTION TO WORLDSOURCES ONLINE, INC.
16) KUALA LUMPUR, Tues. - The American International Group Inc (AIG) will set up a new US$1.5 billion (RM6.9 billion) infrastructure fund to be used for investments in various projects in the region.
17) The fund will subsequently be raised to US$2 billion, said Maurice Greenberg, chairman and chief executive officer of AIG which fully owns Malaysian insurer, American International Assurance Co Ltd.
18) He said the fund was scheduled to be announced in Singapore tomorrow.
19) Asia needed infrastructure development, though selectively, to continue the economic growth, he said.
20) ``That's something we have believed in for many, many years, being one of the things AIA had done locally for many years.
21) ``We are now reinforcing this belief by making more funds available.''
22) He told reporters on the sidelines of the Pacific Dialogue that AIG was working on a number of new investments for both Malaysia and the region.
23) The investments, he said, would be in many different fields because ``we have confidence in the future''.
24) Asked what other measures big companies like AIG could take to help the region tide over the current problems, he said: ``By investing more in the country and the region, in the securities market, direct investments and infrastructure.
25) ``We can even consider locating some of our other units in the country and in the region.''
26) Greenberg added that AIG which has been in the country for 51 years, was a very big supporter of Malaysia.
27) He declined to comment on the recent pact on financial liberalisation at the World Trade Organisation, in which Malaysia offered a 51 per cent stake to foreign companies in the insurance industry.
28) AIA is wholly-owned by AIG and this raises the question of whether AIG has to divest some of its stake in AIA.
29) Greenberg would only say he had constructive talks with Prime Minister Datuk Seri Dr Mahathir Mohamad and Deputy Prime Minister Datuk Seri Anwar Ibrahim.


Foreign firms can keep stakes in local firms for 5 years
(APW_ENG_19980504.0647)
1) Malaysian Prime Minister Mahathir Mohamad assured foreign insurance companies Monday that they will not be forced to sell off stakes in their Malaysian-based companies for five years.
2) ``We have decided that we will give them a five-year deferment,'' Mahathir told reporters after witnessing the signing of a joint-venture agreement between insurance giant American International Group Inc. and a Malaysian software company, Software International. U.S. Ambassador John Malott was also present.
3) The agreement is seen as part of the resolution of a dispute between Washington and Kuala Lumpur over AIG's ownership of its Kuala Lumpur-based American International Assurance Co. Ltd.
4) At World Trade Organization talks last year, Malaysia proposed that foreigners be barred from holding more than a 51 percent stake in local insurance companies.
5) Under those terms, AIG, which owns 100 percent of its Malaysian operation, AIA, would have been forced to divest 49 percent of its shares. AIA was set up about 50 years ago, before Malaysia began capping foreign insurers' stakes.
6) Washington insisted that Malaysia allow foreign insurers already in the country to keep 100 percent of their investments.
7) Mahathir said the five-year deferment would apply to all foreign insurers but that AIG was considered ``a very special case.''
8) M.R. (Hank) Greenberg, AIG's chairman, said the company was committed to increase its investment in the region and in Malaysia.
9) ``We invest all our reserves (from AIA) in the country and as good corporate citizens we'll continue to do that,'' Greenberg said.
10) Greenberg would not reveal the amount that AIG planned to invest in the venture but said that as the business grew, the necessary capital would be supplied.
11) The venture will serve as AIG's regional hub for software development and research and development.
12) Greenberg said AIG had set up a dlrs 1.6 billion Asian infrastructure fund and was putting together an Asian recovery fund. He did not disclose the amount.
13) After the signing ceremony, Greenberg and Alexander Lee, chairman of SIC, submitted an application to join Malaysia's high-technology project, the Multimedia Super Corridor.
14) AIG will be the first international financial company to join the MSC project, which has attracted more than 100 companies, mainly in the technology sector.


SIC and AIG in joint venture agreement, NEW STRAITS TIMES-MANAGEMENT TIMES
(APW_ENG_19980507.1420)
1) xfdws JOINT-VENTURE-AGREEMENT sked
2) Emerging Markets Datafile
3) May 07, 1998
4) NEW STRAITS TIMES-MANAGEMENT TIMES
5) MALAYSIA
6) ENGLISH
7) SIC and AIG in joint venture agreement, NEW STRAITS TIMES-MANAGEMENT
8) TIMES
9) Azlyn A. Rahman
10) ASIA
11) WorldSources, Inc.
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17) IN ANY MEDIA WITHOUT ATTRIBUTION TO WORLDSOURCES, INC.
18) SOFTWARE International Corporation (M) Sdn Bhd (SIC) and American International Group Inc (AIG) have signed an agreement to form a joint-venture company to capitalise on business opportunities in the local information technology (IT) market.
19) Called AIG-Software International JV Sdn Bhd, the new entity will have an initial capital investment of US$10 million (RM37 million), and it will offer services including maintenance and development of applications software, technical project management, recruiting of technical personnel, research and development (R&D) in emerging information technologies and data centre services.
20) AIG's chairman Morris Greenberg said the company is pleased to respond to the call of Prime Minister Datuk Seri Dr Mahathir Mohamad to have multinational corporations located within the Multimedia Super Corridor (MSC).
21) He said through the agreement, AIG will utilise the joint firm as a preferred provider for certain services and it will also offer its services to outside organisations which include other corporate clients.
22) ``In addition, AIG hopes to offer the joint venture's services to other companies operating within the MSC as well as to assist in the development of the MSC infrastructure,'' Greenberg said, adding that the initial capital of US$10 million is sufficient as software development does not need much capital to start.
23) AIG-Software International JV Sdn Bhd will also establish an IT centre for AIG's regional operations that will be engaged in research and development in global marketing of smartcards and electronic commerce for financial services staffed with high calibre IT professionals, said Greenberg who represented AIG at the event.
24) Signing on behalf of SIC was its chairman Datuk Alexander Lee. Present to witness the ceremony were Dr Mahathir and US ambassador to Malaysia John Mallot.
25) At the event, AIG-Software International also submitted its application for MSC status to Multimedia Development Corporation Sdn Bhd.


Albany's top lawyer will step down
(APW_ENG_20000914.0169)
1) Sol Greenberg, one of the state's longest tenured district attorneys, announced Thursday he will resign next week, in time to get a Democrat on November's ballot but too late for a primary.
2) Greenberg, 78, has been district attorney in Albany County for 25 years, winning his first term in November 1974. He said he will retire to spend more time with his family.
3) ''I've been thinking about [resigning] awhile,'' Greenberg said. ''My wife and I enjoy relatively good health. I want to spend more time with our children and grandchildren and I want to get into a less pressure job.''
4) The timing of the resignation was a political gesture from the Democrat.
5) Long thought to be retiring after this term, Greenberg waited until after the Sept. 12 primary to announce the resignation, avoiding any possible Democratic infighting.
6) If Greenberg had waited until Wednesday, Sept. 20, it would have been too late to get a name on the ballot and Gov. George E. Pataki, a Republican, would have had the power to appoint someone to complete Greenberg's term until January 2002.
7) Pataki's office would not discuss the issue Thursday.
8) Assistant District Attorney Paul Clyne, a 15-year-assistant, had already started organizing for next years election and will likely get the Democratic nod. Former Assistant District Attorney John Dorfman, a vocal critic of Greenberg's, has said he wants the post.
9) Current Chief Assistant District Attorney Larry Wiest will take over as acting district attorney.
10) Greenberg's office developed a reputation of winning lengthy prison terms - especially in the mid 1980s.
11) But Greenberg also had his share of criticism, particularly for not prosecuting former Albany County Executive James Coyne for taking kickbacks during the building of the city's civic arena. Coyne was prosecuted by federal law enforcement agencies and served prison time.
12) The district attorney earns $131,400 a year.


AIG Makes Bid for American General
(APW_ENG_20010404.0431)
1) Global insurance giant American International Group Inc. has offered $23 billion in stock for American General Corp., attempting to outbid Prudential PLC for control of the Texas-based insurance company.
2) However, Prudential said Wednesday in a statement to the London Stock Exchange that its plan to acquire American General ``remains in full force and effect,'' raising the possibility of a trans-Atlantic bidding war.
3) AIG chairman and CEO Maurice Greenberg said in a statement Tuesday that he hopes to talk soon with American General officials about the proposal, which values the company at $46 per share.
4) The offer represents a premium of 25 percent from American General's closing stock price of $36.80 Tuesday. American General is based in Houston, while AIG is headquartered in New York.
5) ``We believe that the combination of our two companies is uniquely attractive, in terms of mix of businesses and distribution channels, and would be highly beneficial financially to both of our shareholder groups,'' Greenberg said.
6) On March 12, London-based Prudential offered $22.5 billion in stock to acquire American General, one of the nation's largest insurance and financial services companies. Prudential is unrelated to the Newark, N.J.-based Prudential Insurance Co. of America.
7) But Prudential's stock price dropped after the announcement, and the deal's value had declined to about $20 billion by Tuesday.
8) ``It appears clear that the exceptionally steep price drop experienced by Prudential's stock reflects investors' serious concerns with the transaction,'' Greenberg said in a letter sent Tuesday to American General Chairman Robert Devlin.
9) American General would maintain its own identity under the combination with AIG, and Devlin would be offered a seat on AIG's board, Greenberg wrote.
10) American General has been considered a good takeover candidate because it holds leading market positions in both fixed and variable annuities. The company has 1,350 offices in 40 states and 16,000 workers.
11) AIG, one of the world's largest insurers, employs approximately 55,000 workers worldwide, and has interests in consumer finance, aircraft leasing and data processing. It has operations in 130 countries and generates more than half of its revenues overseas.
12) The deal would allow AIG to expand in Texas, and the company would ``honor existing financial arrangements'' for Devlin and American General employees, Greenberg wrote.
13) Devlin previously said the combination with Prudential would probably result in U.S. job losses.
14) In a prepared statement late Tuesday, American General acknowledged receiving the unsolicited offer from AIG.
15) The ``offer will be carefully considered by the company's board of directors. American General will continue to act in the best interest of its shareholders,'' the company said.
16) American General must pay Prudential up to $600 million if it terminates their merger agreement. If Prudential calls off the deal, it must pay American General $347 million.


Greenberg Heads to South Florida
(APW_ENG_20010621.1302)
1) Brad Greenberg, a former general manager of the Philadelphia 76ers, was introduced Thursday as director of basketball operations at South Florida, where his brother is the head coach.
2) Brad Greenberg, 47, will handle day-to-day administrative duties for the men's team as well as team travel, scheduling, academics and scouting.
3) ``Over the years I have become increasingly more interested in the college basketball scene,'' said Greenberg, who was the 76ers GM and vice president in 1996-97. He was responsible for drafting Allen Iverson in 1996.
4) Seth Greenberg has been the head coach at South Florida for five seasons.
5) ``I've spent a lifetime talking basketball with Seth and sharing thoughts,'' Brad Greenberg said. ``That's another reason (joining USF) is so special.''
6) Brad Greenberg will report to athletic director Lee Roy Selmon.
7) He has been vice president of player personnel for the Portland Trail Blazers, an assistant coach for the Los Angeles Clippers and New York Knicks and a scout for Portland and the Orlando Magic.


McDonald's CEO's 2001 bonus unchanged at dlrs 1.2 million
(APW_ENG_20020405.1103)
1) McDonald's Corp. chairman and chief executive Jack Greenberg received a 2001 bonus of dlrs 1.2 million, unchanged from the previous year, according to a filing Friday with the Securities and Exchange Commission.
2) Greenberg's salary was dlrs 1.4 million last year, up slightly from the dlrs 1.3 million he got in 2000.
3) McDonald's said the annual bonuses paid to executives for 2001 were ``substantially'' below target because the company failed to achieve financial objectives.
4) The no. 1 U.S. hamburger chain said in March that Greenberg had agreed to remain as CEO for at least three more years. He's been a director since 1982 and chairman and CEO since 1999.
5) Greenberg was granted 675,000 stock options in 2001 with exercise prices of dlrs 29.43 and dlrs 28.90, the filing said.
6) In 2001, Greenberg exercised 150,000 stock options for a profit of dlrs 2.8 million. At the end of the year, he held 2.2 million vested options with an estimated value of dlrs 13.7 million as well as 2.8 million unvested options.


AIG asks NYSE, SEC to probe possible short selling
(APW_ENG_20020422.1343)
1) American International Group Inc. has asked the New York Stock Exchange and the Securities and Exchange Commission to investigate ``considerable short selling'' of its shares Monday.
2) The insurer said Monday it asked for an investigation of the activity after its stock traded down significantly.
3) Shares of AIG closed Monday at dlrs 69.71 on the Big Board, down dlrs 1.08, or 1.5 percent, on heavy volume.
4) AIG's shares were down as much as 4.7 percent earlier Monday as a trading floor rumor spread that the Securities and Exchange Commission may review the company.
5) Joe Norton, an AIG spokesman, told Dow Jones that the company doesn't comment on share price movement or market rumors as a matter of corporate policy.
6) AIG's first-quarter earnings are scheduled to be released April 25.
7) New York-based AIG is one of the world's largest insurance companies.


AIG reports earnings rise in first quarter, matching expectations By ADAM GELLER
(APW_ENG_20020425.1182)
1) Insurance giant American International Group Inc. reported a 6.7 percent increase in first-quarter earnings, boosted by rising premiums. The operating results matched analysts' expectations.
2) The New York-based company said Thursday its net income for the quarter was dlrs 1.98 billion, or 75 cents per share, up from dlrs 1.86 billion, or 70 cents a share a year ago.
3) Not counting costs resulting from losses in capital and a change in accounting rules, AIG said income rose 11.1 percent to dlrs 2.13 billion, or 81 cents per share, from dlrs 1.92 billion, or 72 cents a share during the same quarter of last year.
4) The 81-cent figure matched a consensus estimate of analysts surveyed by Thomson Financial/First Call.
5) The increase in earnings reflected moves by the company to raise premiums for its insurance customers across market sectors. In its worldwide general insurance business, premiums grew by 30.2 percent. In AIG's worldwide life insurance business, revenue from premiums swelled 15.4 percent.
6) ``AIG is off to a very good start in 2002,'' chairman Maurice R. Greenberg said in a written release.
7) ``In the property-casualty business around the world, rates are continuing to strengthen as we have indicated in prior quarters, helping to produce strong results from our general Insurance business in the quarter,'' he said.
8) In addition to collecting larger premiums, the percentage of those revenues being used to cover claims dipped in the quarter. The company's combined ratio _ the portion of each dollar that goes to paying out claims _ declined to 95.76 from 95.89 a year ago.
9) ``We expect rate and coverage improvements to continue for the foreseeable future,'' Greenberg said.
10) Operating earnings in AIG's general insurance business declined 1.9 percent to dlrs 933.3 million while income from its life insurance business rose 16.7 percent to dlrs 1.33 billion.
11) AIG said it continues to make progress in integrating American General Corp., the Houston-based insurance firm it bought last year. AIG said it is ``on or ahead of schedule'' in efforts to improve productivity and marketing and expects to meet or exceed its goal of dlrs 400 million in cost savings by 2003.


Organs of son of prominent American rabbi donated to six people
(APW_ENG_20020930.0695)
1) The organs of New York philanthropist Jonathan Greenberg, who was killed while biking in Israel, have been transplanted into six people, including a Palestinian man.
2) Greenberg, 37, was the son of prominent New York Rabbi Yitzhak Greenberg and feminist Blu Greenberg.
3) It marked the second time in a week that rabbis sanctioned organ transplants. Last week, a Jewish seminary student from Scotland who was killed in a Tel Aviv bus bombing had his organs transplanted.
4) Several years ago, Israel's Chief Rabbinate ruled that saving lives overrides the requirement to bury an intact body. Not all rabbis recognize the decision.
5) On Sunday, Greenberg's parents held an emotional meeting at an Israeli hospital with two men who received a kidney and cornea from their son. A Palestinian man, 51, from east Jerusalem received Greenberg's liver.
6) ``The meeting can't bring back our son and we can't get over what happened,'' Yitzhak Greenberg was quoted as saying by the Maariv daily. ``But on the other hand there is a feeling of happiness and we feel that Jonathan will continue to contribute to the lives of others.''
7) Greenberg was biking with a friend on a highway near Israel's coast on Sept. 13 when he was hit by a car and seriously injured. He died the next day.
8) He was the executive director of the U.S.-based Jewish Life Network, which support Jewish social and educational programs. Greenberg was buried in Jerusalem.
9) All recipients were recovering well, hospital officials said Monday.


McDonald's chairman to retire at year's end
(APW_ENG_20021205.0534)
1) McDonald's Corp. is replacing its chairman and chief executive, Jack Greenberg, as it struggles to emerge from a deep, two-year slump.
2) The fast food chain Thursday said Greenberg will retire at the end of this year after 21 years at the company. McDonald's board elected the company's president and vice chairman, Jim Cantalupo, to take over the top two spots.
3) McDonald's has reported lower earnings in seven of the past eight quarters and recently announced it is cutting back its expansion pace as it grapples with a crowded restaurant market, complaints about poor service and a depressed stock price. Several Wall Street analysts had been urging for months that Greenberg be replaced.
4) McDonald's stock price has lost about two-thirds of its value since Greenberg was named to the top job in 1998. Shares of McDonald's, which had been up nearly 3 percent before the announcement, were up 2 cents to $18.39 in afternoon trading on the New York Stock Exchange.
5) ``In every company's history, there is a time when it is appropriate to pass the baton and give a new management team the opportunity to lead, and that time has come at McDonald's,'' Greenberg said in a company news release.


AIG to take $1.8 billion charge
(APW_ENG_20030204.0317)
1) American International Group Inc. said it will incur a fourth-quarter net charge of $1.8 billion to boost reserves by $2.8 billion for general insurance net losses and loss-adjustment reserves.
2) The insurance and financial-services giant said late Monday that 60 percent of the reserve increase will be applied to excess casualty loss reserves, including excess workers' compensation.
3) About 25 percent is related to directors and officers insurance, in which AIG is the leading U.S. writer. The remaining 15 percent is related to other casualty, including health-care and medical malpractice insurance.
4) The charge is unrelated to asbestos reserves, which continue to be adequate, AIG said.
5) The company's $2.8 billion addition to reserves, despite its size, is a ``blip,'' not a major event for the company, its top executive said Tuesday.
6) On a conference call with analysts, M.R. ``Hank'' Greenberg, AIG's chairman, said the New York insurer took a more conservative approach in its annual year-end reserve review, in part due to a spike in losses in claims from 1997 to 2001. Greenberg attributed much of the spike to one of his pet peeves _ an out-of-control legal system and rising litigation costs.
7) If the company had taken its historic approach to reserves, the increase only would have been $700 million to $800 million less, Greenberg said. However, Greenberg felt more comfortable using the conservative approach.
8) Shares of AIG were at $50.50 in early trading Tuesday on the New York Stock Exchange, down $4.83, or 8.7 percent.
9) The company added that shareholders' equity at year-end 2002 will exceed the $58 billion reported at Sept. 30, despite the reserve charge.
10) AIG said general insurance business will continue to grow in 2003, with higher premiums both in the United States and overseas. Most premium growth is expected from rate increases, rather than additional risk exposures.
11) In January, new cash flow for investments from domestic general insurance operations reached $800 million. Cash flow for all of 2003 should substantially exceed that of 2002, the company said.
12) General insurance loss reserves are expected to grow between $4 billion and $5 billion in 2003.
13) AIG expects to post a return on equity of 15 percent in 2003.
14) AIG is expected to post fourth-quarter earnings excluding items of 91 cents a share, compared with 77 cents per share in the prior fourth quarter, according to a survey of analysts by Thomson First Call. The earnings are expected to be reported on Feb. 13.


Report: Grasso pressured firm to buy more AIG stock
(APW_ENG_20031003.0201)
1) Ousted New York Stock Exchange Chairman Dick Grasso pressured a floor-trading firm to buy more shares in American International Group Inc. after the insurer's chairman complained to him, according to a newspaper report.
2) Grasso made the suggestion to the firm after receiving written complaints from AIG Chairman Maurice Greenberg, a previous NYSE director, The Wall Street Journal reported in Friday editions, citing unnamed sources familiar with the matter.
3) Greenberg was a member of the NYSE's compensation committee that determined Grasso's $187.5 million pay package. Outrage over the size of the compensation led to Grasso's resignation two weeks ago.
4) Greenberg complained in an Oct. 23, 2002 letter to Grasso about Goldman Sachs Group Inc.'s Spear, Leeds & Kellogg unit, the ``specialist'' assigned to facilitate trading in AIG, the Journal said.
5) On multiple occasions following Greenberg's complaints, Grasso went to the trading floor and suggested that Spear increase its buying of AIG shares, the Journal said.
6) The Journal said buying the additional shares resulted in roughly $14 million in trading losses for Spear in the past few years.
7) Grasso declined to comment through a representative, the Journal said.
8) A call before business house Friday morning to a spokesman for the NYSE was not immediately returned.
9) Greenberg told the Journal that for years he has criticized the NYSE specialist system, which assigns firms to match buy and sell orders from investors. The specialist firms use their own money to buy shares when buyers and sellers do not agree on a price.
10) ``If I think the specialist is not doing the job he should be doing in buying stock when the stock is under pressure ... then I'm going to complain,'' Greenberg told the Journal, adding that it would be wrong to ``read something sinister'' into his actions.
11) A spokesman for Goldman Sachs told the Journal that Spear believed it had acted appropriately in the situation.


AIG to pay $126 million to settle two investigations as a third emerges
(APW_ENG_20041124.0271)
1) American International Group Inc., one of the biggest U.S. insurance companies, said Wednesday would pay $126 million (euro95.85 million) to settle allegations by federal authorities that it helped two customer companies commit accounting fraud.
2) Under an agreement awaiting Securities and Exchange Commission approval, AIG will pay $46 million (euro35 million) fine to the watchdog agency to settle issues surrounding transactions that helped regional bank PNC Financial Services Group Inc. pump up its earnings. AIG will also submit to an independent monitor who will examine certain transactions by the company between 2000 and 2004 to determine whether any related parties violated accounting rules to achieve certain results.
3) New York-based AIG will pay another $80 million (euro60.8 million) to the Department of Justice to settle a related investigation and avoid prosecution.
4) The tentative deal to wrap up those investigations came as The Wall Street Journal reported that said federal prosecutors in New York are investigating whether AIG Chairman Maurice "Hank" Greenberg manipulated the huge insurance company's share price in 2001 to save money on a big acquisition.
5) The U.S. Attorney's office in Manhattan is looking into whether Greenberg illegally interfered with his company's share price just before AIG's acquisition of insurer American General Corp. in August 2001, the Journal reported, citing people familiar with the matter.
6) Greenberg sought the help of the Dick Grasso, then chairman of the New York Stock Exchange, for help keeping the company's shares above a trigger price that would have requited AIG to pay more for Houston-based American General, the sources told the newspaper.
7) Grasso wasn't in the office that day, but the request was relayed to floor traders overseeing AIG stock, the sources said, though it was unclear if they interfered to shore up AIG shares.
8) The inquiry is in its early stages and may not result in criminal charges, the Journal said.
9) AIG spokesman Joe Norton told the newspaper, "Mr. Greenberg has not been contacted or interviewed by the U.S. Attorney's office, and therefore he has no ability to opine on what they are or are not investigating."
10) The insurer had previously disclosed that the SEC was considering suing it for civil securities fraud over several 2001 transactions it conducted with PNC, and that the Justice Department was weighing criminal prosecutions against it in both the PNC matter and one involving cell phone distributor Brightpoint Inc.
11) AIG settled the Brightpoint case with the SEC in September 2003, agreeing to pay a $10 million civil fine to resolve allegations that it fraudulently helped the company falsify its earnings report and hide losses. As in all SEC settlements, AIG neither admitted nor denied the allegations.
12) Brightpoint, based in Plainfield, Indiana, in late 2001 restated its earnings for the previous 3 1/2 years _ leading to shareholder lawsuits against the company.
13) The SEC's investigation of AIG's dealings with PNC are said to involve three 2001 transactions in which the Pittsburgh-based bank increased its earnings by shifting $762 million of poorly performing loans and other assets off its balance sheet, allegedly in violation of generally accepted accounting principles.
14) __
15) On the Net:
16) American International Group Inc.: http://www.aig.com
17) Securities and Exchange Commission: http://www.sec.gov
18) PNC Financial Services Group Inc.: http://www.pnc.com
19) Brightpoint Inc.: http://www.brightpoint.com


Report: AIG's concerns over accounting grow broader
(APW_ENG_20050325.0428)
1) American International Group Inc., one of the world's biggest insurance companies, is considering a move to clean up suspected accounting mistakes that may total as much as $3 billion (euro2.3 billion) from as many as 30 insurance transactions, The Wall Street Journal reported in Friday's editions.
2) The Journal, citing unidentified sources familiar with the case, said potentially problematic accounting now being examined is far broader than was believed just a week ago.
3) AIG has yet to assess an additional 60 transactions that internal investigators have identified as possibly problematic, one person familiar with the matter told the Journal. A number of senior AIG executives were aware of many of these transactions, which could subject them to regulatory scrutiny, the source told the newspaper.
4) Chris Winans, an AIG spokesman , told the newspaper the company had no comment.
5) Last week, questions over AIG's accounting of an insurance transaction with a Berkshire Hathaway Inc. unit led to the ouster of Maurice R. "Hank" Greenberg as AIG's chief executive after nearly four decades at the helm. Investigators continue to examine whether AIG misled investors by manipulating its books.
6) This week, AIG, which has pledged to cooperate with investigators, fired its chief financial officer and a senior reinsurance executive after they decided not to answer some questions on the grounds that their answers might be self-incriminating.
7) Though it's unclear how AIG might account for its mistakes, even a multibillion-dollar charge against earnings likely wouldn't damage its long-term financial stability, the Journal said. The company posted income of $11.04 billion last year on revenue of $98.61 billion.


SEC subpoenas senior executives in probe at AIG board
(APW_ENG_20050328.0534)
1) The Securities and Exchange Commission has sent subpoenas to a dozen executives at American International Group Inc. amid several probes into whether questionable transactions were used to improperly bolster the insurance titan's financial standing, a person familiar with the matter said Monday.
2) The person, speaking on condition of anonymity and confirming a report Monday in The Wall Street Journal, also said federal investigators were aware of 10 transactions that warranted review.
3) Meanwhile, the Journal, citing unidentified sources familiar with the case, said the AIG board overseeing an internal probe of the transactions could decide in the next few days whether to formally sever ties with Chairman Maurice R. "Hank" Greenberg. Greenberg, 79, was replaced as chief executive two weeks ago _ though retained as chairman _ as regulatory scrutiny mounted over a 2000 transaction that appeared to have been used to boost the company's reserves artificially. He had been at the company's helm for four decades.
4) Greenberg has since become frustrated that he may be chairman in name only, and could pre-empt any board action by retiring, the Journal said, citing a source. Through his lawyer, he declined to comment.
5) Greenberg is scheduled to give a deposition to New York Attorney General Eliot Spitzer on April 12. Should he refuse to testify, directors could force him out, as they recently did two other executives, including Chief Financial Officer Howard I. Smith, who refused to cooperate with investigators.
6) On Sunday, the company forced out another longtime executive, Michael Murphy, a confidante of Greenberg and an expert of tax matters who is based in Bermuda, the Journal reported citing unidentified sources. Murphy's attorney, Sean O'Shea, said Sunday that he had not been informed of his client's dismissal, and did not know whether Murphy had been notified.
7) AIG continues to "believe that the matters subject to review are unlikely to result in significant changes to the company's financial position," meaning shareholder's equity, said an AIG spokesman, Chris Winans.


Report: Greenberg resigned amid threat that AIG would be indicted if he was at the helm
(APW_ENG_20050401.0556)
1) Maurice Greenberg abruptly resigned as longtime chairman of American International Group Inc. amid a threat that the New York attorney general would indict AIG if he was still at the embattled company's helm as it faced growing government probes, The Wall Street Journal reported in Friday's editions.
2) The Journal, citing unnamed sources familiar with the case, said Attorney General Eliot Spitzer told AIG lawyers he was dismayed over what he called the "document caper."
3) In Bermuda last Friday, a lawyer for Greenberg, whose nickname is Hank, carted boxes of documents out of an AIG office and into a van, the sources told the Journal. The next day, lawyers hired by AIG to handle a regulatory probe discovered certain records were missing, and that an AIG employee had destroyed some computer records and tape recordings of business meetings, the sources said.
4) There was a confrontation between the lawyers for AIG and attorneys representing Greenberg over who should secure the rest of the documents, the Journal said.
5) Greenberg stepped down as chairman 48 hours after Spitzer threatened last Saturday that his office would indict AIG on Monday if action wasn't taken, the Journal said.
6) "As long as Hank's still the chairman, AIG is still accountable," Spitzer told AIG's outside lawyers on the phone last Saturday night from a Colorado skiing vacation, the Journal's sources said. "You have serious criminal exposure."
7) Some of AIG's independent directors argued Greenberg had to go immediately in order to protect the company, the Journal said. Those directors had essentially taken control of the company because of the investigations into whether AIG bolstered its financial condition with improper accounting.
8) Greenberg, 79, retired before he was forced out, the Journal reported. Through his attorney, David Boies, Greenberg declined to comment to the Journal. An AIG spokesman told the Journal the company declined to comment.


Munich Re representatives to meet New York attorney general in AIG probe
(APW_ENG_20050406.0430)
1) Representatives from Germany's Munich Re AG, the world's biggest reinsurer, are meeting with the New York attorney general's office in connection with the investigation into insurer American International Group, a company spokeswoman said Wednesday.
2) Attorney General Eliot Spitzer's office is looking into allegations of widespread accounting irregularities at AIG, though Spitzer said Monday that he believed a resolution could be reached without criminal charges.
3) Munich Re has been asked to provide information at the Wednesday meeting, spokeswoman Anke Rosumek said. She wouldn't comment further.
4) AIG's new chief executive Martin Sullivan _ who took the top post on March 14 after the board forced out longtime chief executive Maurice "Hank" Greenberg _ has said that he is cooperating fully with regulators.
5) AIG's shares have fallen nearly 30 percent since mid-February, when subpoenas by the regulators were disclosed.


SEC wins court order against AIG, ousted CEO to preserve documents in probe
(APW_ENG_20050408.0101)
1) Federal regulators investigating accounting lapses at American International Group Inc. on Thursday secured a court order compelling the insurance titan, its recently ousted CEO and a private company with ties to AIG to preserve documents and provide them to investigators.
2) An official of the Securities and Exchange Commission said the agency sought the protective order from the U.S. District Court in Manhattan in response to reports of documents having been removed from an AIG building in Bermuda, where the company has a subsidiary, or destroyed.
3) The order against AIG, its longtime CEO Maurice "Hank" Greenberg and C.V. Starr & Co. Inc. prohibits them "from interfering with the ability of the (SEC) to obtain any and all documents" in their possession or control. It also lays out a procedure for documents located outside the United States to be secured, brought to this country and provided to the SEC investigators and the office of New York Attorney General Eliot Spitzer, which also has been investigating AIG.
4) AIG, Greenberg and Starr consented to the order, the agency said.
5) In a widening probe, the SEC issued subpoenas to the three between March 25 and April 1. The agency said the court order was needed to preserve "the security, location and integrity" of documents relevant to the (SEC's) ongoing investigation" and sought in the subpoenas.
6) AIG's new chief executive, Martin J. Sullivan, acknowledged recently that documents located in Bermuda had been removed or destroyed. He said one Bermuda-based employee was terminated and several others resigned "for failure to cooperate with AIG's review."


Report: Documents for transaction at the center of probes were doctored
(APW_ENG_20050408.0574)
1) Documents for a reinsurance transaction that is at the center of federal and state probes into American International Group Inc. were doctored several months after the deal was struck, The New York Times reported Friday.
2) The Times, quoting unnamed "executives with direct knowledge of the transaction," said the deal was "repapered" by midlevel employees of General Re, a unit of Berkshire Hathaway.
3) The paper said the modification was detected by Berkshire Hathaway-hired lawyers doing an audit of General Re in connection with an unrelated case.
4) The Securities and Exchange Commission and New York Attorney General Eliot Spitzer are investigating the transaction, which occurred in the final quarter of 2000 and the first quarter of 2001, to determine if AIG improperly booked the deal to burnish its books.
5) AIG recently admitted that accounting for the deal was improper.
6) The former chief executive of New York-based AIG, Maurice "Hank" Greenberg, is scheduled to speak with regulators in New York on Tuesday. Billionaire investor Warren E. Buffett, who heads Berkshire Hathaway, will speak with regulators the day before.
7) Buffett is considered "a cooperating witness" and not a target of the probe, investigators told The Associated Press.
8) Greenberg was forced out as head of AIG in mid-March as allegations of accounting improprieties at the company mounted.
9) The Times said that the reinsurance transaction being investigated was initiated by Greenberg with Ronald E. Ferguson, former head of General Re.
10) Two General Re executives handled details with Christian M. Milton, who recently was fired by AIG for failing to cooperate with investigators. The two executives then passed on responsibility to John Houldsworth, head of General Re's office in Dublin.
11) "After Mr. Houldsworth was asked to manage the AIG transaction, a decision was apparently made at General Re to doctor the paperwork surrounding it," the Times said. It said that Houldsworth "oversaw the changes to the documents," quoting unnamed people with direct knowledge of the transaction.
12) AIG initially paid General Re $5 million (euro3.87 million) for services. After the "repapering," the documents made it appear that General Re paid $10 million (euro7.74 million) to AIG.
13) On Thursday, federal regulators secured a court order compelling AIG, Greenberg and a private company with ties to AIG to preserve documents and provide them to investigators.
14) An official of the SEC said the agency sought the order from the U.S. District Court in Manhattan in response to reports of documents having been removed from an AIG building in Bermuda, where the company has a subsidiary, or destroyed.
15) AIG, Greenberg and C.V. Starr & Co. Inc. consented to the order, the agency said.


NY Attorney General Spitzer says Buffett only a witness in AIG probe
(APW_ENG_20050411.0031)
1) Billionaire investor Warren Buffett is merely a witness who could "shed light" on transactions involving the former chief executive of insurer American International Group Inc., which is now at the center of federal and state probes, New York Attorney General Eliot Spitzer said.
2) Buffett, who heads Berkshire Hathaway, will meet Monday in New York with regulators as part of an investigation by Spitzer and the Securities and Exchange Commission into allegations of accounting improprieties at AIG involving a unit of Buffett's company.
3) The company's former CEO, Maurice "Hank" Greenberg, was forced out in mid-March as those allegations mounted. Greenberg is scheduled to speak with regulators on Tuesday.
4) "We believe (Buffet) can shed light on a series of transactions that ... Hank Greenberg participated in," Spitzer said in an interview with ABC's "This Week" television program.
5) Spitzer stressed that Buffet was "not a subject or a target of our investigation," but said, "There are some ambiguities that will be hopefully addressed (Monday) in our discussion with Mr. Buffett."
6) "He is a witness in our view, and the focus of this investigation is AIG and the much broader reach of the offshore entities that AIG has created that we believe were, in many respects, fraudulent," Spitzer said.
7) Buffett was subpoenaed in January and has said he would cooperate.
8) Berkshire Hathaway did not return a call seeking comment Sunday.
9) The New York Times reported Friday that documents from a 2000 reinsurance transaction at the center of the probes had been doctored several months after the deal was struck. The newspaper cited unnamed executives with direct knowledge of the transaction, who said the deal was "repapered" by midlevel employees of General Re Corp., a unit of Omaha, Nebraska-based Berkshire Hathaway.
10) The Times said the modification was detected by attorneys Berkshire Hathaway hired to audit General Re in connection with an unrelated case.
11) In a recent television interview, Greenberg's attorney David Boies said AIG's accounting neither greatly influenced the market nor misled people.
12) "Well, obviously I disagree with that," Spitzer said Sunday. "The evidence is overwhelming that these were transactions created for the purpose of deceiving the market. We call that fraud. It is deceptive. It is wrong. It is illegal."
13) Still, Spitzer would not say an indictment was forthcoming.
14) "We have powerful evidence. We will proceed with it," he said. "It could be civil. It could be criminal."
15) Last month, AIG acknowledged that it had improperly recorded transactions with General Re that served to boost its reserves.
16) Reinsurance traditionally has been used to spread risk among insurers but, in some cases, it has been used for the questionable purpose of polishing a company's financial statements. If there is no risk transfer, the deal shouldn't be booked as insurance.
17) In the case under review, AIG purchased reinsurance from General Re in the fourth quarter of 2000 and first quarter of 2001. Investigators have said that AIG used the deals to pump up its reserves when markets were uneasy about the company's outstanding liabilities.
18) When asked whether he believed Buffet's impeccable reputation will remain intact, Spitzer replied, "I sure hope so ... Warren Buffett is an icon. He has succeeded the right way. He stands for smart, long-term investing, transparency, accountability _ all those things we value and support."


Former AIG chief says he won't answer questions from securities regulators
(APW_ENG_20050412.0622)
1) The former chairman and CEO of embattled insurer American International Group Inc. isn't planning to answer questions from securities regulators in a deposition Tuesday, citing his constitutional rights.
2) However, regulators planned to forge ahead with questioning, even if Greenberg invoked his Fifth Amendment rights against self-incrimination. Greenberg was due to be deposed starting at midmorning.
3) "We have 40 pages of questions," said Joseph Fritsch, director of insurance accounting policy for the New York State Insurance Department. "We want to get them all on the record."
4) Fritsch said the government's case was bolstered by testimony from billionaire investor Warren Buffett on Monday. According to Fritsch, Buffett confirmed "that Hank knew about the deal" between AIG and General Re Corp., a unit of Buffett's holding company, Berkshire Hathaway Inc. That deal served to boost AIG's cash reserves and appease investors and analysts, the government claims.
5) Fritsch said Buffett did not give prior approval for the transaction, leaving the decision-making to his subordinates. Buffett was "very easygoing" in answering regulators' questions, Fritsch added.
6) Buffett had no comment on the substance of his testimony Monday. "I told them everything I know," Buffett said afterward.
7) Greenberg has been identified by regulators as a target of their investigation and said he would not cooperate unless the Securities and Exchange Commission and the New York attorney general's office narrowed the scope of their questions.
8) Greenberg lawyer David Boies said Monday the large number of transactions being examined and that fact that some occurred years ago "have precluded Mr. Greenberg from adequately preparing this testimony at this time."
9) Greenberg sounded a similar note in a statement issued Monday afternoon, noting that AIG is involved in millions of transactions each year, many about which he had no direct knowledge.
10) "I am willing to accept responsibility and to account for the performance of my duties, but I believe that good order and fairness require that I have an adequate opportunity to be advised of the issues to be investigated and to my alleged involvement therein," Greenberg said.
11) In a column in Tuesday's Wall Street Journal, Boies said Greenberg had asked to postpone the questioning to allow for more time to review the documents in the case, and to limit questions to the General Re transaction. Both requests were denied, Boies said. Investigators also would not allow Greenberg to object to questions or allow him access to a transcript of the deposition, or to make his own.
12) Greenberg, 79, had viewed the forum as an opportunity to defend himself against "leaked charges" in the media, Boies wrote.
13) "On the other hand, the risk of being set up by open-ended questioning before he had an opportunity to review documents concerning events many years ago was great," Boies wrote.
14) Fritsch said that if Greenberg invoked his Fifth Amendment rights, he may yet be subpoenaed again as regulators continue their investigation.
15) "We plan on calling other people in the organization (AIG)," Fritsch said, adding that new information could result in additional questions and a new subpoena for Greenberg.
16) Buffett spoke briefly to reporters as he left the Woolworth Building in lower Manhattan, where the SEC has an office. Asked whether General Re turned over documents in exchange for leniency, Buffett said, "No. We complied with the subpoena."
17) The investigators are looking into a number of reinsurance transactions, which involve insurance purchased by insurance companies like AIG. Reinsurance traditionally has been used to spread out risk among insurers but, in some cases, it has been used for the questionable purpose of polishing a company's financial statements.


AIG worker compensation payments to be investigated by NY attorney general
(APW_ENG_20050426.0677)
1) New York Attorney General Eliot Spitzer on Tuesday said he will audit American International Group Inc. over reports that AIG improperly booked workers' compensation premiums, providing an "unlawful benefit" to the company worth tens of millions of dollars.
2) Spitzer and the state Insurance Department are appointing a consultant to audit the company, one of the world's largest insurers, for conduct that Spitzer said appears to have happened over a decade and is now discontinued.
3) Spitzer said a 1992 AIG memorandum to top management reported the practice was illegal, a notice that followed similar warnings in previous years.
4) Spitzer and acting state Insurance Superintendent Howard Mills are looking at whether AIG booked premiums for workers' compensation coverage as premiums for general liability coverage. The result could be that AIG avoided paying its share into several workers' compensation funds.
5) AIG has been cooperating with the state officials on the issue, the attorney general's office said. To date, AIG has provided no evidence that it disclosed the practice to regulators or made restitution.
6) An AIG spokesman didn't immediately respond to a request for comment Tuesday.
7) In morning trading, AIG shares dropped 51 cents, or nearly 1 percent, to $51.25 on the New York Stock Exchange. That's at the low end of the $49.91 to $74.98 range for AIG stock in the past year.
8) The funds at issue are supposed to be used for the operations of the state Workers' Compensation Board and to provide certain other claim benefits for injured workers, Spitzer said.
9) The state of Connecticut also is looking into overpayments for workers' compensation insurance. In January, Connecticut Attorney General Richard Blumenthal sued Marsh & McLennan Companies Inc., a New York-based brokerage, and a unit of ACE Ltd. insurance company, which is headquartered in Bermuda, in connection with an $80 million state contract.
10) On Feb. 3, executives of ACE said they would seek dismissal of the suit, in which Blumenthal alleged the company paid "kickbacks" to secure the workers' compensation contract.
11) Marsh & McLennan was at the center of a probe by New York Attorney General Eliot Spitzer into bid rigging, price fixing and demanding incentive fees from insurance companies in exchange for sending more property and casualty business their way.
12) On Jan. 31, Marsh & McLennan agreed to pay $850 million in restitution to end Spitzer's investigation. Much of the money will go to policyholders hurt by the conflicts of interest. Marsh & McLennan also pledges to change its practices.
13) In his broad investigation of AIG, Spitzer is looking into a number of reinsurance transactions booked by New York-based AIG, one of the world's largest insurers. Reinsurance traditionally has been used to spread out risk among insurers but, in some cases, has been used for the questionable purpose of polishing a company's financial statements.
14) In the transaction at the center of the probe, AIG purchased reinsurance from General Reinsurance Corp. in the fourth quarter of 2000 and first quarter of 2001. Investigators have said that AIG used the deals to pump up its reserves when markets were uneasy about the company's outstanding liabilities.
15) AIG acknowledged recently that its accounting for the transaction with Gen Re "was improper and, in light of the lack of evidence of risk transfer, these transactions should not have been recorded as insurance."
16) Also Tuesday, The New York Times reported that AIG has uncovered at least $1 billion more in accounting problems. The paper cited unnamed "people briefed on the company's investigation."
17) An AIG spokesman could not immediately be reached for comment.
18) On March 30, AIG disclosed that it had improperly booked a number of transactions and said corrections for errors and omissions in its accounting would result in a reduction of about 2 percent of the company's $82.87 billion shareholders' equity, or about $1.7 billion.
19) AIG has promised to file its delayed annual report by the end of April.


Insurance firm ACE continues internal investigation into finite-risk insurance
(APW_ENG_20050427.1250)
1) Evan Greenberg, president and chief executive of insurance firm ACE Ltd., said Wednesday that his insurance company's internal investigation into finite-risk insurance products is nearing completion but so far has found no accounting irregularities.
2) Greenberg, speaking on a call with analysts about the Bermuda-based firms' first-quarter earnings, said contracts studied to date appear "generally structured in a way to provide for appropriate risk transfer and accounted for properly."
3) He said the company's internal investigation "should be concluded in about a month's time."
4) ACE is among a number of insurance companies that have been subpoenaed by New York Attorney General Eliot Spitzer, the Securities and Exchange Commission and state insurance commissioners in a wide-ranging probe into these specialized insurance products.
5) Finite-risk and other reinsurance products are often used by insurance companies to share risk, but regulators have charged that some deals were used simply to burnish company finances.
6) Greenberg's father, Maurice "Hank" Greenberg, was forced out as chairman and CEO of the New York-base American International Group Inc. earlier this year in part because of questions about a reinsurance deal with Berkshire Hathaway Inc.'s General Re Corp.
7) Evan Greenberg said ACE was "continuing to cooperate fully on all the investigations."
8) Asked by an analyst if he might get caught up in the AIG probe because of his earlier employment at AIG, Greenberg said: "We have no indication that I am the focus of attention."
9) He also disclosed that an earlier internal investigation into business practices had uncovered some problems.
10) "We discovered a few examples of behavior that we would consider to be inconsistent with" ACE standards of conduct, Greenberg said. "We've taken appropriate action to ensure such conduct does not recur."
11) Greenberg gave no details, and a company spokesman said he could not elaborate on Greenberg's comments.
12) ACE was implicated, but not charged, in connection with Spitzer's probe of insurance brokers such as Marsh & McLennan Companies Inc. over bid-rigging and the use of incentive fees to steer business. A former executive of ACE Financial Solutions Inc. is among 10 insurance executives who have entered guilty pleas in the case.
13) ACE shares rose $1.87, or 4.7 percent, to close at $41.49 in Wednesday trading on the New York Stock Exchange. The stock has traded in a range between $31.80 and $47.70 in the last year.
14) In its earnings report, released late Tuesday, ACE said profits fell slightly in the first quarter, but results topped expectations when losses and gains from the sale of investments are excluded.
15) Quarterly income was $422 million (euro326.6 million), or $1.46 per share, down from $436 million, or $1.53 per share, in the year-ago period. Before the payment of preferred dividends, net income decreased to $433 million from $447 million. Excluding realized losses in the latest quarter and gains a year ago, operating earnings rose to $1.49 per share from $1.40.
16) Ace's earnings topped the average estimate of $1.46 per share from analysts surveyed by Thomson Financial.


American International Group review to result in $2.7 billion equity adjustment
(APW_ENG_20050502.0610)
1) American International Group Inc., one of the world's largest insurance companies, announced that it will again delay filing its 2004 annual report and make accounting adjustments that will cut its value by some $2.7 billion (euro2.1 billion) _ $1 billion (euro780 million) more than an earlier estimate.
2) Shareholders, apparently relieved that New York-based AIG is dealing with problems that have drawn regulatory scrutiny, bid the company's shares up. AIG shares rose $2.92, or nearly 6 percent, to $53.77 in morning trading on the New York Stock Exchange.
3) But Fitch Ratings agency downgraded AIG's long-term credit rating to AA from AA-Plus and kept the company on its credit watch negative list.
4) Fitch analyst Julie A. Burke said the downgrade was in response to "the additional delay as well as the slightly higher number with regard to accounting restatements."
5) In a statement late Sunday, the company said it will restate its results for the years 2000 to 2003 and delay filing its 2004 annual report until "no later than May 31." The company had twice earlier delayed filing its Form 10-K with the Securities and Exchange Commission.
6) AIG said the review by a team of independent auditors as well as its outside audit firm, PricewaterhouseCoopers LLP, was "nearing completion."
7) It said in the statement that AIG expects PricewaterhouseCoopers to give it "unqualified audit opinions" on its revised, consolidated financial statements. But it said that PwC would likely issue an "adverse option with respect to AIG's internal control over financial reporting."
8) The company admitted in its statement that some of the accounting problems were the result of mismanagement.
9) "As a result of its internal review, AIG management has identified certain control deficiencies, including the ability of certain former members of senior management to circumvent internal controls over financial reporting in certain instances," the statement said. It also acknowledged "ineffective controls" for accounting for certain transactions.
10) Although the reduction in shareholder value of $2.7 billion (euro2.1 billion) is among the highest ever recorded by a company, it represents just 3.3 percent of the insurance giant's $82.87 billion (euro64.43 billion) in shareholder equity as of last Dec. 31.
11) The latest statement expands on a previous report issued March 30 in which AIG delayed its annual report and acknowledged a series of accounting problems, including an admission it had improperly booked transactions with General Re, a unit of Berkshire Hathaway Inc., that artificially boosted its reserves.
12) Federal regulators are investigating the reinsurance transaction.
13) AIG earlier said that its purchase of reinsurance from General Re in the fourth quarter of 2000 and the first quarter of 2001 was improperly booked as insurance.
14) The broadening investigation led AIG to oust longtime chief executive officer, Maurice "Hank" Greenberg, earlier this year.
15) Martin Sullivan, named AIG's president and CEO after Greenberg's ouster, said in the statement issued Sunday that the company is "working diligently" to complete a new filing and that they will assure "accurate financial statements, rigorous accounting, greater transparency and thorough disclosure."
16) In the latest report, AIG said that among the accounting adjustments and corrections that will reduce its value were:
17) _ $1.2 billion (euro930 million) for incorporating the reinsurance activities of Union Excess Reinsurance Company Ltd. as deposits on its books, acknowledging its "ownership interests" in the Barbados-based company.
18) _ $300 million (euro233 million) for its Domestic Brokerage group, saying that allowances for doubtful accounts "were not properly recorded in the consolidated financial statements."
19) _ $100 million (euro77.7 million) for accounting for so-called life settlements, which are ways to help elderly people pull money from their policies.
20) _ $200 million (euro155.5 million) for "the incorrect application of accounting principles" related to deferred acquisition costs.
21) AIG also said that it would bring accounting for its hedging activities in line with accepted standards, resulting in a $2.4 billion (euro1.9 billion) increase in shareholders' equity.


Report: Former AIG chief called target of stock inquiry
(APW_ENG_20050506.0674)
1) U.S. prosecutors are investigating whether the former chief executive of American International Group headed an effort to manipulate the company's stock price in his final weeks as CEO of one of the world's largest insurance firms, the New York Times reported Friday.
2) The Times, citing unidentified people officially briefed on the inquiry, said an executive with the company's trading group told the company late last week that he had talked with former CEO Maurice R. Greenberg about AIG's stock price in February, when it had begun to fall sharply.
3) People who listened to a recording of the conversations say Greenberg can be heard instructing the trader to buy shares of AIG, the newspaper said. Such purchases may violate federal securities law.
4) The conversations between the trader and Greenberg were captured on a recording system used by the trading division, the sources said. The recordings were reviewed by the company and its lawyers, and then turned over to prosecutors with the U.S. attorney's office in Manhattan and the Securities and Exchange Commission.
5) Federal prosecutors have since subpoenaed all of AIG's recordings from its trading group, which are said to date back as much as two years, the sources said.
6) Megan Gaffney, a spokeswoman for federal prosecutors in Manhattan, said Friday the office had no comment.
7) Since the beginning of the year, federal and state officials have been examining transactions AIG used to make its financial position appear stronger than it really was.
8) Greenberg remains a focal point in the investigation despite being forced to step down as head of the company. Greenberg, who turned 80 on Wednesday, resigned as chief executive of AIG on March 14 and as chairman later that month.
9) "We cannot comment because we don't have the tapes, transcripts nor the substance of the conversation contained on them," Howard Opinsky, a spokesman for Greenberg's legal team told the Times.
10) Greenberg has not been accused of wrongdoing by regulators, but he has previously been investigated in connection with possible market manipulation.
11) The SEC, the New York attorney general's office, the New York Insurance Department and the Justice Department have been examining Greenberg's role in initiating a transaction with General Re, a reinsurance subsidiary of Berkshire Hathaway Inc., that allowed AIG to bolster reserves artificially against future claims _ an important measure of an insurer's strength.
12) AIG said in late March that it did not account correctly for that transaction and others. An AIG spokesman declined to comment to the Times Thursday on the latest investigation. The company is cooperating with all inquiries.


Report: New York grand jury investigates AIG for criminal conduct
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1) A grand jury is probing potentially criminal conduct by individuals at insurer giant American International Group Inc., including former top management.
2) This week, attorneys from New York Attorney General Eliot Spitzer's office began offering evidence to the jury that could result in criminal indictment of one or more individuals, The Wall Street Journal reported on its Web site late Friday. The newspaper attributed its information to unnamed people familiar with the case.
3) According to these unnamed sources, the company isn't a criminal target of the grand jury, which is slated to last about a month.
4) AIG senior executive Joseph Umansky has testified before the grand jury, the Wall Street Journal reported. AIG's former longtime CEO and chairman Maurice R. "Hank" Greenberg and former Chief Financial Officer Howard I. Smith are expected to be the focal point of the grand jury investigation.
5) The SEC, the New York attorney general's office, the New York Insurance Department and the Justice Department have been examining Greenberg's role in initiating a transaction with General Re, a reinsurance subsidiary of Berkshire Hathaway Inc., that allowed AIG to inflate reserves against future claims _ an important measure of an insurer's strength.
6) AIG said in late March that it did not account correctly for that transaction and others.
7) Officials at AIG and the New York Attorney General's office declined to comment to The Associated Press.


Greenberg resigns from board of insurer AIG
(APW_ENG_20050609.0468)
1) Maurice "Hank" Greenberg has resigned from the board of American International Group Inc., the company he built into one of the world's largest insurers.
2) Greenberg, 80, announced late Wednesday he was stepping down, effective immediately.
3) "My decision to resign now results from my inability to receive information regarding the company and its operations necessary to fulfill my fiduciary duties," Greenberg, who led AIG for nearly 40 years, wrote in a four-sentence letter.
4) AIG's board forced Greenberg to relinquish his posts as president and CEO on March 14, and he retired as the company's chairman two weeks later.
5) Greenberg had previously said he would not stand for re-election as a director, and in April the company named two new outside members to its board.
6) New York regulators have filed a civil lawsuit against AIG, Greenberg and former Chief Financial Officer Howard I. Smith, saying they orchestrated an accounting scheme that made the company's financial picture appear brighter than it was, misleading both investors and regulators.
7) A spokesman for Greenberg's legal team, Howard Opinsky, did not immediately return a call seeking comment.
8) Last week, the New York-based company finally filed its 2004 annual report with regulators. It lowered its reported income by nearly $4 billion (euro3.25 billion) for the last five years and cut shareholders' equity by $2.26 billion (euro1.83 billion), or 2.7 percent, to $80.61 billion (euro65.41 billion) as of Dec. 31, 2004.


Vietnam says insurance giant AIG will get general insurance license by end of 2005
(APW_ENG_20050624.0083)
1) Vietnam's finance minister delivered a welcome gift to the chairman of the beleaguered insurance giant, American International Group Inc., on Thursday night _ the promise of a general insurance license by the end of 2005.
2) When that happens, AIG's new chief executive, Martin J. Sullivan, said AIG will become the first U.S. company to get a license to sell non-casualty insurance in Vietnam which includes insuring property, liability risk, marine and aviation operations.
3) Finance chief Nguyen Sinh Hung handed Sullivan a letter of invitation to visit Vietnam in the next six months at a dinner honoring Vietnamese Prime Minister Phan Van Khai which was co-hosted by AIG, the Asia Society and the Vietnam Chamber of Commerce and Industry.
4) But it was only after the dinner ended and the Vietnamese delegation had left the Starlight Roof at the Waldorf Astoria Hotel that Sullivan opened the letter and learned the good news.
5) "What the minister of finance confirmed was that we would receive a non-life license before the end of 2005, so we're absolutely delighted," Sullivan told two reporters.
6) AIG already has a license to sell life insurance in Vietnam, "so we will now have two licenses by the end of 2005," he said.
7) "We're looking forward to growing our business in Vietnam. We're very excited about it," Sullivan said.
8) AIG is currently under investigation by state and federal regulators over accounting issues.
9) Last month, New York regulators filed a civil lawsuit against AIG and the company's former chief executive officer, Maurice "Hank" Greenberg, and former Chief Financial Officer Howard I. Smith, saying they orchestrated an accounting scheme that made AIG's financial picture appear brighter than it was, misleading both investors and regulators.
10) Greenberg, 80, resigned as chief executive officer and chairman of AIG in March, ending nearly 40 years at the helm of the insurance company. Smith was fired later for failing to cooperate with investigators.
11) Sullivan, who replaced Greenberg as president and chief executive officer, said at the time that the company was cooperating fully with investigators. "AIG's financial position is sound, our insurance cash flow is strong and our global franchise is unmatched," he said.
12) Sullivan said the company, with 92,000 workers worldwide, had embarked on "a new era" that would improve the way the company operates and contribute to future growth.
13) Asked Thursday night how much the second Vietnamese license for general insurance would be worth, Sullivan replied, "We'll first establish our business there, and we'll grow it in the right fashion."
14) "It's just been a culmination of many years of hard work by a number of people and we're absolutely delighted to be there," he said. "It was a very important envelope that the minister of finance handed across to me. ... It means a lot to us."


AIG's first-quarter results beat analysts' estimates
(APW_ENG_20050629.0662)
1) American International Group Inc., one of the largest U.S. insurance companies, said first-quarter earnings were 20 percent higher than a year ago, which was a stronger performance than analysts had expected.
2) The New York-based insurer, which is under investigation by state and federal regulators over accounting issues, had delayed issuing its report for the January to March period because of an internal review that resulted in a restatement of financial results for the past five years. The revised figures, including restated 2004 results, were released May 31.
3) In its report on the first quarter, released late Tuesday, AIG said net income totaled $3.19 billion (euro2.65 billion), or $1.21 a share, up from restated profits of $2.66 billion (euro2.21 billion), or $1.01 a share, in the first quarter of 2004.
4) The latest results were above the $1.18 projected by analysts surveyed by Thomson Financial.
5) AIG said shareholder equity totaled $82.68 billion (euro68.6 billion) at the end of the first quarter, up from $80.61 billion (euro66.87 billion) at year's end.
6) Martin J. Sullivan, AIG's president and chief executive officer, termed it a good quarter, "with all four of our business segments contributing to the growth in net income."
7) The company's operating divisions are general insurance, life insurance and retirement services, financial services and asset management.
8) In the restatement of its earnings in May, AIG acknowledged accounting improprieties, some apparently intended to deceive regulators.
9) Last month, New York Attorney General Eliot Spitzer filed a civil suit that accused AIG along with former Chairman Maurice "Hank" Greenberg of using "deception and fraud" to boost the company's stock price.
10) Greenberg's legal team also said Tuesday that Greenberg's wife has transferred more than $2 billion (euro1.66 billion) worth of company stock back to a joint account with her husband, three months after he gave her the shares as a gift.
11) Greenberg's shift of 41.4 million shares to his wife prompted Ohio regulators to file a complaint that the gift was a "fraudulent conveyance" to shield assets. It also had become an issue in shareholder lawsuits.
12) Late Monday, AIG filed its delayed annual proxy with the Securities and Exchange Commission and set the date of its annual meeting for Aug. 11.


Insurer AIG again restating finances, now to 2002, in ongoing accounting probe
(APW_ENG_20051109.0770)
1) American International Group Inc. shares slipped in early trading Wednesday after the insurance behemoth said that it would again be forced to restate financial results as part of a prolonged internal probe of its accounting practices.
2) The company also said in a middle-of-the-night announcement that it would delay its third quarter earnings report until next Monday, but did release preliminary estimates that included $1.57 billion (euro1.34 billion) in losses from Hurricane Katrina and other natural disasters.
3) AIG, which is headquartered in New York, restated five years of results in late May and cut shareholders' equity by $2.26 billion (euro1.93 billion).
4) In the latest round, blamed on the accounting for derivatives and other hedging mechanisms, AIG said it will restate annual financial results for 2002, 2003 and 2004. The company also will restate some financial data for 2000 and 2001 and quarterly financial information for 2004 and the first two quarters of 2005.
5) "AIG's prior financial statements for those periods should therefore no longer be relied upon," AIG said in a statement.
6) Further investigation by PricewaterhouseCoopers LLP uncovered the additional errors, AIG spokesman Chris Winans said. AIG, one of the world's largest insurers, said the errors had caused it to understate previous consolidated results by $500 million (euro426 million), forcing the restatement of its 2002, 2003 and 2004 fiscal years.
7) "It's a reflection of continued deeper due diligence," Winans said of the new restatement. "We're in the process of remediating our internal controls weaknesses."
8) AIG said that the problems related in part to "accounting for derivatives and related assets." It added: "AIG continues to believe its hedging activities have been and remain economically effective, but do not qualify for hedge accounting treatment."
9) In its estimate of third-quarter performance, AIG said net income will be $1.7 billion (euro1.45 billion) for the July-September period and about $10.1 billion (euro8.6 billion) for the first nine months of 2005. Adjusted net income, including substantial losses from hurricanes but excluding capital gains, will be $1.8 billion (euro1.5 billion) for the quarter and $8.3 billion (euro7.1 billion) or the first three quarters of 2005.
10) A year ago, AIG reported net income in the third quarter of $2.51 billion, or 95 cents a share. Adjusted net income was $2.54 billion, or 97 cents a share.
11) The company estimates its losses from claims due to hurricanes Katrina and Rita as well as other storms will be about $1.6 billion (euro1.36 billion), or $1.23 per share. AIG previously estimated its storm losses at about $1.1 billion (euro940 million).
12) The accounting issues surfaced in the spring, as federal and state regulators began investigating the industry's accounting practices and certain transactions AIG conducted with other insurers.
13) Those probes led to the ouster of former Chairman and Chief Executive Officer Maurice "Hank" Greenberg, and a civil lawsuit by New York Attorney General Eliot Spitzer in May. The suit against AIG and Greenberg alleged "deception and fraud" in the accounting as a way to boost the company's financial results and stock price.


NY Attorney's office: More civil claims 'possible' against AIG's former boss
(APW_ENG_20051125.0758)
1) Additional civil charges against former American International Group Inc. Chairman and CEO Maurice "Hank" Greenberg are possible, but no state criminal charges are expected, a spokesman for New York Attorney General Eliot Spitzer said Friday.
2) "The office decided months ago to pursue the case as a civil matter," said Spitzer spokesman Darren Dopp when asked if criminal charges were possible.
3) "An amendment to the civil complaint is possible, but no final decision has been made," Dopp said Friday.
4) On Friday, The Wall Street Journal reported that a person familiar with the matter said Spitzer is expected to add to his civil complaint against Greenberg as early as next week.
5) Criminal charges are still possible, however, from federal prosecutors in two separate investigations of Greenberg, the newspaper reported. Greenberg's attorney already has argued against any charges to the federal prosecutors, the newspaper reported, citing two knowledgeable sources.
6) Spokesmen for Greenberg's lawyer wouldn't comment in the report. Greenberg's attorney and AIG spokesmen were unavailable Friday to return calls requesting comment.
7) Spitzer's spokesman says the decision months ago not to pursue criminal charges is not a retreat, but rather the result of choosing to pursue action as a civil case.
8) Spitzer, who is running for New York governor in 2006, suffered a setback in his attempts to reform the mutual-fund industry in June when a jury acquitted former Bank of America Corp. broker Theodore C. Sihpol III of 29 counts of improperly trading mutual-fund shares after hours and couldn't come to a decision on four other charges.
9) Spitzer dropped another set of criminal charges on Monday in his mutual-fund trading investigation.
10) The suit against AIG and Greenberg alleged "deception and fraud" in the accounting as a way to boost the company's financial results and stock price. Greenberg has repeatedly denied wrongdoing. Greenberg ran the company for 38 years.
11) In late May, AIG restated five years of results after Spitzer began investigating whether the company was using accounting tricks to boost its stock. Adjustments earlier this month had a positive impact on AIG's balance sheet, raising retained earnings some $490 million (euro416 million) higher as of Sept. 30.
12) The accounting probes led to the ouster of Greenberg and a civil lawsuit by Spitzer in May.


New York Attorney General Spitzer says Greenberg shorted a foundation by $6 billion
(APW_ENG_20051215.0114)
1) New York Attorney General Eliot Spitzer on Wednesday accused embattled insurance executive Maurice R. "Hank" Greenberg of participating in a series of financial transactions 35 years ago that cost the charitable foundation of his mentor $6 billion (euro5 billion).
2) Spitzer's allegations were contained in a letter delivered Wednesday to the president of The Starr Foundation. They represent the latest escalation of his battle with Greenberg, who resigned in March as the chairman and chief executive of American International Group Inc. amid widening federal and state probes of accounting irregularities at the world's largest property and casualty insurance company.
3) The Starr Foundation's 2003 tax return filed with the Internal Revenue Service listed assets of $3.6 billion (euro3 billion), made up mostly of shares in AIG, and showed that it made more than $188 million (euro156.4 million) in charitable donations that year. The bulk of those were grants to colleges and tuition payments made for students.
4) The attorney general urged the foundation to take civil action against Greenberg and suggested he would do so if they don't act by the end of January to recover the assets and reconstitute its board "to guarantee it the independence needed to advance its charitable mission into the future."
5) Spitzer alleged in the letter that records obtained by court order from AIG's Bermuda offices show that three transactions in 1969 and 1970 were rife with conflicts of interest that harmed the interests of the charitable foundation.
6) "Mr. Greenberg directed a series of transactions that deprived The Starr Foundation of billions of dollars in assets," said Spitzer spokesman Darren Dopp. "Whether that improper conduct occurred yesterday or years ago doesn't matter. There is no sunset on fiduciary obligations."
7) In a statement, Greenberg and three other living executors of the estate said the transactions were approved nearly 30 years ago by the New York Attorney General's Office, the Internal Revenue Service and the state courts when the estate was closed.
8) "Each of us fulfilled our duty to Mr. Starr and the foundation without compensation and in accordance with his wishes and the law," the statement said. "Mr. Spitzer's attempt to infer improper intent _ 37 years after the events in question, on a record eroded by time and long after the statute of limitations has expired _ is absurd and politically suspect."
9) Spitzer said Greenberg was an executor of the estate of his mentor, Cornelius Vander Starr, who created a worldwide network of insurance companies including AIG in the early 1900s. Starr died Dec. 20, 1968 and Greenberg was one of the executors of the estate, according to Spitzer's letter.
10) In 1969 and 1970, the estate sold Starr's shares in American International Underwriters Far East Inc., C.V. Starr & Co. Inc. and Starr International Co. The shares were purchased by C.V. Starr & Co. Inc. and Starr International Co., which were owned and controlled by Greenberg and other close associates of Starr, according to the letter.
11) Spitzer claimed the executors of the estate sold the stock at low prices, then C.V. Starr & Co. Inc. and Starr International Co. sold them at much higher prices to AIG, enriching the Starr companies and the executors at the expense of the foundation, Spitzer said.
12) Greenberg remains in control of the Starr companies and is chairman of the board of the foundation, Spitzer said. The value of the shares in those years-old transactions have the equivalent value today of more than $6 billion (euro5 billion) and Spitzer suggests those funds rightfully belong to the foundation.
13) The foundation issued a statement disagreeing with Spitzer's findings.
14) "While The Starr Foundation respects the authority of the attorney general to supervise charitable foundations and to investigate alleged improprieties, the foundation is concerned that allegations concerning a judicial proceeding closed more than 25 years ago and the negative publicity attendant thereto may adversely affect the value of the assets of the foundation, without discernible purpose," the foundation said.
15) In recent Securities and Exchange Commission filings, Greenberg describes Starr International as a holding company for interests in commercial real estate, a private golf club and manager of an investment portfolio.
16) AIG's most recent proxy statement listed Starr International as the owner of 310.9 million, or almost 12 percent, of AIG's shares. The value of those shares was $20.6 billion (euro17.14 billion) based on Wednesday's closing stock price.
17) Control of Starr International, which also previously operated a deferred compensation profit participation plan for the benefit of AIG executives, is currently the subject of a legal battle between AIG's board of directors and Greenberg.
18) Spitzer said the relevant documents outlining the 1969 and 1970 transactions were removed from AIG's Bermuda office in late March by Greenberg's layers. Spitzer later received the records by court order.
19) Spitzer, who is running for New York governor, explained his interest in the years-old transactions by saying state law makes the Attorney General's Office responsible for ensuring that the beneficiaries of charitable foundations derive the full and fair value of foundation assets.
20) In their statement, Greenberg and the executors added: "The people of New York deserve an attorney general who is intent on fighting crime and solving the state's problems, not harassing its citizens and philanthropic organizations."


Reports: U.S. insurer AIG close to $1.5 billion settlement with regulators
(APW_ENG_20060206.0668)
1) American International Group Inc., the giant property-casualty insurer under investigation for deceptive accounting practices, is close to reaching a $1.5 billion (euro1.25 billion) deal with federal regulators to settle the allegations, The Wall Street Journal and The New York Times reported Monday.
2) The Journal quoted unnamed "people familiar with the matter" as saying the deal, which could be announced as early as this week, would settle investigations by the Securities and Exchange Commission, New York State Attorney General Eliot Spitzer and the New York State Insurance Department.
3) The Journal said the payment of at least $1.5 billion (euro1.25 billion) "would include disgorgement of allegedly ill-gotten gains and penalties." The New York Times put the cost of the settlement at about $1.6 billion (euro1.34 billion), quoting "two people briefed on the negotiations."
4) Christian Murray, spokesman for New York-based AIG, said the company had no comment on the reports.
5) There was no immediate comment from Spitzer's office or the SEC.
6) In morning trading, AIG shares rose 90 cents, or 1.4 percent, to $66.25 on the New York Stock Exchange. AIG shares have traded in a range of $49.91 to $73.80 over the past 52 weeks.
7) Spitzer on May 26 accused AIG and two former top executives of using unacceptable accounting tactics to make the company's financial performance appear better than it was, misleading both investors and regulators. The suit in state Supreme Court in Manhattan also alleges that AIG's former chief executive officer, Maurice "Hank" Greenberg, and former chief financial officer, Howard I. Smith, orchestrated the scheme.
8) Greenberg, who resigned from AIG in March, has repeatedly insisted that he followed proper accounting procedures during his 38 years at the helm of AIG. Smith too has denied wrongdoing.
9) Howard Opinsky, a spokesman for Greenberg, said Monday that "shareholders lose when companies choose to settle investigations that are motivated by political ambition, fueled by threats and settled out of fear."
10) He added: "Even if all the allegations were to be believed, a settlement of this magnitude is totally disproportionate to the impact of the alleged misconduct."
11) The company, operating under its new CEO, Martin J. Sullivan, last year restated AIG's earnings back to 2000, cutting shareholder equity by some $2 billion (euro1.67 billion).
12) The Journal said a $1.5 billion (euro1.25 billion) settlement with AIG would exceed the SEC's $750 million (euro626 million) settlement with WorldCom Inc. in 2003 over accounting charges. Last year, Spitzer reached an $850 million (euro709 million) agreement with Marsh & McLennan Companies to settle bid-rigging and price fixing allegations.
13) Federal and state regulators have won massive settlements from financial institutions in recent years. Citigroup Inc. paid $2.6 billion (euro2.17 billion) and JPMorgan Chase & Co. paid $2 billion (euro1.67 billion) toward a more than $6 billion (euro5 billion) settlement of suits brought after the collapse of WorldCom. The company now operates as MCI Inc. Shareholder suits also are pending against AIG.
14) __
15) On the Net:


Four U.S. insurance industry executives plead not guilty to fraud charges
(APW_ENG_20060216.1210)
1) Four former top executives of insurance giants General Re and American International Group pleaded not guilty to federal fraud and conspiracy charges Thursday and pledged $1 million (euro840,000) in bond each as their trial was set for May.
2) The Justice Department has accused the four of orchestrating an audacious fraud, putting together a sham reinsurance transaction that allowed AIG to falsely report some $500 million (euro422 million) in reserves against losses and thereby mislead shareholders, Wall Street and regulators. The charges against the executives come as the government's investigation of the insurance industry widens.
3) The alleged conspiracy, using phony contracts and a secret side deal, was designed to make it appear that AIG's loss reserves were growing so as to inflate the company's stock price in 2000 and 2001, prosecutors say.
4) Appearing in federal court in Alexandria were: Ronald Ferguson, who was chief executive of Berkshire Hathaway Inc.'s General Re; Elizabeth Monrad, its former chief financial officer; Robert Graham, the company's former assistant general counsel; and Christian Milton, who ran the reinsurance division of AIG.
5) By turns, they stood before U.S. District Judge Gerald Bruce Lee and replied "Not guilty" when asked how they were responding to the charges. They also said they wanted a jury trial rather than a hearing with only a judge.
6) Each pledged a $1 million bond and surrendered his or her passport. Lee set a trial date of May 22, saying it likely would last about 16 days.
7) Each defendant, if convicted on all 13 criminal counts of conspiracy, fraud and making false statements to the Securities and Exchange Commission, could face a maximum 95 years in prison and $7.75 million (euro6.54 million) in fines.
8) New York-based AIG, one of the world's largest insurance companies, last week agreed to pay a record $1.64 billion (euro1.38 billion) in a settlement with federal and New York state authorities. It also apologized for having deceived investors and regulators with misleading accounting practices.
9) AIG was alleged to have taken part in bid-rigging schemes, paid secret commissions to insurance brokers to steer business to it, used phony insurance deals to burnish its earnings and misstated the amounts of workers' compensation premiums it had collected.
10) The company's ousted chief executive, Maurice "Hank" Greenberg, remains under investigation by the Justice Department and the SEC, and has been named in a civil lawsuit by New York Attorney General Eliot Spitzer.
11) Greenberg, though not named, is referred to as "AIG unindicted co-conspirator 1" and portrayed as playing a role in the sham transaction in the indictment handed up this month by a federal grand jury in Norfolk, Va.
12) Greenberg has denied any wrongdoing. He has said that transactions made during his 38 years at the helm of AIG were proper and correctly accounted for, and his spokesman says he will be vindicated in the courts.
13) Ferguson, Monrad, Graham and Milton also are named in a related civil lawsuit by the SEC alleging that they aided AIG's alleged securities fraud.
14) General Re parent Berkshire Hathaway, an investment company based in Omaha, Nebraska, is led by influential billionaire Warren Buffett.
15) Prosecutors say AIG had been concerned about Wall Street analysts' suggestions that it had insufficient reserves to cover potential losses and approached General Re to facilitate a deal that would increase its loss reserves on paper. But the deal had no substantive value, did not transfer risk, and was designed to cosmetically alter AIG's books, according to the indictment.
16) "While the $500 million boost to AIG's reserves may have been good reading, it was pure fiction," Assistant U.S. Attorney General Alice Fisher said at a news conference announcing the indictment.
17) "The investigation absolutely is continuing," she said.
18) Two other former executives of Stamford, Connecticut-based General Re _ John Houldsworth and Richard Napier _ pleaded guilty in June to roles in the sham deal. As part of their plea bargains, they have been aiding the investigation.


AIG uses subsidiaries to contribute beyond limit to candidates
(APW_ENG_20060919.0400)
1) Major corporations based in New York such as American International Group Inc. have legally contributed many times more than the corporate limit to political candidates who regulate their businesses, state and good-government officials said Tuesday.
2) In the case of AIG, the insurance giant is limited to giving $5,000 (euro3,951) to a candidate. But the parent company used 33 subsidiaries in recent years to give $335,000 (euro264,738) to three-term Republican Gov. George Pataki; $50,000 (euro39,513) to Attorney General Eliot Spitzer, the Democratic front-runner for governor; and $25,000 (euro19,757) to Democratic Comptroller Alan Hevesi, according to Tuesday's editions of The New York Times.
3) "That happens all the time," said Rachel Leon of New York-Common Cause, which for years has lobbied to reform this and other campaign finance practices.
4) "It's just one of the many loopholes that make our campaign finance laws meaningless," she said Tuesday. "We might as well not have any limits because in the real world, they don't apply."
5) "As far as I can see, it's within the parameters of our law," said Lee Daghlian, a spokesman for the state Board of Elections, of the AIG contributions. "We are not looking at anything."
6) The corporate limits were created in the mid-1970s and set at $5,000 (euro3,951) to restrict the influence of companies on candidates, he said.
7) AIG spokesman Joe Norton did not immediately respond to a request for comment Tuesday. Norton told the Times that the donations by subsidiaries, many of them in sequentially ordered checks drawn from a common account, are charged back to the subsidiaries. He said AIG usually recommends the candidates to receive donations.
8) The contributions in 2003 to Spitzer, the two-term attorney general, were made before Spitzer investigated AIG and its then CEO, Maurice "Hank" Greenberg. AIG, one of the world's largest insurance companies, announced in February that it would pay $1.64 billion (euro1.3 billion) to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies.
9) The settlement did not cover Greenberg, who resigned in March 2005 and is fighting Spitzer in court.
10) Another major concern of Common Cause is companies that are organized as limited liability corporations. The LLCs aren't subject to the $5,000 (euro3,951) corporate limit, but instead are treated as individuals and may contribute as much as $50,100 (euro39,592) to a candidate.
11) "Both loopholes are just another example of how New York campaign finance law is almost completely useless," said Common Cause's Liam Arbetman.


AIG elects former Citigroup president, COO Robert Willumstad as chairman
(APW_ENG_20060920.1170)
1) Robert B. Willumstad, who left Citigroup Inc. after being passed over for the top management job, has been selected as the new chairman of the board of American International Group Inc., one of the world's largest insurance companies.
2) AIG said Wednesday that Willumstad, 61, will succeed Frank G. Zarb, who has been interim chairman since April 2005.
3) Willumstad, who had been president and chief operating officer of Citigroup, announced in July 2005 that he was leaving the nation's largest bank to seek the top job at a public company. He resigned after Charles Prince was named chief executive, replacing the retiring Sanford Weill; Prince later also was given the title of chairman.
4) Zarb had been named to interim chairman after Maurice "Hank" Greenberg was forced to resign in March 2005 amid a widening accounting scandal. Greenberg had led the company for nearly 40 years.
5) In February, AIG agreed to pay $1.64 billion (euro1.29 billion) to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies. The deal also required AIG to adopt changes in its business practices that will ensure proper accounting procedures in the future.
6) The settlement did not cover Greenberg, who is still being pursued by New York Attorney General Eliot Spitzer and federal regulators on accounting issues.
7) AIG said in a statement that Willumstad's appointment would be effective Nov. 1. He was elected to the AIG board in January. AIG said the unanimous decision to name him chairman came at a board meeting in London.
8) Zarb was to remain an AIG director and serve as a nonvoting member of each standing committee of the board, the statement said.
9) In the statement, Zarb called Willumstad "a superb choice" for the job.
10) Martin Sullivan, who was named chief executive and president of AIG after Greenberg's resignation, said in the statement: "I am delighted with the action the board has taken and look forward to working with Bob Willumstad and the board in continuing to strengthen the AIG franchise around the world."
11) As board chairman, Willumstad will be an ex-officio nonvoting member of each standing committee of the board.
12) AIG said that after Willumstad takes his new post, Morris W. Offit will succeed him as chairman of the finance committee and Michael H. Sutton will succeed Offit as chair of the audit committee.


Report: Former AIG Chairman Hank Greenberg is buying shares in New York Times
(APW_ENG_20061129.1838)
1) Shares in the New York Times Co. rose strongly on Wednesday after a published report indicated that Maurice "Hank" Greenberg, the deposed chairman of American International Group Inc., was buying stock in the newspaper publisher.
2) Shares in the Times rose $1.725, or 7.49 percent, to close at $24.76 Wednesday on the New York Stock Exchange.
3) The New York Post, a tabloid competitor of the Times, reported Wednesday that Greenberg has been acquiring "hundreds of thousands" of shares in the newspaper company. The Post is owned by News Corp.
4) In addition to its flagship newspaper, The New York Times Co. also publishes the International Herald Tribune, The Boston Globe and 15 other daily newspapers. It also owns nine network-affiliated television stations and two New York radio stations as well as several Web operations, including About.com.
5) Earlier reports indicated that Greenberg also was considering a bid for Tribune Co., which has a number of newspaper holdings including the Los Angeles Times and the Chicago Tribune.
6) Mark Corallo, a spokesman for Greenberg, said he had no comment on the latest report.
7) Analysts speculated that Greenberg's interest in the New York Times could increase pressure on company management, which has been the target of shareholder Morgan Stanley Investment Management. Morgan Stanley has asked the Times to eliminate its two classes of stock, which concentrate power in the newspaper's founding family, and make changes to its board.
8) Asked about the New York Post report, Times spokeswoman Catherine J. Mathis said the company had no interest in changing the so-called dual-class share structure, which cements control of the company by the Sulzberger family.
9) "The Ochs-Sulzberger family has given no indication of a desire to change the dual-class structure," she said. This was "designed to protect the editorial independence and integrity of The New York Times newspaper ... and, in these challenging times, that is what it is doing."
10) The report came a day after Citigroup analyst William Bird downgraded The Times to "sell" from "hold."
11) He took the action as part of a report suggesting that newspapers will probably continue to see declining operating profits for about five years, until online platforms overcome print-related losses.
12) A number of prominent figures have expressed interest in investing in the beleaguered newspaper industry.
13) Jack Welch, the longtime head of General Electric Co., and other investors reportedly have sought to buy The Boston Globe from the Times.
14) Los Angeles billionaires Eli Broad and Ronald W. Burkle also have an interest in the Los Angeles Times, which is owned by Tribune.
15) Greenberg stepped down as chairman and chief executive of AIG, one of the world's largest insurance companies, in March 2005 after New York Attorney General Eliot Spitzer launched an investigation into the company's accounting procedures. He alleged AIG used "deception and fraud" to make its financial condition appear stronger than it was to investors.


AIG 4th quarter profit climbs sharply from charge-laden year-ago period, but misses analysts ' estimate
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1) American International Group Inc. said fourth-quarter profit rose sharply a year after the world's largest insurer spent $1.64 billion to settle charges of improper accounting practices.
2) Quarterly profit rose more than eight-fold from last year, but missed Wall Street expectations because of a legal settlement and charges to exit a business. Profit for the quarter ended Dec. 30 rose to $3.44 billion (euro2.6 billion), or $1.31 per share, from last year's $444 million, or 17 cents per share.
3) Adjusting for one-time items, profit totaled $3.85 billion (euro2.91 billion), or $1.47 per share. Results missed Wall Street projections by 2 cents per share, according to analysts surveyed by Thomson Financial.
4) It marks the end of a tough year for Chief Executive Martin Sullivan, who replaced Maurice "Hank" Greenberg amid investigations over its record keeping. Not only has Sullivan attempted to overhaul AIG's business, but help it recover from some $1.73 billion of hurricane and asbestos claims it paid out a year earlier.
5) During the fourth quarter, a legal settlement and the insurer's exit of its domestic financial institutions' credit life business decreased profits by $124 million (euro93.76 million), or 5 cents per share. In addition, a charge related to an increase in its asbestos and environmental reserves cut $129 million (euro97.54 million), or 5 cents per share, from its bottom line.
6) "2006 was a remarkable year beginning with the resolution of our significant regulatory challenges and ending with excellent financial results," Sullivan said in a statement Thursday.
7) For the year, AIG reported a profit of $14.05 billion (euro10.62 billion), or $5.36 per share, compared with $10.48 billion, or $3.99 per share. On an adjusted basis, the company reported a profit of $15.41 billion (euro11.65 billion), or $5.88 per share.
8) Separately, AIG unveiled plans to buy $5 billion (euro3.78 billion) in stock in 2007 under a new $8 billion (euro6.05 billion) share repurchase authorization. The New York-based company also plans to raise its dividend 20 percent annually under "ordinary circumstances."
9) The biggest profit surge during the quarter came from AIG's property and casualty business, which reported a 20 percent reduction in claims compared to last year's pay-outs from hurricanes Katrina and Wilma. The business posted an operating profit of $2.51 billion (euro1.9 billion) from $1.16 billion a year earlier.
10) As part of AIG's attempt to restructure the way it accounts for its derivatives contracts, the insurer's financial services business continued to show a loss.
11) "We made significant progress throughout the year in improving our financial control environment, providing greater transparency in our financial disclosures and remaining on the forefront of good corporate governance," Sullivan said.
12) AIG reported operating income from the business slid to a $126 million (euro95.27 million) decline, compared with operating income of $793 million in the year-ago period. Triggering the fall was a $764 million (euro577.69 million) decline in its derivatives portfolio.
13) For the year, the financial services business reported profit fell 88 percent to $524 million (euro396.22 million), from $4.28 billion a year-earlier. The derivatives portfolio's value dropped $1.82 billion (euro1.38 billion) during the year.
14) State and Federal investigators accused AIG of participating in bid-rigging schemes, paying secret commissions to insurance brokers to steer business to it, using phony insurance deals to boost its earnings and misstating the amount of workers' compensation premiums it had collected.
15) Greenberg also was put under investigation for his role at the company.
16) AIG shares rose 30 cents to close at $67.41 on the New York Stock Exchange, and climbed another 1 percent in after-hours trading. The stock rose almost 7 percent during the fourth quarter, and closed 2006 at $71.66.


AIG chief executive earns compensation valued at nearly $22.5 million in 2006
(APW_ENG_20070406.1303)
1) Martin J. Sullivan, who has been running insurance giant American International Group Inc. since the ouster of longtime chief executive Maurice "Hank" Greenberg, received compensation valued at nearly $22.5 million (euro16.82 million) in 2006, according to a regulatory filing Friday.
2) Sullivan, 52, who is president and chief executive of AIG, collected a salary of $1 million (euro750,000), a bonus of $10.1 million (euro7.55 million) and non-equity incentive plan compensation of $5.8 million (euro4.34 million), according to the proxy filed on Good Friday with the Securities and Exchange Commission.
3) His "other" compensation totaled $703,432 (euro526,009) and included some $257,498 (euro192,550) for personal use of corporate aircraft, $135,014 (euro100,960) for a car and driver and $278,250 (euro208,068) for home security. The home security spending was "a result of implementing the recommendations of independent, third-party security studies," the filing said. It did not elaborate.
4) In addition, Sullivan also was awarded restricted shares under the 2006 performance program with an estimated value of $4.88 when they were granted.
5) The Associated Press calculations of total pay include executives' salary, bonus, incentives, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. The calculations don't include changes in the present value of pension benefits and sometimes differ from the totals released by the companies.
6) The proxy was filed in advance of AIG's annual meeting on May 16 in New York City.
7) AIG had a very profitable year in 2006, with net income totaling $14.05 billion (euro10.51 billion), or $5.36 per share, compared with $10.48 billion (euro7.84 billion), or $3.99 per share. Its fourth-quarter profit rose eight fold from the year-earlier period when the insurer spent $1.64 billion (euro1.23 billion) to settle the allegations of improper accounting practices.
8) Sullivan took over as head of the New York-based company in March 2005 after the AIG board removed Greenberg, who had led the company for nearly four decades, amid federal and state probes into accounting irregularities in AIG's property and casualty insurance business. Greenberg later resigned the chairmanship, too.
9) British-born Sullivan had served as AIG's vice chairman and co-chief operating officer before being named chief executive.


Insurer AIG profit climbs 29 percent in 1st quarter, well above Wall Street projection
(APW_ENG_20070510.1742)
1) American International Group Inc., one of the world's largest insurers, said Thursday its profit rose more than 29 percent in the first quarter on strong growth in underwriting results and investment income.
2) That handily beat Wall Street estimates.
3) AIG, which is based in New York, said net income was $4.13 billion (euro3.05 billion), or $1.58 (euro1.17) a share, in the January-March period, up from $3.2 billion (euro2.37 billion), or $1.22 (euro.90) a share, a year earlier.
4) Excluding one-time items, profit was $4.4 billion (euro3.25 billion), or $1.68 (euro1.24) a share, up from $3.4 billion (euro2.51 billion), or $1.29 (euro.95) a share, a year earlier.
5) Revenue was $30.65 billion (euro22.66 billion), up 12 percent from $27.28 billion (euro20.17 billion).
6) Analysts surveyed by Thomson Financial had projected net income of $1.54 (euro1.14) a share on revenue of $29.45 billion (euro21.77 billion).
7) AIG's president and chief executive, Martin J. Sullivan, said in a statement accompanying the results that "AIG had a very good quarter," with strong performance in general insurance businesses worldwide and foreign life insurance. "Asset management results increased compared to the first quarter of 2006," he added.
8) Sullivan said the company continued to seek growth opportunities overseas, saying, "We believe these businesses complement our existing operations ... and offer future growth potential."
9) Operating income from general insurance operations rose to $3.1 billion (euro2.29 billion) in the first quarter from $2.33 billion (euro1.72 billion) a year earlier, with both underwriting profit and net investment income rising.
10) But operating income was down to $2.3 billion (euro1.7 billion) in the first quarter from $2.6 billion (euro1.92 billion) a year earlier in life insurance and retirement services, mainly because of a decline in deposits and increased surrender activity in domestic retirement services, AIG said.
11) Financial services operations turned a profit of $292 million (euro215.86 million), while operating income in asset management operations nearly doubled to $994 million (euro734.83 million).
12) Sullivan was selected by AIG's board in March 2005 to replace longtime Chief Executive Officer Maurice "Hank" Greenberg amid investigations into the company's record keeping.
13) AIG in February 2006 agreed to pay $1.64 billion (euro1.21 billion) to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies.
14) In regular trading Thursday, AIG shares rose 20 cents to $72.20.


American International Group posts 27 percent decline in third-quarter profit
(APW_ENG_20071107.1651)
1) American International Group Inc., the world's largest insurer, said Wednesday its third-quarter profit dropped 27 percent, hurt by tight credit and the ailing U.S. housing market.
2) Shares dropped 3.3 percent, or $1.90 (euro1.29), to $56 (euro38.04) in after-hours trading, when the report was released. They plunged almost 7 percent close at $57.90 (euro39.33) in regular trading Wednesday.
3) AIG's $872.3 billion (euro592.51 billion) -investment portfolio lost $864 million (euro586.88 million), its credit-swap portfolio lost $352 million (euro239.1 million) and its mortgage-insurance business lost $215 million (euro146.04 million).
4) Those declines dampened the insurer's net income, which fell to $3.09 billion (euro2.1 billion), or $1.19 (euro.81) per share, in the July to September period, from $4.22 billion (euro2.87 billion), or $1.61 (euro1.09) per share, in the same period last year.
5) Adjusted to exclude certain items, earnings totaled $3.49 billion (euro2.37 billion), or $1.35 (euro.92) per share, versus $4.02 billion (euro2.73 billion), or $1.53 (euro1.04) per share, last year.
6) Revenue edged up to $29.84 billion (euro20.27 billion) from $29.25 billion (euro19.87 billion).
7) The results fell short of estimates. Analysts surveyed by Thomson Financial projected, on average, profit of $1.62 (euro1.10) per share on revenue of $29.91 billion (euro20.32 billion). The estimates usually exclude one-time items.
8) Back in August, AIG called exposure to subprime debt "minimal," and said Wednesday that despite some losses due to mortgage-backed bonds, its exposure to the debt remains "high quality," with "substantial protection."
9) "While U.S. residential mortgage and credit market conditions adversely affected our results, our active and strong risk management processes helped contain the exposure," said AIG President and Chief Executive Officer Martin J. Sullivan in a statement.
10) AIG's investment portfolio does include collateralized debt obligations, instruments that bundle up different types of debt, and which have been giving banks the bulk of their losses.
11) Investors have been worried about how AIG has been affected by plunging home prices and soaring mortgage defaults, particularly after banks such as Citigroup Inc. and Merrill Lynch & Co. have slashed the value of their mortgage-backed investments by several billions of dollars.
12) Before releasing its results, AIG was the biggest loser Wednesday among the 30 companies that make up the Dow Jones industrial average, and just last week, it briefly touched a two-year low.
13) Maurice "Hank" Greenberg, AIG's former chief executive, said in a regulatory filing Friday he is considering "strategic alternatives" to boost the value of his AIG stake. Investors speculated he might want to bid for the company or parts of the company, or force AIG to spin off one of its businesses.
14) Greenberg was ousted in 2005, when then-New York State Attorney General Eliot Spitzer accused him of fraudulent accounting. The 82-year-old holds a 14 percent stake in AIG through his firm C.V. Starr, and said in last week's filing he plans to hold discussions with other major shareholders.
15) Going forward, AIG could possibly end up booking charges completely separate from the subprime crisis.
16) Police in Brazil cracking down on tax evasion have detained 19 people allegedly tied to a money-laundering scheme that involves AIG and two Swiss banks. The scheme allegedly helped large Brazilian companies evade taxes by laundering money through AIG, the Swiss banks, and black market money changers.


Trial opens for 5 ex-insurance US executives charged with manipulating financial statements
(APW_ENG_20080107.0955)
1) The former chairman and CEO of the world's largest insurer initiated a deal that led to five ex-executives being charged with participating in a scheme to manipulate the company's financial statements, a federal prosecutor said Monday during opening arguments at their trial.
2) Four former executives of Berkshire Hathaway's General Re Corp. and a former executive of American International Group Inc. are charged in the scheme involving AIG's financial statements.
3) Prosecutor Raymond Patricco said former AIG CEO Maurice "Hank" Greenberg, who has not been charged in the case, started the scheme in 2000, after AIG's stock price dropped 6 percent, representing a loss of $12 billion to shareholders. The price dropped because loss reserves had declined.
4) "Greenberg and AIG came to Gen Re for this deal," Patricco said.
5) Greenberg, who headed the New York-based company for nearly 40 years, has denied any wrongdoing. He was referred to as an unindicted coconspirator in an indictment.
6) Allegations of accounting irregularities, including the Gen Re transactions, led to his resignation in 2005.
7) At issue in the trial of the former executives are two reinsurance transactions between AIG and Stamford-based General Re. Reinsurance policies are backups purchased by insurance companies to completely or partly insure the risk they have assumed for their customers.
8) Prosecutors said the transactions were initiated by an AIG senior executive to quell criticism by analysts of a reduction in AIG's loss reserves in the third quarter of 2000. The indictment alleges that the aim was to make it appear that AIG increased its loss reserves by about $500 million in 2000 and 2001, pacifying the analysts and investors and artificially boosting the company's stock price.
9) "But the evidence in this case will show that deal was nothing more than a sham transaction," Patricco said. "The defendants in this case knew what appeared in the contracts was a lie."
10) Prosecutors said Greenberg called his friend, former General Re CEO Ronald Ferguson, who is one of the defendants, and told him that AIG wanted to increase its loss reserves by $500 million, but did not want to bear the risk.
11) Ferguson agreed to the deal Greenberg proposed, Patricco said.
12) For a reinsurance transaction to be legitimate, there must be a transfer of risk, which was lacking in the deal in question, prosecutors said.
13) "The evidence in this case will show the defendants knew this would be a no-risk deal for AIG," Patricco said.
14) Greenberg and the company later reported in earnings reports that the loss reserves had gone up.
15) "Plain and simple, ladies and gentlemen, the statements about AIG's loss reserves were lies," Patricco said.
16) In opening arguments, Patricco never mentioned billionaire investor Warren Buffett, who could play a role in the trial. Some of the executives say they believed Buffett was involved and supported the deal that led to the charges. Buffett leads Berkshire Hathaway.
17) But prosecutors say they only named Buffett, who has not been charged with any wrongdoing, as a potential witness to rebut any suggestion by the defense that he was involved in or approved the deal.
18) The former General Re executives charged were Ferguson, chief executive officer from about 1987 through September 2001; Elizabeth Monrad, chief financial officer from June 2000 through July 2003; Robert Graham, a senior vice president and assistant general counsel from about 1986 through October 2005; and Christopher P. Garand, a senior vice president from 1994 until 2005.
19) Also charged was Christian Milton, AIG's vice president of reinsurance from about April 1982 until March 2005. Patricco said Monday that he lost $360,000 when the stock price dropped.
20) The defendants have pleaded not guilty to the charges.
21) AIG filed a restatement in 2005 related to the transactions and agreed to pay a record $1.64 billion in a settlement with federal and New York authorities.
22) In 2005, two senior Gen Re executives, John Houldsworth and Richard Napier, pleaded guilty to conspiracy to falsify SEC filings in connection with the investigation and are awaiting sentencing.
23) If convicted of all the charges, Ferguson, Monrad, Milton and Graham each face up to 230 years in prison and a fine of up to $46 million. Garand faces up to 160 years in prison and a fine of up to $29.5 million.
24) The trial is expected to last about two months.


Prosecutors in Gen Re-AIG trial say execs knew financial statements were being manipulated
(APW_ENG_20080211.1389)
1) A federal prosecutor urged a jury Monday to follow the money and convict five former insurance company executives of a scheme to manipulate the financial statements of the world's largest insurer.
2) "The defendants knew the true deal and they documented a false one," prosecutor Eric Glover said in his closing argument.
3) But an attorney for one of the defendants repeatedly invoked the name of widely admired billionaire investor Warren Buffett in arguing there was no wrongdoing and only a routine deal between Berkshire Hathaway Inc.'s General Re Corp. and American International Group Inc. Buffett heads Berkshire Hathaway.
4) "You don't encourage your boss to talk to Warren Buffett about a deal if you're a criminal," said Reid Weingarten, attorney for Elizabeth Monrad, one of the defendants.
5) Prosecutors had said they might seek testimony from Buffett, but they did not. Some of the defendants said they believed he was involved in the deal that lead to the charges, but prosecutors and Buffett say that wasn't the case. Buffett has not been charged with any wrongdoing.
6) Jury deliberations were expected to begin Wednesday after closing arguments are completed.
7) The arguments in U.S. District Court in Hartford capped a monthlong trial for four former executives of General Re and a former AIG executive. The defendants are accused of inflating AIG's reserves through reinsurance deals by $500 million in 2000 and 2001 to artificially boost its stock price.
8) Reinsurance policies are backups purchased by insurance companies to completely or partly insure the risk they have assumed for their customers.
9) Authorities say the premiums supposedly due AIG were an illusion. In a roundtrip of cash, AIG gave Gen Re the $10 million to pay the premiums as part of a secret side agreement, prosecutors said.
10) Glover said that arrangement was like asking an insurer to pay a driver to insure a car.
11) "Remember, no one pays you to reinsure your car," Glover said.
12) Glover confirmed during his closing argument that former AIG Chief Executive Maurice "Hank" Greenberg was an unindicted coconspirator in the case. Greenberg has not been charged and has denied any wrongdoing, but allegations of accounting irregularities, including the General Re transactions, led to his resignation in 2005.
13) Glover said Greenberg trumpeted the increased loss reserves.
14) "Another quote by Mr. Greenberg, another lie to analysts and shareholders," he said.
15) Prosecutors also played tapes of phone calls and cited e-mails to bolster their case.
16) Glover played one tape in which Monrad, Gen Re's chief financial officer from June 2000 through July 2003, asked if the deal would show up in any public documents.
17) Weingarten, who started off closing arguments for the defendants, said prosecutors played snippets of calls out of context. Monrad was concerned that attention over the deal might make it look like her company was too close to AIG or couldn't handle its own liabilities, Weingarten said.
18) He said his client wanted more accountants and attorneys involved and was not responsible for how AIG booked the deals.
19) Weingarten attacked two government witnesses, saying one was like a virus and that the other was desperate to stay out of jail.
20) Weingarten said it did not make sense that Greenberg, at the end of his career, would be willing to commit a felony because reserves dropped by a fraction of a percent.
21) In addition to Monrad, the defendants are former General Re CEO Ronald Ferguson; former General Re Senior Vice President Christopher P. Garand; and Robert Graham, a General Re senior vice president and assistant general counsel from about 1986 through October 2005.
22) Also charged is Christian Milton, AIG's vice president of reinsurance from about April 1982 until March 2005.
23) If convicted of all the charges, Ferguson, Monrad, Milton and Graham each face up to 230 years in prison and a fine of up to $46 million (euro31.63 million). Garand faces up to 160 years in prison and a fine of up to $29.5 million (euro20.29 million).


Former AIG chief Maurice Greenberg urges insurer to delay annual meeting, says it is in crisis
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1) Maurice R. Greenberg, the former chief executive and largest individual shareholder of AIG, is urging the insurer to postpone its annual meeting in the wake of its massive first-quarter loss, according to regulatory filing Monday.
2) American International Group Inc., the world's largest insurance company, said Friday it lost $7.81 billion (euro5.06 billion), or $3.09 (euro2) per share, in the first quarter. AIG also announced plans to raise $12.5 billion (euro8.1 billion) in the coming months to shore up its capital base.
3) In a letter to the board dated Sunday, Greenberg said he and other top shareholders are deeply concerned "about the persistent and seemingly endless destruction of value at AIG." He said the company's leadership has also lost credibility with the investment community.
4) "AIG is in crisis," Greenberg wrote.
5) "The company's problems are more than financial and extend far beyond its subprime credit exposure or approach to capital management," he said in the letter. "Core businesses are also deteriorating."
6) Greenberg said New York-based AIG has not explained why it chose to raise $12.5 billion (euro8.1 billion) in the capital markets rather than pursuing other options, such as divesting noncore assets or seeking other sources of funding.
7) "Shareholders deserve to know how this decision was reached and what other alternatives were considered and evaluated," Greenberg wrote. He also questioned AIG's decision to increase its dividend by 10 percent, to 22 cents per share.
8) AIG spokesman Chris Winans said the board received the letter Monday morning but sees no need to postpone the annual meeting, which is scheduled for Wednesday.
9) AIG shares dropped $1.91, or 4.7 percent, Monday to close at $38.37, their lowest point since October 1998, following a downgrade from Goldman Sachs. Shares slipped another 12 cents in after-hours electronic trading.
10) Greenberg was forced out of the company in 2005, when then-New York State Attorney General Eliot Spitzer accused him of fraudulent accounting.


Reports: AIG board of directors meeting to consider possible resignation of CEO
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1) The board of directors of insurer American International Group Inc., which has lost billions on bad bets on the mortgage market, was meeting Sunday to consider the future of CEO Martin Sullivan, according to published reports.
2) Citing an unnamed source, The Wall Street Journal said the resignation of Sullivan was not a certainty but "highly likely." It said the board would discuss who would take Sullivan's place.
3) The Financial Times reported that it was unclear whether Sullivan had offered his resignation or if the board would call for it at the meeting.
4) The phone for an AIG spokesman rang unanswered on Sunday.
5) New York-based AIG lost $7.8 billion during the first quarter of the year due to investments and contracts tied to bad loans. The insurer's first-quarter deficit was even more massive than its fourth-quarter loss of more than $5 billion. After its two straight quarterly losses, AIG revealed plans to raise $20 billion in fresh capital -- but investors reacted skeptically, unsure that extra cash would solve the insurer's problems.
6) Shares of AIG have fallen by more than 50 percent over the past 12 months, closing at $34.18 on Friday.
7) In addition to big losses, AIG is reportedly facing a regulatory probe. The Securities and Exchange Commission reportedly began looking into whether AIG had overstated the value of contracts called credit default swaps.
8) Credit default swaps, or CDS, are essentially insurance policies that investors buy to protect against loan defaults, including subprime mortgage defaults. A surprisingly large $9.1 billion loss in AIG's CDS portfolio dealt the insurer its most significant blow during the first quarter.
9) Many angry shareholders blame poor management for AIG's financial troubles.
10) Last August, shortly after mortgage-related losses began roiling the financial services industry, Sullivan told investors that AIG was "well-positioned, even in the event of further deterioration in this market." But by May, Sullivan acknowledged that "the severity of the unrealized valuation losses and decline in value of our investments were beyond our expectations."
11) Sullivan -- who received compensation last year of $13.9 million -- replaced Maurice R. "Hank" Greenberg as chief executive in March 2005. Greenberg, forced out amid accusations from then-New York State Attorney General Eliot Spitzer of fraudulent accounting, still controls the largest block of stock in AIG.


AIG loses more than $5B on credit market troubles
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1) American International Group Inc. said Wednesday that it lost more than $5 billion in the second quarter, as struggling credit markets stripped several billions of dollars in value from its credit default swaps portfolio and other investments.
2) The world's largest insurer lost $5.36 billion in the April-to-June period, or $2.06 per share. In the same period last year the company earned $4.28 billion, or $1.64 per share.
3) After excluding one-time items, the loss per share came to 51 cents -- much worse than the 63-cent gain that analysts were anticipating.
4) Shares of AIG fell more than 7 percent in after-hours trading, having fallen 80 cents, or 2.7 percent, to close Wednesday at $29.09.
5) AIG's third straight quarterly deficit occurred after it took a loss of $5.56 billion, or $3.62 billion after taxes, in what are called credit default swaps, and a write-down of $6.08 billion, or $4.02 billion after taxes, in the value of other investments.
6) Credit default swaps, which slammed AIG in previous quarters as well, are essentially insurance policies to protect bondholders against defaults. Over the past three quarters, AIG has lost more than $25 billion, pre-tax, to credit default swaps, and more than $15 billion, pre-tax, in other investments.
7) Financial institutions that bet heavily on risky mortgage-backed securities have been pummeled since the start of the credit crisis. When the mortgages underlying these securities began failing, the value of the investments plunged, forcing companies including AIG to heavily mark down the value of their holdings.
8) Investors' abandonment of the credit markets last year brought the value of debt securities down even further, and the continuing wave of foreclosures this year has extended the losses at financial companies.
9) Further dampening its second-quarter results, AIG's general insurance segment saw a 54.3 percent decline in operating income to $1.39 billion, and its life insurance and retirement services division saw a 10 percent decline in operating income to $2.61 billion. The company's asset management unit also suffered a decline in income.
10) Back in May, having posted two consecutive quarterly losses, AIG decided to raise capital in an effort to improve its financial standing. AIG said Wednesday that it raised approximately $20 billion in capital through the sale of $7.47 billion of common stock, $5.88 billion in equity units and $6.91 billion in certain fixed-income securities.
11) Then in June, the insurer replaced its then-CEO Martin Sullivan with Citigroup Inc. veteran Robert Willumstad.
12) Willumstad said at the time that he would review AIG's businesses, and that there were "no sacred cows." The CEO reiterated those thoughts Wednesday, and said the insurer will report on its progress in late September.
13) "Our second quarter results were adversely affected by the severe conditions in the housing and credit markets and a very difficult investment environment," Willumstad said in a statement. "These results do not reflect the earnings power and potential of AIG's businesses and it is clear that we have a lot of work to do to restore AIG's profitability to where it should be."
14) AIG executives will hold a conference call to discuss the company's results with investors on Thursday at 8:30 a.m. Eastern time.
15) The second quarter has been a difficult one for not only AIG, but the entire insurance industry. The sector struggled through tight financial markets, as well as storms that ravaged the Midwest and South.
16) Still, insurers generally have not been hit as badly as investment and commercial banks by the credit crisis.
17) Merrill Lynch & Co. and Citigroup Inc. have each reported write-downs totaling about $46 billion since the credit crisis began a year ago; globally, financial companies have written down some $300 billion in failed credit investments.


AIG plans major restructuring, according to report
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1) The Wall Street Journal reported Sunday that American International Group Inc. plans to disclose a restructuring by early Monday that's likely to include the disposal of major assets including its aircraft-leasing business and other holdings.
2) The Journal said on its Web site that the world's largest insurer was also talking to several private equity firms about getting more capital and was hoping to raise more than $10 billion.
3) A spokesman for AIG did not immediately return calls seeking comment.
4) The New York-based insurer has already raised $20 billion in fresh capital this year.
5) Like other insurers, AIG has been hit hard by deterioration in the credit markets amid concerns that complex, structured investments it insures will increasingly default. Over the past three quarters, AIG has lost about $25 billion in the value of credit default swaps -- or default protection for bondholders -- and about $15 billion on other investments.
6) The insurer is considering selling or spinning off its aircraft-leasing arm, International Lease Finance Corp. AIG was considering selling other parts of its business, including assets related to property and casualty insurance, the Journal noted.
7) The moves follow a rapid plunge last week in the company's shares -- the stock fell more than 30 percent on Friday alone -- amid concern that its capital base isn't sufficient.
8) Late Friday, Standard & Poor's warned that it could cut AIG's credit rating by one to three notches because of concerns that AIG will have difficulty accessing capital in the short term.


AIG shares fluctuate as it tries to shore up books
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1) Shares of American International Group Inc. fluctuated Tuesday as investors questioned whether the insurer would come up with more money and avoid igniting even more global financial turmoil.
2) A CNBC report saying the Federal Reserve was considering providing financing to AIG brought shares off their intraday lows, although they later retreated again.
3) AIG shares were down $2.20, or 46 percent, to $2.56 in late morning trading, rebounding from an intraday low of $1.25 but below the day's high of $4.57. Shares have traded as high as $70.13 during the past year.
4) Late Monday night, all three major agencies -- Standard & Poor's, Moody's Investors Services and Fitch Ratings -- cut AIG's ratings at least two notches. While the new ratings are all still considered investment grade, the downgrades add to the pressure on AIG as it seeks tens of billions of dollars to strengthen its balance sheet.
5) "Getting some kind of liquidity facility in the next couple of days will help confidence," Rodney Clark, a credit analyst at S&P, said in an interview.
6) AIG spokesmen did not return calls seeking comment on the impact of the downgrades. But last month, the company estimated in a regulatory filing that a one-notch downgrade of its long-term senior debt ratings by both S&P and Moody's would force it to post $13.3 billion in extra collateral.
7) The need for that extra capital would put a constraint on AIG's day-to-day liquidity position, which is why the company has been seeking new financing or capital investments.
8) "While there is a chance the company can work its way through its liquidity problems if it can secure substantial bridge financing, we think this will be challenging to execute it in the current onerous credit environment," Credit Suisse analyst Thomas Gallagher wrote in a research note to clients.
9) AIG is in a precarious position, in part, because of concerns about its credit ratings and how that would affect its portfolio of financial instruments known as credit default swaps. The swaps are essentially insurance coverage to protect investors against defaulting bonds or debt.
10) For the three quarters ended in June, AIG lost about $25 billion in the value of credit default swaps.
11) In its efforts to improve its liquidity, AIG has already received support from the New York governor and state's insurance regulator. On Monday, Gov. David Paterson and state regulators approved a measure that allows AIG to use $20 billion of assets held by its subsidiaries to provide cash needed to stay in business.
12) Paterson asked New York state insurance regulators to essentially allow New York-based AIG to provide a bridge loan to itself. The governor has also asked the head of New York's insurance department to talk with federal regulators about providing an additional bridge loan to AIG.
13) "AIG still remains financially sound," Paterson said.
14) That $20 billion in support though is unlikely to be nearly enough to help AIG.
15) S&P's Clark said the financing facility agreed upon with New York regulators is a "helpful starting point," but AIG will "definitely need added capital and liquidity."
16) The Fed on Monday asked Goldman Sachs Group Inc. to work with JPMorgan Chase & Co. about a possible short-term loan to keep AIG in business, said a person familiar with the request who could not speak publicly because talks were still ongoing. The loan could be for about $70 billion, the person said.
17) Tuesday morning, while announcing fiscal third-quarter earnings, Goldman Sachs Chief Financial Officer David Viniar said during a conference call that he was "not going to comment on rumors about where we are in helping AIG." He said they are "good important clients" but refused to discuss the matter further.


AP Source: Gov ' t bailout of AIG seen more likely
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1) A person with knowledge of the situation says the government is increasingly likely to step in to help rescue the huge insurer AIG.
2) AIG's failure could open the ugliest chapter yet of the financial meltdown.
3) The person, who asked not to be named because of the sensitive nature of the talks to help AIG, said Tuesday: "The glimmer of hope has turned into a ray of hope" for AIG.
4) Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke met with members of Congress to brief them on options the government is considering. The meeting ended without Bernanke and Paulson commenting.


Government announces $85 billion loan to save AIG
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1) The U.S. government has agreed to provide an $85 billion emergency loan to rescue the huge insurer AIG, the Federal Reserve said Tuesday.
2) The Fed said the U.S. Treasury Department was in full support of the decision.
3) The Fed determined that a "disorderly failure" of AIG could undermine already fragile financial markets.
4) The government will receive an 79.9 percent equity stake in AIG, the Fed said.


Government announces $85 billion loan to save AIG
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1) In a bid to save financial markets and the economy from further turmoil, the U.S. government agreed Tuesday to provide an $85 billion emergency loan to rescue the huge insurer AIG.
2) The Federal Reserve said in a statement it determined that a disorderly failure of AIG could hurt the already delicate financial markets and the economy.
3) It also could "lead to substantially higher borrowing costs, reduced household wealth and materially weaker economic performance," the Fed said.
4) "The President supports the agreement announced this evening by the Federal Reserve," said White House spokesman Tony Fratto. "These steps are taken in the interest of promoting stability in financial markets and limiting damage to the broader economy."
5) Treasury Secretary Henry Paulson said the administration was working closely with the Fed, the Securities and Exchange Commission and other government regulators to "enhance the stability and orderliness of our financial markets and minimize the disruption to our economy."
6) "I support the steps taken by the Federal Reserve tonight to assist AIG in continuing to meet its obligations, mitigate broader disruptions and at the same time protect taxpayers," Paulson said in a statement.
7) The Fed said in return for the loan, the government will receive a 79.9 percent equity stake in AIG.
8) Earlier, Fed chairman Bernanke and Paulson met with Senate Banking Committe Chairman Sen. Christopher Dodd, Senate Majority Leader Harry Reid, and House Republican leader John Boehner to brief them on the government's options.
9) "At the administration's request, I met this evening with Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke. They expressed the administration's views on the deepening economic turmoil and shared with us their latest proposals regarding AIG," Reid told reporters. "The Treasury and the Fed have promised to provide more details in the near future, which I believe must address the broader, underlying structural issues in the financial markets."
10) On Tuesday, shares of the insurance company swung violently as rumors of potential deals involving the government or private parties emerged and were dashed. By late Tuesday, its shares had closed down 20 percent -- and another 45 percent after hours. Still, no deal emerged.
11) The problems at AIG stemmed from its insurance of mortgage-backed securities and other risky debt against default. If AIG could not make good on its promise to pay back soured debt, investors feared the consequences would pose a greater threat to the U.S. financial system than this week's collapse of the investment bank Lehman Brothers.
12) The worries were triggered after Moody's Investor Service and Standard and Poor's lowered AIG's credit ratings, forcing AIG to seek more money for collateral against its insurance contracts. Without that money, AIG would have defaulted on its obligations and the buyers of its insurance -- such as banks and other financial companies -- would have found themselves without protection against losses on the debt they hold.
13) "It might not just bring down other financial institutions in the U.S. It could bring down overseas financial institutions," said Timothy Canova, a professor of international economic law at Chapman University School of Law. "If Lehman Brother's failure could help trigger AIG's going down, who knows who AIG's failure could trigger next."
14) New York-based AIG operates insurance and financial services businesses ranging from property, casualty, auto and life insurance to annuity and investment services. Those traditional insurance operations are considered healthy and the National Association of Insurance Commissioners said "they are solvent and have the capability to pay claims."


US stocks tumble as critical insurer teeters
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1) Stocks plunged Wednesday as investors remained worried about chaos in the U.S. financial market even after the Federal Reserve forged an extraordinary $85 billion rescue of insurance giant American International Group Inc.
2) The Federal Reserve's emergency loan to shore up AIG, the world's largest insurer, temporarily lifted some uncertainty about the stability of the U.S. financial system, but the market plummeted as investors kept a wary eye on the company, which is reeling from billions of dollars in souring mortgage debt.
3) The two Wall Street investment banks left standing after a week of stunning upheavals -- Goldman Sachs Group Inc. and Morgan Stanley -- also remain under scrutiny. And the troubles in banking could exacerbate economic problems. The Commerce Department said Wednesday that housing starts fell by 6.2 percent in August to the slowest building pace since January 1991.
4) The Dow Jones industrial average dropped more than 340 points Wednesday. A 500-point drop on Monday marked the largest in the Dow Jones industrials since the Sept. 11, 2001, terrorist attacks, as the venerable Wall Street giant Lehman Brothers filed for the biggest bankruptcy in U.S. history.
5) Investors fear that a failure of AIG, the world's largest insurer, would set off even more financial turmoil than the collapse of Lehman.
6) "We dodged a bullet, but we want to make sure it's a complete cease-fire," said Jack A. Ablin, chief investment officer at Harris Private Bank, noting that AIG still needs to unwind its investment positions, sell off assets, and possibly get more cash.
7) The government was taking other measure to help alleviate the turmoil. The Treasury said it will start selling bonds for the Fed in an unprecedented effort to aid it with its lending efforts, while the Securities and Exchange Commission said it will strictly prohibit naked short-selling starting Thursday.
8) Short-selling is when traders borrow shares of a stock they expect to fall and sell them -- if the stock does indeed fall, the traders buy the cheaper shares to cover the borrowed ones and profit from the difference. Naked short-selling occurs when sellers don't actually borrow the shares before selling them; it's a practice some say is partially responsible for the huge drop in the shares of investment banks like Lehman, Merrill Lynch and Bear Stearns Cos., which JPMorgan Chase & Co. bought earlier this year.
9) The Fed said Tuesday night that it was acting to shore up AIG after determining that a disorderly failure of the company, whose financial dealings stretch around the world, could hurt the already delicate markets and the economy.
10) Asian stock markets partly recovered Wednesday after the U.S. government announced the bailout plan for AIG, but later dipped as the news failed to persuade many investors that the financial turmoil would ease soon. European stocks rose after two days of declines.
11) AIG, a company little known off Wall Street, does business with almost every financial institution in the world and insures $88 billion worth of assets including mortgages and corporate loans.
12) Under the plan orchestrated by the Fed during a day of crisis talks, the U.S. government will provide an emergency $85 billion loan at an interest rate of about 11.5 percent to AIG, and in return receive a 79.9 percent equity stake in the company, similar to the way the government took control of faltering mortgage giants Fannie Mae and Freddie Mac.
13) The Fed said in a statement that an AIG failure could "lead to substantially higher borrowing costs, reduced household wealth and materially weaker economic performance."
14) The pressure already had grown when all three major credit rating agencies cut AIG's ratings at least two notches late Monday night. New York Gov. David Paterson had agreed to allow AIG to use $20 billion of assets held by its subsidiaries to pay for its business -- essentially giving it a bridge loan from itself -- but indicated that the company had only 24 hours to find the cash needed to stay in business.
15) A collapse of AIG would force Wall Street to untangle the complex credit derivatives markets and send the market scrambling to figure out who owes what to whom -- or even who owns what.
16) The Fed stepped in hours after it decided, in its first unanimous vote this year, to keep the closely watched federal funds rate unchanged at 2 percent. At the same time, however, the Fed noted that strains on the market have "increased significantly" and said it was ready to act if needed.
17) As AIG teetered, central bankers around the globe scrambled to revive credit markets. The Fed injected $70 billion into the American financial system. The European Central Bank pumped one-day financing of nearly $100 billion into the 15-nation zone. The Bank of Japan added $24 billion, and Britain's central bank almost $36 billion.
18) Cash left world markets Monday like an outgoing tide. The interest rate banks charge each other for overnight loans soared as high as 6 percent -- far above the Fed's target rate of 2 percent and a sign banks did not trust each other enough to make even 12-hour loans.
19) Meanwhile, British bank Barclays PLC said Tuesday it had agreed to acquire Lehman's North American investment banking and capital markets businesses for $250 million in cash, just two days after walking away from a deal to purchase all of Lehman's.
20) The British bank will also purchase Lehman's New York headquarters and its two data centers in New Jersey for $1.5 billion. The deals require approval from the bankruptcy court.
21) Meanwhile, Lehman executives continue to negotiate a potential sale of its prized investment management division, which includes money manager Neuberger Berman. The division was once valued by as much as $10 billion by Wall Street analysts, but now could fetch much less considering Lehman's bankruptcy proceedings.
22) A person familiar with the negotiations, who spoke on condition of anonymity because the talks are ongoing, said Lehman was focusing on trying to sell the business to private-equity firms. The sale is expected to happen in a matter of days, the person said.
23) Separately, Bank of America Corp., which in July bought battered Countrywide Financial Corp., began to work out how it would digest its $40 billion acquisition of Merrill Lynch after its shotgun wedding with the brokerage on Sunday.
24) In the wings, Goldman Sachs Group Inc., which began the year as one of five large investment banks and is now one of two, reported its worst profit drop since going public in 1999. Goldman's third-quarter profit dropped 71 percent to $810 million, while revenues plummeted 50 percent.
25) The only other major U.S. investment bank left standing, Morgan Stanley, had better news. It reported solid quarterly profits -- though down 7 percent from a year earlier -- and surpassed Wall Street's expectations.
26) Earlier this year, the federal government engineered the sale of Bear Stearns to JPMorgan Chase.
27) On the campaign trail, Republican presidential nominee John McCain told ABC's "Good Morning America" on Wednesday that he had not wanted the AIG bailout, but said millions of people whose finances were tied up in the company were in danger of having their lives destroyed.
28) He blamed greed, excess and corruption for AIG's problems. He also said that Congress and federal regulators had paid no attention to the problem.


Will AIG plan cost taxpayers money, or just sleep?
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1) American taxpayers awoke Wednesday to learn they may end up owning one of the world's largest insurers. They might now lose some sleep wondering whether the government's $85 billion loan to American International Group Inc. was a wise investment.
2) If the gamble succeeds, the company nurses itself back to health, unhinged financial markets calm down and taxpayers turn a profit.
3) If it fails, the American public feels the hit -- and possibly finds itself rescuing other major financial institutions, swelling the deficit and potentially driving up interest rates on mortgages, student loans and other debt.
4) Analysts said Wednesday the odds are pretty high that the rescue will be a good investment for taxpayers, with AIG paying off the loan at a relatively high interest rate and the government potentially making money off its nearly 80 percent equity stake in the company.
5) In 1979, the U.S. guaranteed $1.2 billion worth of loans to the struggling automaker Chrysler. When the company rebounded four years later, the government reaped more than $300 million in profits.
6) While relatively unknown outside of financial circles before Wednesday, AIG is a colossus on Wall Street and financial districts around the globe, with operations in more than 130 countries and $1 trillion in assets on its balance sheet.
7) Besides life, property and other insurance offerings, AIG provides asset-management services and airplane leases. Its myriad businesses are also linked to mutual funds, annuities and other retirement products held by millions of ordinary Americans.
8) But perhaps the biggest concern about AIG is the dizzying array of complex financial instruments it structured for commercial banks, investment banks and hedge funds around the globe -- many of which were directly or indirectly linked to the value of U.S. mortgages.
9) "AIG is in this mess because they got leveraged up to their eye balls," said Professor John Coffee of Columbia University Law School.
10) AIG is required to post capital as collateral to back the securities and derivatives it issues, and those requirements increase if its credit rating is downgraded, as happened on Monday night.
11) AIG "essentially became the insurer of the financial industry," said Barry Ritholtz, chief executive of FusionIQ, a research firm. "As we've seen, that turned out to be not such a great trade."
12) The company's staggering reach, combined with the speed with which it faltered, is what forced the government to intervene after private rescue attempts fell apart and pushed the company to the edge of bankruptcy.
13) "A failure was seen as having catastrophic implications. It met the threshold of too big and too intertwined to fail," said former Federal Reserve economist Brian Sack now at Macroeconomic Advisers.
14) Over the weekend, the government refused to pony up taxpayer money to rescue troubled investment bank Lehman Brothers. That was seen as drawing a line in the sand after the Fed financially backed JPMorgan's takeover of Bear Stearns and then the Bush administration seized control of mortgage finance companies Fannie Mae and Freddie Mac.
15) But that turned out to be wrong.
16) The government agreed to loan up to $85 billion to AIG over two years in exchange for the right to buy 79.9 percent of the company. The hope is that the money will give the company enough time to reorganize and sell assets to repay the loan.
17) The interest rate the government is charging AIG for the loan is high -- 11.5 percent. Because the government can borrow money right now at around 3.4 percent, taxpayers stand to make a handsome profit if all goes well.
18) The government is first in line to be paid back on the loan, which is backed by the assets of the entire company.
19) Key to the U.S. being repaid for its loan is whether AIG can sell its assets, how quickly and for what price.
20) For the company, that might mean putting some of its profitable, noncore assets, such as its aircraft leasing business, on the block. AIG's breakup value could top $150 billion, according to a preliminary estimate from FBR Capital Markets.
21) "The odds are pretty high that it will end up being a good investment for taxpayers," said Mark Klock, finance professor at George Washington University. "I think that AIG will be able to dispose of assets in an orderly fashion in the next year or so and the government will actually get back the money lent out -- and more -- in interest," he said.
22) It will be up to AIG to decide which assets to sell and the timing, which some analysts said should be done quickly because the publicized difficulties at the company could begin to turn customers away. The government does, however, have veto power.
23) One unit that analysts said will likely be sold is the International Lease Finance Corp., which leases out more than 900 aircraft with asset values topping $44 billion at the end of the second quarter. This division has been a moneymaker for AIG, tallying $873 million in operating income in 2007 and $555 million in the first half of this year, according to securities filings.
24) Another possibility for sale is AIG's foreign life insurance business, with profits of $1.5 billion in the first half of this year on top of earnings of $6.19 billion in 2007. Gary Ransom, an analyst with Fox-Pitt Kelton, pegged the value of that business at as much as $50 billion.
25) But Ransom also noted the foreign life insurance business is also probably the hardest to sell because it includes many different divisions operating across many countries.
26) "I would say everything is on the table," Ransom said. "At this point, the goal isn't to keep AIG as the owner of businesses."
27) If AIG is keeping some operations, the commercial lines and property and casualty operations are possibilities because they are among the divisions that are most closely associated with the company.
28) "They would love to sell off the bad stuff, but the only option they have is to sell off the good stuff," said Kent Smetters, an associate professor insurance and risk management at the Wharton School of Business.


AIG signs deal for $85 billion from Fed
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1) American International Group Inc. said on Tuesday it had completed the deal under which it is getting an $85 billion injection of taxpayer money, while the government gets an 80 percent stake in one of the world's largest insurers.
2) New York-based AIG said it signed a definitive agreement with the Federal Reserve Bank of New York for the deal that was hammered out last week.
3) The agreement provides a two-year $85 billion emergency loan at an interest rate of about 11.5 percent to AIG, which teetered on the edge of failure because of stresses caused by the collapse of the subprime mortgage market and the credit crunch that ensued.
4) In return, the government will get a 79.9 percent stake in AIG.
5) AIG said it will repay the money in full with proceeds from the sales of some of its assets. It will be up to the company to decide which assets to sell and the timing. The government does, however, have veto power.
6) Shortly after AIG struck the deal, it announced former Allstate Corp. Chief Executive Officer Edward Liddy was taking over as chairman and chief executive. Liddy replaced Robert Willumstad, who took over the company in June.
7) "AIG made an exhaustive effort to address its liquidity needs through private sector financing, but was unable to do so in the current environment," Liddy said in a statement Tuesday. "This facility was the company's best alternative. We are pleased to have finalized the terms of the facility, and are already developing a plan to sell assets, repay the facility and emerge as a smaller but profitable company."
8) He said AIG's insurance subsidiaries remain "strong, liquid and well-capitalized."


Former AIG CEO Greenberg says plans to sell stock
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1) Former American International Group Inc. chief executive Maurice "Hank" Greenberg intends to sell his AIG stock, according to a regulatory filing on Thursday.
2) Greenberg, who ran AIG for nearly four decades, said he plans to sell shares of the New York-based insurer for "liquidity and other purposes," according to a filing with the Securities and Exchange Commission.
3) Late Tuesday, AIG said it signed a definitive agreement with the Federal Reserve Bank of New York for a two-year, $85 billion emergency loan at an interest rate of about 11.5 percent. AIG had teetered on the edge of failure because of stresses caused by the collapse of the subprime mortgage market and the credit crunch that ensued.
4) Greenberg will sell the stock in the open market, and the sales may "materially" decrease the holdings that he controls, according to the filing.
5) Greenberg, through a personal stake, family trust and companies that he controls, owns more than 10 percent of AIG, making him its largest shareholder before the company agreed to a federal bailout that will give the government 80 percent ownership.
6) His personal stake, according to Thomson Reuters, is about 36.9 million shares.
7) AIG shares tumbled 29 cents, or 8.8 percent, to $3.02 in trading Thursday, valuing Greenberg's personal stake at roughly $111.4 million.
8) AIG traded as high as $70.13 last October, as the credit crisis was unfolding. Assuming he held approximately the same size stake at that time, his holdings would have lost about $2.4 billion in value over that period.
9) Also Thursday, prosecutors attempted to convince a federal judge to consider investor losses as great as $1.4 billion when sentencing five insurance executives convicted of a scheme to manipulate AIG's financial statements. Four former executives of General Re Corp. and a former executive of AIG were convicted in February of conspiracy, securities fraud, mail fraud and making false statements to the Securities and Exchange Commission.


AIG ' s Japan unit gets capital for stock price fall
(APW_ENG_20080930.0358)
1) A Japanese insurer that is a unit of troubled American International Group Inc. has received 90.7 billion yen (US$872 million) in additional funds to bolster its financial strength, the company said Tuesday.
2) Alico Japan said Tuesday it received the money Monday from its U.S. parent, American Life Insurance Co., which is part of the AIG group, after the plunge in the price of AIG shares.
3) As a result, Alico Japan's capital base stands at 328.2 billion yen (US$3.2 billion), it said in a statement.
4) AIG teetered on the edge of failure before accepting an emergency loan from the U.S. government earlier this month. AIG last week signed an agreement with the Federal Reserve Bank of New York for a two-year, $85 billion emergency loan at an interest rate of about 11.5 percent.
5) AIG was brought to the brink of failure because of stresses caused by the collapse of the subprime mortgage market and the credit crunch that ensued.
6) The fall in the price of AIG shares had raised worries about Alico Japan.
7) AIG, the biggest insurance group in the United States, launched Alico Japan in 1973. Alico Japan has been reassuring its clients that there will be no problems with their insurance policies.


Former AIG CEO Greenberg bows out of House hearing
(APW_ENG_20081007.0634)
1) The former chief executive of American International Group Inc., has canceled his scheduled appearance at a House committee hearing examining the chain of events that led to the government's $700 billion bailout of the financial industry.
2) House Oversight and Government Reform Committee spokesman Karen Lightfoot confirmed that Maurice "Hank" Greenberg would not be appearing at Tuesday's hearing but said she did not know the reason. CNBC reported that Greenberg had bowed out because of illness.
3) Greenberg was one of three former AIG CEOs scheduled to testify before the committee. The Federal Reserve rescued AIG with a $85 billion loan Sept. 16.


Insurance giant AIG ' s role in market crisis probed
(APW_ENG_20081007.0641)
1) The government's rescue of American International Group Inc. last month is getting a critical eye from lawmakers examining the chain of events that forced a $700 billion bailout of the financial industry.
2) Three former AIG chief executive officers were scheduled to testify Tuesday before the House Oversight and Government Reform Committee, but one of them -- Maurice "Hank" Greenberg, the company's largest individual shareholder -- canceled his appearance.
3) Committee spokesman Karen Lightfoot said she did not know the reason for the cancellation, but CNBC reported that Greenberg had bowed out because of illness.
4) The hearing is the second in two days into financial excesses and regulatory mistakes that have spooked stock and credit markets and heightened fears about a global recession.
5) The Federal Reserve rescued AIG with the $85 billion loan Sept. 16, one day after investment bank Lehman Brothers declared bankruptcy when the government wouldn't come to its aid. Lehman Brothers' chief executive officer testified Monday before the congressional oversight panel but didn't shed much light on how the mid-September events cascaded into a collapse of credit markets requiring a broad bailout.
6) The government now holds warrants that can be converted into an 80 percent stake of AIG and there is hope taxpayers won't lose money on the deal since the company has profitable subsidiaries that could be sold to pay off the Fed's loan.
7) The Fed's move rescued the company from bankruptcy after the insurance conglomerate's exposure to enormous losses related to subprime mortgage securities forced it to the brink.
8) Problems at AIG did not come from its traditional insurance subsidiaries, but instead from its financial services operations, primarily its insurance of mortgage-backed securities and other risky debt against default. Government officials feared a panic might occur if AIG couldn't make good on its promise to cover losses on the securities; investors feared the consequences would pose a threat to the U.S. financial system, which led to the government bailout.
9) Despite the government's move on AIG and Congress agreeing to spend up to $700 billion to buy up soured mortgage-based securities and other bad debt, credit remains tight and the stock market continued to plunge downward Monday despite a brief rally at the end of the day.
10) For four decades Greenberg oversaw AIG's growth into a sprawling conglomerate with businesses in 130 countries. Also on deck is Robert B. Willumstad, the former CEO just ousted by Treasury Secretary Henry Paulson.
11) On Monday, Paulson named Neel Kashkari, 35, to head the office created under the emergency bailout enacted Friday. Kashkari, an assistant Treasury secretary for international affairs, helped draft the bailout legislation and is one of Paulson's closest advisers on the crisis.


Execs ' posh retreat after bailout angers lawmakers
(APW_ENG_20081008.0205)
1) Days after it got a federal bailout, American International Group Inc. spent $440,000 on a posh California retreat for its executives, complete with spa treatments, banquets and golf outings, according to lawmakers investigating the insurance company's meltdown.
2) AIG sent its executives to the coastal St. Regis resort south of Los Angeles even as the company tapped into an $85 billion loan from the government it needed to stave off bankruptcy. The resort tab included $23,380 worth of spa treatments for AIG employees, according to invoices the resort turned over to the House Oversight and Government Reform Committee.
3) The retreat did not include anyone from the financial products division that nearly drove AIG under, but lawmakers still were enraged over thousands of dollars spent on an outing for executives of AIG's main U.S. life insurance subsidiary.
4) "Average Americans are suffering economically. They're losing their jobs, their homes and their health insurance," the committee's chairman, Rep. Henry Waxman of California, said as he scolded the company during a lengthy opening statement at a hearing Tuesday. "Yet less than one week after the taxpayers rescued AIG, company executives could be found wining and dining at one of the most exclusive resorts in the nation."
5) Former AIG CEO Robert Willumstad, who lost his job a day after the Federal Reserve put up the $85 billion on Sept. 16, said he was not familiar with the conference and would not have gone along with it.
6) "It seems very inappropriate," Willumstad said in response to questioning from Rep. Elijah Cummings, a Maryland Democrat.
7) "Those executives should be fired," Democratic presidential candidate Sen. Barack Obama said at a debate with Sen. John McCain on Tuesday, referring to the retreat participants. Obama also said AIG should give the Treasury $440,000 to cover the costs of the retreat.
8) But Eric Dinallo, superintendent of the New York State Insurance Department, said he could see the value of such a retreat under the circumstances.
9) "Having been at large global companies and knowing what condition AIG was in ... the absolute worst thing that could have happened" would have been for employees and underwriters in its life insurance subsidiary to flee the company.
10) "I do agree there is some profligate spending there, but the concept of bringing all the major employees together ... to ensure that the $85 billion could be as greatly as possible paid back would have been not a crazy corporate decision," Dinallo told the House committee.
11) The hearing disclosed that AIG executives hid the full range of its risky financial products from auditors, both inside and outside the firm, as losses mounted, according to documents released by the committee, which is examining the chain of events that forced the government to bail out the conglomerate.
12) The panel sharply criticized AIG's former top executives, who cast blame on each other for the company's financial woes.
13) "You have cost my constituents and the taxpayers of this country $85 billion and run into the ground one of the most respected insurance companies in the history of our country," said Rep. Carolyn Maloney, a New York Democrat. "You were just gambling billions, possibly trillions of dollars."
14) AIG, crippled by huge losses linked to mortgage defaults, was forced last month to accept the $85 billion government loan that gives the U.S. the right to an 80 percent stake in the company.
15) Waxman unveiled documents showing that federal regulators at the Office of Thrift Supervision warned in March that "corporate oversight of AIG Financial Products ... lack critical elements of independence." At the same time, PricewaterhouseCoopers confidentially warned the company that the "root cause" of its mounting problems was denying internal overseers in charge of limiting AIG's exposure access to what was going on in its highly leveraged financial products branch.
16) Waxman also released testimony from former AIG auditor Joseph St. Denis, who resigned after being blocked from giving his input on how the firm estimated its liabilities.
17) Three former AIG executives were summoned to appear before the hearing. One of them, Maurice "Hank" Greenberg -- who ran AIG for 38 years until 2005 -- canceled his appearance citing illness but submitted prepared testimony. In it, he blamed the company's financial woes on his successors, former CEOs Martin Sullivan and Willumstad.
18) "When I left AIG, the company operated in 130 countries and employed approximately 92,000 people," Greenberg said. "Today, the company we built up over almost four decades has been virtually destroyed."
19) Sullivan and Willumstad, in turn, cast much of the blame on accounting rules that forced AIG to take tens of billions of dollars in losses stemming from exposure to toxic mortgage-related securities.
20) Lawmakers also upbraided Sullivan, who ran the firm from 2005 until June of this year, for urging AIG's board of directors to waive pay guidelines to win a $5 million bonus for 2007 -- even as the company lost $5 billion in the 4th quarter of that year. Sullivan countered that he was mainly concerned with helping other senior executives.


AIG executives spent thousands during hunting trip
(APW_ENG_20081016.0029)
1) First there was the $440,000 American Insurance Group Inc. spent entertaining executives days after receiving an $85 billion lifeline from the Federal Reserve, now it's $86,000 for a hunting trip in England as the faltering company reaped another $37.8 billion in taxpayer funded loans.
2) News of the hunting trip emerged Wednesday as New York Attorney General Andrew Cuomo ordered AIG to do away with golden parachutes for executives, golf outings and parties while taking government money to stay afloat.
3) "Even after the taxpayer-funded bailout of AIG, the company paid hundreds of thousands of dollars for luxurious retreats for its executives, including an overseas hunting party and a golf outing," Cuomo wrote in a letter to the New York-based insurer.
4) He said the spending could be "fraudulent conveyances" under a state law regarding debtors and creditors and noted that beyond those excesses millions were paid to executives who were running AIG as it faced dissolution with government help.
5) Cuomo said he has the power under state business law to review and possibly rescind any inappropriate AIG spending as long as the Federal Reserve is propping up the huge insurer with almost $123 billion in loans announced since Sept. 16.
6) Company officials said the hunting trip in the English countryside was an annual event for customers that had been planned months before the bailout. The company pledged -- as it did following the September trip -- to do everything possible to end such extravagances. They declined to say which AIG executives attended.
7) "This was an annual event for customers of the AIG property casualty insurance companies in the U.K. and Europe, and planned months before the Federal Reserve Bank of New York's loan to AIG," company spokesman Peter Tulupman said Wednesday morning.
8) In a prepared statement later in the day, the company said, "We will continue to take all measures necessary to ensure that these activities cease immediately. AIG's priority is to continue focusing on actions necessary to repay the Federal Reserve loan and emerge as a vital, ongoing business."
9) The company said last week it would stop "all nonessential conferences, meetings and activities that do not clearly maximize value and service given the current conditions."
10) Last month, and just days after the U.S. government stepped in to save AIG with the $85 billion taxpayer-funded loan, the company picked up a $440,000 tab for a weeklong retreat at the posh St. Regis Resort in California for top-performing insurance agents.
11) Lawmakers investigating AIG's meltdown said they were enraged that executives of AIG's main U.S. life insurance subsidiary spent a lavish amount on the retreat, complete with spa treatments, banquets and golf outings. Last week, White House Press Secretary Dana Perino called the event "despicable."
12) At that time, AIG issued a statement saying that the "business event" was planned months before the Sept. 16 bailout and that it was held for top-producing independent life insurance agents, not AIG employees. Of the 100 attendees, only 10 worked for the AIG unit hosting the event, it said.
13) The insurer said Chief Executive Edward Liddy sent a letter to Treasury Secretary Henry Paulson "clarifying the circumstances" of the event. In the letter, Liddy assured Paulson that AIG is "reevaluating the costs of all aspects of our operations in light of the new circumstances in which we are all operating."
14) The insurer then said it canceled a future California retreat that was to be held later this month.
15) Regarding the recent hunting trip, "We regret that this event was not canceled," Tulupman said Wednesday.
16) Shares of AIG fell 37 cents, or 13.2 percent, to $2.43 in trading Wednesday.


AIG taps $21B in additional Fed credit line
(APW_ENG_20081031.1362)
1) American International Group Inc. has reduced the amount it owes the U.S. government by $6.8 billion after the insurance company was granted access to the Federal Reserve's new commercial paper program.
2) In a regulatory filing Thursday, AIG said it would be able to access up to an additional $20.9 billion under the new program, designed to kick-start the flagging market for commercial paper. It used some of the proceeds to pay back part of an $85 billion government loan.
3) On Monday, the Fed said it would buy highly rated commercial paper with a three-month maturity, a move to bolster the market. Commercial paper consists of short-term, unsecured loans companies get to finance their day-to-day operations.
4) Figures released by the Federal Reserve Thursday showed that as of Wednesday, the government has loaned AIG $83.5 billion under two emergency facilities that were to help the New York-based insurer stave off bankruptcy. That figure was $90.3 billion a week ago.
5) In September, the Fed said it would provide AIG a two-year, $85 billion loan, and the central bank said recently it would loan the company an additional $37.8 billion.
6) In total, the government has put about $144 billion at AIG's disposal.
7) By tapping the newest source of money from the Fed, AIG was able to reduce the amount it had borrowed under the original $85 billion line of credit, company spokesman Joseph Norton said.


Fed ' s bailout for AIG swells to more than $150B
(APW_ENG_20081111.0026)
1) When the government offered an emergency loan to insurer American International Group in September, eyebrows shot up at the $85 billion price tag. Now it looks like pocket change.
2) The size of the AIG lifeline swelled to more than $150 billion on Monday, a record for a private company. But the head of the broader financial rescue package was cool to other companies reaching for a piece of the bailout pie.
3) The new AIG package includes a $40 billion chunk of the $700 billion financial bailout. It's the first time money from the big rescue bill has gone to any company other than a bank.
4) General Motors, Ford and Chrysler, burning through cash and bleeding jobs, are prodding the government for more help. The leaders of the House and Senate have urged Treasury Secretary Henry Paulson to get some of the $700 billion to the Big Three.
5) The automakers, covering all their options, are also pushing to get help as part of a new, multibillion-dollar stimulus package for the economy if Democrats push it through Congress when a lame-duck session convenes next week.
6) President-elect Barack Obama has said his transition team would explore options to provide relief to the auto industry, and President George W. Bush's press secretary said Monday the White House would "listen to" Congress if they try to help automakers.
7) Any money would be on top of the $25 billion in loans that Congress passed in September to help retool auto plants to build more fuel-efficient vehicles.
8) Neel Kashkari, the interim head of the $700 billion bailout program, was cool to the idea of funneling the money to companies beyond banks and AIG.
9) "This morning's action with AIG was a one-off event necessary for financial stability. It is not the establishment of a new program," he said at a financial conference in New York.
10) In a separate development late Monday, the Fed granted the request of credit card company American Express Co. to become a bank holding company.
11) Although the new status will subject the company to greater regulatory scrutiny, American Express will also gain access to the Fed's emergency lending program. The company, which last month announced plans to slash its global work force, has been hard hit by the credit crisis as even the more affluent consumers the company caters to struggle to pay off their debts.
12) The original Fed loan to AIG was $85 billion, and the Fed added a $38 billion loan in October. But that has not been enough to firm up the company, which is so big and interconnected to other firms that its failure would devastate the economy.
13) Under the new plan, the Fed will provide $60 billion in loans. The Treasury will provide $40 billion to buy up preferred stock. And the government will spend close to $53 billion to buy up mortgage-backed assets and other AIG contracts on debt.
14) Total package: $153 billion. And AIG has also taken advantage of a federal plan to buy up short-term debt routinely issued by companies, known as commercial paper.
15) The $40 billion going to AIG will buy preferred shares of company stock, giving taxpayers an ownership stake. In turn, restrictions will be placed on executive pay at the firm.
16) The Fed stepped in with an $85 billion loan in September because the company is so big -- linked to mutual funds and retirement products held by millions of Americans, not to mention ties to U.S. mortgages -- that its failure would have devastated the economy.
17) "The bailout continues, and essentially exemplifies the notion of `too big to fail,' said Anthony Sabino, a professor of law and business at St. John's University. "But the question must be asked: Where does it end?"
18) AIG also came under fire for spending hundreds of thousands of dollars on a California retreat just days after the Fed loan was announced in September.
19) In other bailout news Monday, mortgage finance company Fannie Mae said it may have to tap a $100 billion government lifeline as early as next year after posting a massive third-quarter loss.
20) Fannie Mae, seized by federal regulators more than two months ago, posted a staggering loss of $13 per share for the July-to-September quarter, compared with a loss $1.56 a share, for the same period last year.
21) The company's net worth -- what it owns minus what it owes -- fell to $9.4 billion at the end of September, from $44.1 billion at the end of last year. If that number turns negative, Fannie Mae said it would be required to tap Treasury for help.
22) The new package for AIG was unveiled as the insurer issued new, bleak quarterly results. It lost $24.5 billion in the third quarter after turning a $3.1 billion profit in the third quarter of 2007.
23) Under the restructuring, AIG also gets easier terms on the Fed loans, reducing the risk AIG will have to sell off assets at firesale prices to pay back the government.
24) "This is a very big deal for AIG. It essentially plugs two of the biggest holes that the company had," said Rob Haines, analyst at CreditSights.
25) Fed officials expressed confidence the money would eventually be repaid to taxpayers, and presidential press secretary Dana Perino said it would also be good for the fragile U.S. economy.
26) The federal help "will allow AIG to continue to restructure themselves in a way that will not hurt the overall economy. AIG is a large, interconnected firm," she said.
27) AIG Chief Executive Edward Liddy called the plan a "win-win."
28) "It sends a strong signal to our policy holders, to government, to regulators around the world, to our business partners and counterparts that AIG is in fact on the road to recovery," he said.


AIG to sell Canadian unit for about $308 million
(APW_ENG_20090113.0738)
1) American International Group Inc., which received a massive cash infusion last year from the U.S. government, said Tuesday it is selling AIG Life Insurance Company of Canada to the parent of the Bank of Montreal for about $308 million in cash.
2) The deal is part of the New York-based insurance giant's restructuring plans and is expected to close by June 1.
3) AIG Life of Canada, based in Toronto, sells insurance and retirement savings products, including universal and term life plans, critical illness plans and annuities. The company sells its services through more than 5,000 agents across Canada.
4) "Acquiring AIG Life of Canada will strengthen BMO's overall financial planning, wealth and retirement offering, giving us the ability to expand our client relationships through a comprehensive line up of products," Bill Downe, president and chief executive of Toronto-based BMO Financial Group said in a statement.
5) BMO Financial said it will take on AIG Life of Canada's 300 employees and 400,000.
6) In November, the U.S. government gave AIG a $150 billion rescue package to help the company pull through the credit crisis. That package replaced an earlier loan of $85 billion after it became apparent the insurer needed more funds.
7) AIG said in October it would sell off a number of business units to repay the original $85 billion government loan.
8) The company has not specifically disclosed the assets it would sell or the expected prices from the sales. However, AIG has said it plans to retain its U.S. property and casualty and foreign general insurance businesses, and plans to retain an ownership interest in its foreign life insurance operations.
9) As of Dec. 22, AIG had already sold interests in four businesses, and earlier in the month was said to be in the final stages of selling its U.S. personal lines business.
10) Shares of AIG rose a penny to $1.55 in morning trading Tuesday, while BMO Financial fell 18 cents to $26.77.


AIG Global Real Estate to sell fund management biz
(APW_ENG_20090126.0680)
1) AIG Global Real Estate, a real estate investment management unit for insurer American International Group Inc., said Monday it will sell its fund management business.
2) The fund management business operates 15 existing fund programs with more than $12.4 billion in assets under management and an additional $5.2 billion in equity capital commitments as of Sept. 30.
3) The business is a global asset adviser based in New York with regional operations in Europe, Japan, Latin America and Asia.
4) AIG is in the midst of selling many operating units as it looks to streamline its operations and help repay a $150 billion rescue package it received in November from the federal government. The government provided the support as AIG has been slammed by the ongoing credit crisis.
5) The $150 billion package replaced an earlier loan of $85 billion after it became apparent the insurer needed more funds.
6) AIG said in October it would sell off a number of business units to repay the original $85 billion government loan.
7) The company has not specifically disclosed the assets it would sell or the expected prices from the sales. However, AIG has said it plans to retain its U.S. property and casualty and foreign general insurance businesses, and plans to retain an ownership interest in its foreign life insurance operations.
8) Bank of America Corp. and Merrill Lynch & Co., AIG Global Real Estate's financial advisers, have begun to solicit bids for the fund management business.


UK fraud agency investigating AIG
(APW_ENG_20090212.0919)
1) Britain's Serious Fraud Office says it has launched a preliminary inquiry into the operations of AIG Financial Products Corp., a British subsidiary of American International Group, Inc.
2) The agency said Thursday is was cooperating with U.S. authorities who were already investigating AIG Financial Products Corp.
3) The Serious Fraud Office said its investigation did not involve AIG's insurance business in Britain or elsewhere.


AIG evaluating new funding with NY Fed
(APW_ENG_20090223.1350)
1) American International Group Inc. said Monday that it is evaluating "potential new alternatives" to tackle the giant insurer's financial problems.
2) "We continue to work with the Federal Reserve Bank of New York to evaluate potential new alternatives for addressing AIG's financial challenges," AIG spokesman Joseph Norton said. "We will provide a complete update when we report financial results in the near future."
3) The comments came after CNBC reported that the New York-based insurer will soon report a $60 billion loss and ask the government for more support.
4) The Treasury Department and the Federal Reserve declined to comment.
5) On the brink of failure in September, AIG was bailed out when the government offered it an $85 billion loan. AIG's bailout swelled to about $150 billion in November when the Federal Reserve and U.S. Treasury stepped in with more cash after it became apparent the insurer needed more funds to stay afloat.
6) Problems at AIG did not come from its traditional insurance operations, but from its financial services units, primarily its business insuring mortgage-backed securities and other risky debt against default.
7) If AIG couldn't make good on its promise to pay back soured debt, investors feared the consequences would pose a threat to the U.S. financial system, leading to the government bailout.
8) Shares of AIG fell 1 cent to close at 53 cents.


US government extends new aid package to AIG
(APW_ENG_20090302.0429)
1) The U.S. government unveiled a revamped rescue package for insurance giant American International Group on Monday, and will provide the troubled company another $30 billion on an "as needed" basis. AIG also reported a large fourth-quarter loss.
2) The company has burned through cash and has been unable to find buyers for pieces of its business that it hoped to sell to repay the government on its existing aid package, which totals some $150 billion.
3) The new package calls for the Federal Reserve to take stakes in two international units.
4) Instead of paying back $38 billion in cash with interest that it has used from a Federal Reserve credit line, AIG now will repay that amount with equity stakes in Asia-based American International Assurance Co. and American Life Insurance Co., which operates in 50 countries.
5) AIG said it lost $61.7 billion in the fourth quarter, or $22.95 per share, after a loss of $5.3 billion, or $2.08 per share, a year ago.
6) The latest results include $7.2 billion in unrealized losses and credit valuation adjustments at AIG Financial Products, the source of credit-default swaps, and pretax losses of $21.6 billion tied to the declining value of AIG's investment portfolio.


Senators ask regulators about $180B AIG bailout
(APW_ENG_20090305.1061)
1) Regulators defended their roles in the oversight and bailout of failed insurance giant American International Group Inc. in Congress Thursday.
2) Sen. Richard Shelby, an Alabama Repuiblican, called the company "the greatest corporate failure in American history" and said its problems came from its insurance divisions as well as from widely criticized risky deals involving complex financial derivatives.
3) AIG reported Monday that it had a $61.7 billion quarterly loss, the worst in U.S. history. The same day, Treasury provided the company a new $30 billion loan from the $700 billion financial bailout program, giving the company access to more than $170 billion in taxpayer money.
4) The government effectively controls the insolvent company, with the Treasury Department holding an up to 79.9 percent stake.
5) "The question is, who is actually being rescued," said committee chairman Sen. Chris Dodd, questioning Federal Reserve Vice Chairman David Kohn.
6) AIG was the top issuer of credit default swaps, which provided insurance for corporate bonds, and it has spent billions trying to wind these down. Kohn refused to say which companies had benefited from the winding down of AIG's financial relationships.
7) "We need AIG to be stable ... and I would be very concerned that if we started giving out the names of counterparties, people wouldn't want to do business with AIG," Kohn said.
8) Dodd urged him to reconsider the refusal to name other financial companies that had benefited from AIG's bailouts.
9) "Public confidence in what we're doing is at stake, and right now the public is deeply, deeply troubled by this," Dodd said. "...We're going to have an awfully difficult time ... if we can't get answer to this."
10) The hearing comes on the heels of unusual and withering criticism from Federal Reserve Chairman Ben Bernanke Tuesday.
11) "I share your concern, I share your anger," Bernanke told the Senate Budget Committee. "It's a terrible situation, but we're not doing this to bail out AIG or their shareholders. We're doing this to protect our financial system and to avoid a much more severe crisis in our global economy."
12) AIG's new $30 billion loan earlier this week brought the company's bailout to more than $170 billion since Sept. 16. The government also has adjusted the terms of AIG's loans to make the debt easier on the company's balance sheet.
13) AIG is so big and sprawling, so intertwined with institutions around the globe, that its downfall could set off a vicious chain reaction. Upheaval on such a global scale would plunge the U.S. economy deeper into recession, drive up unemployment and stifle hopes for an economic rebound any time soon.
14) The company provides life, property and other insurance offerings, with 30 million policyholders in the United States alone. It also provides asset-management services and airplane leases.
15) New York insurance superintendent Eric Dinallo defended the patchwork system of state insurance regulation, saying the sole problem was in AIG's financial products division, which dealt in complex derivatives, and that state insurance regulators had done "a very good job." He said that without federal money, the company's insurance divisions would be $10 billion in the black.


Reports name AIG ' s derivative counterparties
(APW_ENG_20090307.0867)
1) The federal bailout of insurance giant American International Group Inc. has benefited at least two dozen U.S. and foreign financial institutions who collected some $50 billion, according to media reports Saturday.
2) AIG -- once the world's largest insurer -- is paying money to its counterparties because it had agreed to guarantee them against losses from credit default swaps they had invested in.
3) Citing a confidential document and people familiar with the matter, The Wall Street Journal said recipients of AIG money include Goldman Sachs Group Inc. and Germany's Deutsche Bank AG, each of which received roughly $6 billion in payments between mid-September and December 2008.
4) Also receiving AIG money last year were Merrill Lynch, now part of Bank of America Corp., French bank Societe Generale SA and, to a lessor extent, Morgan Stanley, Royal Bank of Scotland Group PLC and HSBC Holdings PLC, the newspaper said.
5) Meanwhile, business magazine Fortune on Saturday issued its own list of 15 banks that received AIG money, including: Calyon, Credit Agricole of France; UBS; Barclays; Coral Purchasing, DZ Bank of Germany; Bank of Montreal; Rabobank of the Netherlands. Fortune, which credited a "reliable source," did not supply dollar amounts that each bank received.
6) The disclosures come the same week the Fed refused a congressional request for the names of all AIG's derivative counterparties. At a hearing Thursday, Federal Reserve Vice Chairman David Kohn declined to reveal who had been made whole after deals with AIG went bad, arguing that the information would undermine what little confidence remains in the financial markets.
7) AIG on Monday reported a $61.7 billion quarterly loss, the worst in U.S. history. The same day, Treasury provided AIG as much as $30 billion in additional aid from the $700 billion financial bailout program, bringing the company's total bailout to more than $170 billion since September. The government now owns nearly 80 percent of the company.
8) AIG has been forced to seek more help in part because of the ongoing recession and its falling stock price, now well under $1. Among its biggest problems: It can't sell assets to pay back government loans because the credit crisis is preventing would-be buyers from getting financing to complete such deals.
9) A representative with New York-based AIG wasn't immediately available to comment.


AIG says emergency aid used to pay other banks
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1) American International Group Inc. used more than $90 billion in federal aid to pay out foreign and domestic banks, some of whom had received their own multibillion-dollar U.S. government bailouts.
2) Some of the biggest recipients of the AIG money were Goldman Sachs at $12.9 billion, and three European banks -- France's Societe Generale at $11.9 billion, Germany's Deutsche Bank at $11.8 billion, and Britain's Barclays PLC at $8.5 billion. Merrill Lynch, which also is undergoing federal scrutiny of its bonus plans, received $6.8 billion as of Dec. 31.
3) The embattled insurer's disclosure on Sunday came amid outrage on Capitol Hill over its payment of tens of millions in executive bonuses, and followed demands from lawmakers that the names of trading partners who indirectly benefited from federal aid to AIG be made public.
4) The company, now about 80 percent owned by U.S. taxpayers, has received roughly $170 billion from the government, which feared that its collapse could cause widespread damage to banks and consumers around the globe.
5) "The ability of AIG to meet its obligations is important to the stability of the U.S. financial system and to getting credit flowing to households and businesses," Federal Reserve spokeswoman Michelle Smith said.
6) The money went to banks to cover their losses on complex mortgage investments, as well as for collateral needed for other transactions.
7) Other banks receiving between $1 billion and $3 billion from AIG's securities lending unit include Citigroup Inc., Switzerland's UBS AG and Morgan Stanley.
8) Municipalities in certain states, including California, Virginia and Hawaii, received a total of $12.1 billion under guaranteed investment agreements.
9) The company said it used billions more to fund its Maiden Lane business, which was set up following the federal bailout to purchase toxic assets, and to repay debt and provide capital for some of its operations.
10) "I've been asking for this information for months. This is a good first step, but I'm concerned by how long it took,' said Rep. Carolyn Maloney, who is chair of Congress' Joint Economic Committee.
11) The details from AIG came after Obama administration officials and top Republicans voiced sharp criticism over $165 million in bonus payments AIG said it must make Sunday. The contracts are part of a larger total payout which has been reportedly valued at $450 million.
12) In a letter to Treasury Secretary Timothy Geithner dated Saturday, AIG Chairman Edward Liddy said outside lawyers informed AIG that it had contractual obligations to make the payments and could face lawsuits if it did not do so.
13) Liddy said the company entered into the bonus agreements in early 2008 before AIG got into severe financial straits and was forced to obtain a government bailout.
14) AIG has agreed to the Obama administration's requests to restrain future payments.


Obama berates AIG, vows to try to block bonuses
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1) President Barack Obama called AIG reckless and greedy during a blistering attack in which he pledged to try to block the insurance giant from handing its executives millions of dollars in bonuses after taking billions in federal aid.
2) The White House said it's looking at restrictions on some $30 billion in taxpayers' money approved to help American International Group as the administration tries to reclaim or block the huge bonuses the struggling company awarded its executives.
3) Obama on Monday joined other officials in criticizing AIG, the company that has quickly become the symbol for the ways in which America's federal bailouts have gone awry.
4) Obama expressed outrage at reports that AIG went ahead with $165 million in bonuses even though the company received more than $170 billion in federal rescue money. Obama directed Treasury Secretary Timothy Geithner to see whether there was any way to retrieve or stop the bonus money -- a move designed as much for public relations as for public policy.
5) "How do they justify this outrage to the taxpayers who are keeping the company afloat?" Obama asked. "This isn't just a matter of dollars and cents. It's about our fundamental values."
6) A public backlash against Washington over the bonuses would make it tougher for Obama to ask Congress later for more bailout help -- and jeopardize other parts of the recovery agenda that has dominated the early weeks of his presidency.
7) With that in mind, the president and his top aides were working hard to distance themselves from the insurer's conduct, to contain possible political damage and to try to bolster public confidence in his administration's handling of the broader economic rescue effort.
8) Bailout steps for AIG totaling over $170 billion since September have effectively left the federal government with an 80 percent stake in the faltering insurance giant.
9) The financial bailout program remains politically unpopular and has been a drag on Obama's new presidency, even though the plan began under his predecessor, President George W. Bush. The White House is aware of the nation's bailout fatigue; hundreds of billions of taxpayer dollars have gone to prop up financial institutions that made poor decisions, while many others who have done no wrong have paid the price.
10) David Axelrod, senior adviser to Obama, said in an interview with The Associated Press that there was no question that the public's anger over the bonuses could derail administration efforts to right the economy.
11) "People are angry because they've seen exhibit after exhibit of irresponsibility and people walking away with money in their pockets,"Axelrod said. "It's undermined the discussion that we have to have."
12) News that AIG still needs billions in taxpayer dollars to prevent a collapse did little to build public confidence, Obama aides acknowledged. Seeking to turn the public tide, White House spokesman Robert Gibbs aggressively criticized AIG and said administration officials were working to put strict limits on the next $30 billion installment bound for the company.
13) "Treasury has instruments that can address the excessive retention bonuses, and add provisions to ensure that taxpayers are made whole," Gibbs said.
14) Obama had scheduled a speech Monday to announce new help for recession-pounded small businesses, but first used the occasion to tear into AIG.
15) "This is a corporation that finds itself in financial distress due to recklessness and greed," Obama declared.
16) Axelrod called the bonuses "spectacularly tone-deaf."
17) He said the administration hoped the tough talk would result in voluntary action on the part of AIG and its bonus recipients, although that remains an open question. "All we can do is administer this thing going forward," he said.
18) A call to AIG's corporate headquarters in New York seeking comment was not returned immediately late Monday.
19) In a letter to Geithner over the weekend, the government-appointed chief executive of AIG, Edward Liddy, said the bonuses were legally binding obligations and the firm's "hands are tied."
20) On a separate track, New York Attorney General Andrew Cuomo said Monday he would issue subpoenas for information on the bonuses after AIG missed his deadline for providing details. Cuomo said his office would investigate whether the employees receiving bonuses were involved in AIG's near-collapse and whether the $165 million in bonus payments were fraudulent under state law.
21) AIG spokeswoman Christina Pretto told The Associated Press, "We are in contact with the attorney general and will of course respond to his request."
22) Obama's sharp words continued an insistent administration drumbeat over the past few days designed to pressure the bonus recipients to forgo them. Pressure was building on that issue -- and on the government to rework its AIG bailout to make sure the company repays as much of the $170 billion as possible.
23) So far, the company has been honoring its contracts with U.S. and foreign banks. The government agreed to uphold those contracts when it seized control of AIG in September, contending that failure would bring even worse global economic problems.
24) Obama was planning an appearance later in the week on Jay Leno's NBC talk show, perhaps to add a lighter touch to his efforts to show himself in command of efforts to resuscitate the economy.
25) The AIG bonuses were revealed over the weekend. It also was disclosed that AIG used $90 billion-plus in federal aid to pay foreign and domestic banks, some of which had received their own multibillion-dollar U.S. government bailouts.
26) The recipients included Goldman Sachs, at $12.9 billion, and three European banks -- France's Societe Generale at $11.9 billion, Germany's Deutsche Bank at $11.8 billion, and Britain's Barclays PLC at $8.5 billion. Merrill Lynch, which also is undergoing federal scrutiny of its bonus plans and which is now part of Bank of America, had received $6.8 billion as of Dec. 31.
27) The money went to banks to cover their losses on complex mortgage investments, as well as for collateral needed for other transactions.
28) The AIG news overshadowed what Obama's aides had hoped to spend the first part of the week discussing: billions of dollars to help the nation's small businesses in the hopes of getting credit flowing again. Obama heaped praise on the little guys of American industry, often overshadowed in the blitz of government bailouts.
29) Obama's latest plan allows the government to spend up to $15 billion to buy the small-business loans that are now choking community banks and lenders. That, in turn, could allow those banks to start lending money again to small companies to invest, pay bills and stay afloat.
30) "You deserve a chance. America needs you to have a chance," Obama said in an appeal to all those who run small businesses or hope to one day.
31) Small businesses have created about 70 percent of the new jobs over the past decade, and as their credit lines have dried up, so has their ability to thrive or survive.
32) On Capitol Hill, House Republican leader Rep. John Boehner was unmoved. He called Obama's White House event "simply an attempt to provide political cover for the job-killing burden the president's budget would place on our nation's small businesses."
33) Two months into office, Obama's job approval rating is 61 percent, according to Gallup polling. That number has been relatively stable so far this month but has dropped from the 68 percent when the president took office. The major factor has been a decline in support among Republicans, from 41 percent to 26 percent.
34) A separate poll out Monday by the Pew Research Center put Obama's approval at 59 percent, slipping from 64 percent last month. The Pew poll found that a growing number of Americans see him as listening more to the liberals than to the moderates in the Democratic Party.


AIG sells stakes in 3 Spanish solar plants
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1) Embattled insurer American International Group Inc. said Wednesday that one of its units sold stakes in three Spanish solar plants. Terms weren't disclosed.
2) The interests are being sold by AIG Financial Products Corp., a subsidiary of the New York-based insurance giant. The deal is part of AIG's ongoing restructuring plans. HG Capital, a London based private equity firm focused on renewable energy, acquired the stakes.
3) The financial products group, which has come under heavy scrutiny in recent days because of bonuses its employees received, began unwinding businesses and portfolios as AIG looks to repay hundreds of billions of dollars in loans from the federal government. AIG's chief executive, Edward Liddy, was testifying before Congress Wednesday about the payments of those bonuses.
4) The solar plant sale was the latest in a string of sales at the financial products group and for the entire company. Last month the financial products unit sold two groups of contracts for $60.5 million that provide upfront cash to oil and gas well owners in return for dedicated production from the wells. Overall, the insurer has now sold stakes in 10 businesses as it looks to repay the government's loans.
5) Once one of the world's largest insurers, AIG was strapped for cash as it was hit hard by deterioration in the credit markets and concerns that the complex, structured investments it insures would increasingly default.
6) AIG has received about $180 billion in financial support from the government since the company unraveled in September. Most recently it received $30 billion in early March at the same time it reported a record $61.7 billion fourth-quarter loss.
7) Problems at AIG did not come from its traditional insurance subsidiaries, but from its financial services operations, and primarily its writing of credit default swaps -- essentially insurance on mortgage-backed securities and other risky debt against default.


Obama envoy Holbrooke once served on AIG ' s board
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1) Obama administration special envoy Richard Holbooke was on the American International Group Inc. board of directors in early 2008 when the insurance company locked in the bonuses now stoking outrage across the U.S.
2) Holbrooke, a veteran diplomat who is now the administration's point man on Pakistan and Afghanistan, served on the board between 2001 and mid-2008. During that period, AIG undertook the aggressive investment strategies that led to a near-collapse and forced a multibillion-dollar federal bailout.
3) President Barack Obama has insisted his administration was not responsible for AIG's financial woes, and a White House spokesman said Thursday that Holbrooke was unaware of AIG's decision to award retention bonuses to key employees.
4) "Mr. Holbrooke had nothing to do with and knew nothing about the bonuses," spokesman Tommy Vietor said.
5) Close to $165 million in bonus money was paid last weekend.
6) It remains unclear whether AIG's decision to grant the bonuses ever came before the board. A Holbrooke spokesman declined comment, referring calls to the White House.
7) Obama named Holbrooke as a special envoy on Jan. 22, two days after taking office. Vietor said administration officials were aware of Holbrooke's work for AIG during background checks this year -- when AIG already had benefited from federal intervention.
8) "Disclosure of past board membership is part of the vetting process," Vietor said.
9) Holbrooke was U.S. ambassador to the United Nations during the final two years of the Clinton administration and architect of the 1995 accord that ended the war in Bosnia.
10) Holbrooke joined AIG's board in February 2001 and resigned in July 2008, two months before the company nearly collapsed. Over more than seven years as a board member, he may have earned as much as $800,000 in cash and company stock, according to AIG financial documents filed with the Securities and Exchange Commission.
11) Since September, AIG has received $180 billion in taxpayer money to keep it from failing and causing more damage to the U.S. economy.
12) An AIG spokesman did not respond to telephone calls and e-mails Thursday.
13) Obama this week blasted AIG for what he described as the company's reckless course. He also defended his administration's handling of the company's rescue.
14) "Nobody here was responsible for supervising AIG and allowing themselves to put the economy at risk by some of the outrageous behavior that they were engaged in," the president said.
15) Vietor said Holbrooke "has not discussed AIG with the president, Treasury or any other member of the administration."
16) AIG chose to approve the executive bonuses in the spring of 2008 "despite obvious signs the 2008 performance would be disastrous in comparison to the year before," New York Attorney General Andrew Cuomo wrote the House Financial Services Committee on Tuesday. Cuomo's office is investigating AIG's executive compensation programs.
17) For large companies such as AIG, boards of directors are typically made up of high-profile figures from business and academia.
18) Boards are expected to give the company's top leaders unvarnished advice. But with AIG on life support, the quality of the guidance the company received from its board is under fire.
19) "The role of a board is to keep a company from going over a cliff," said Robert Litan, an expert on financial institutions at The Brookings Institution in Washington. "I wouldn't be surprised if, in a future lawsuit, a court were to find the (AIG) directors behaved negligently."
20) For much of tenure on the AIG board, Holbrooke had a role in approving salaries and compensation. From 2001 until mid-2005, he was a member of the board's compensation committee. According to AIG financial statements, the committee sets the salary for the company's chief executive officer and gives advice on how other senior managers are to be compensated.
21) Holbrooke also led the board's public policy and social responsibility committee from 2005 through July 2008. The committee assesses how political and public policy issues might affect the company's business operations, performance and corporate reputation, according to AIG.
22) The actual amounts Holbrooke received as an AIG board member are difficult to pinpoint. Before 2005, the SEC reporting requirements did not call for dollar figures to be attached to the stock and option awards for directors. AIG stock awarded for board service may now be worth far less than the value it had originally.
23) According to the SEC filings, AIG paid Holbrooke $267,943 in fees and stock awards in 2007; he was paid $232,865 in 2006. Compensation figures for the six months he was on the board in 2008 are not yet available. By prorating his 2007 compensation, he could have earned about $107,500 in directors fees and stock.
24) Between 2001 and 2005 the records indicate he earned $200,000 in director's fees. He also received 2,400 shares of AIG stock and options to purchase 10,000 more during that period.


Former AIG head denies he started bonuses
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1) Former AIG chief executive officer Hank Greenberg said the company under his leadership never had the kind of retention bonus system that has subjected it to withering criticism.
2) "When I was there, nobody had a contract with the company, including me," Greenberg said in a nationally broadcast interview Friday. "If you didn't do the job, you didn't deserve to be there. We had a bonus plan based on performance."
3) Greenberg's interview was broadcast on CBS's "The Early Show" a day after the Democratic-led House approved a bill that would impose punitive taxes on big employee bonuses from AIG and other firms bailed out by taxpayers.
4) "We want our money back and we want our money back now for the taxpayers," declared House Speaker Nancy Pelosi, who is a Democrat.
5) The bonuses, totaling $165 million, were paid to employees of the troubled insurer, including to traders in the financial unit that nearly caused the company's collapse.
6) On Wednesday, the current chairman and chief executive of AIG, Edward Liddy, told Congress under oath that his predecessor was responsible for the financial problems the company now is experiencing, saying mistakes had been made on a scale few could have imagined.
7) Greenberg said he would not have paid out the retention bonuses had he still been at the helm of the company.
8) Greenberg said that AIG once was "the greatest company in history."
9) "Was there fraud? Was there whatever. I think it's stupidity. Well, do you punish stupidity," he said.
10) The bill was passed on a 328-93 margin despite sharp Republican attacks calling it a legally questionable ploy to cover up Obama administration missteps on this issue.


Protesters visit AIG officials ' lavish homes
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1) A busload of activists representing working- and middle-class families paid visits Saturday to the lavish homes of American International Group executives to protest the tens of millions of dollars in bonuses awarded by the struggling insurance company after it received a massive federal bailout.
2) About 40 protesters sought to urge AIG executives who received a portion of the $165 million in bonuses to do more to help families.
3) News of the bonuses last week ignited a firestorm of controversy and even death threats against AIG employees. The company, which is based in New York, has received $182.5 billion in federal aid and now is about 80 percent government-owned, while the national housing and job markets have collapsed as the country spirals into a crippling recession.
4) American International Group Inc. has said it was contractually obligated to give the retention bonuses, payments designed to keep valued employees from quitting, to people in its financial products unit, based in Wilton, Connecticut. Congress began action on a bill that would tax 90 percent of the bonuses, and the company's chief executive urged anyone who received more than $100,000 to return at least half.
5) AIG has argued that retention bonuses are crucial to pulling the company out of its crisis. Without the bonuses, the company says, top employees who best understand AIG's business would leave.
6) "We think $165 million could be used in a more appropriate way to keep people in their homes, create more jobs and health care," said protester Emeline Bravo-Blackport, a gardener.
7) She marveled at AIG executive James Haas' colonial house, which has stunning views of a golf course and the Long Island Sound. The Fairfield house is "another part of the world" from her life in nearby Bridgeport, which flirted with bankruptcy in the 1990s and still struggles with foreclosures and unemployment."
8) "Lord, I wonder what it's like to live in a house that size," she said.
9) Another protester, Claire Jeffery, of Bloomfield, said she's on the verge of foreclosure. She works as a housekeeper; her husband, a truck driver, can't find work.
10) "I love my home," she said. "I really want people to help us."
11) The company, in response to the protests, said all its employees were "working very hard to pay back the government and help the U.S. economy recover."
12) "The people working at AIG today are part of the solution, not part of the problem," company spokeswoman Christina Pretto said in an e-mailed statement.
13) Besides Haas' home, protesters on Saturday also visited the Fairfield home of AIG executive Douglas Poling. They were met both times by security guards. They left letters that acknowledged some executives, including Haas and Poling, are giving up the money but that asked them to support higher taxes on families earning more than $500,000 a year.
14) "You have a wonderful opportunity to help your neighbors in Connecticut," the letters said. "We ask you to consider the experiences of families struggling in this economy."
15) Afterward, the group protested at the office of AIG's financial products division in Wilton, where they waved signs and chanted, "Money for the needy, not for the greedy!"
16) There were no arrests.
17) Mary Huguley, of Hartford, said AIG executives should share their wealth with people like her sister, who is facing foreclosure.
18) "You ought to share it, and God will bless you for doing it," she said.
19) The protests came amid new questions about the retention bonuses. State Attorney General Richard Blumenthal said Saturday that documents turned over to his office by AIG appeared to show that the company paid $53 million more in bonuses to its financial products division than previously reported.
20) AIG said Blumenthal was wrong. It said the payments to which he referred had been made months ago and had been disclosed to the U.S Department of the Treasury.
21) In New York, the state Republican Party says the Democrat-controlled state government is ignoring calls for an investigation into a $100,000 donation to the state Democratic Party from American International Group days before officials initiated the bailout of the insurance giant.
22) State Republican Chairman Joseph Mondello accuses Democrats of a duck-and-cover response to disclosure of the donation, first reported Thursday by The Associated Press. Campaign finance records show AIG donated $100,000 on Aug. 29 to the Democrats, by far its largest donation to the party since at least 1999. Insurance Superintendent Eric Dinallo said he started negotiating with AIG and federal officials days later, but the governor hadn't been informed.
23) On Sept. 16, Gov. David Paterson in a televised news conference announced the "great news" that New York officials helped the giant insurer strike a historic loan deal with the Federal Reserve to keep AIG afloat.


AIG exec resigns on NY Times op-ed page
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1) An American International Group Inc. executive who received a retention bonus worth more than $742,000 after taxes has resigned publicly -- in an Op-Ed column in The New York Times.
2) Jake DeSantis, an executive vice president at AIG's Financial Products division, said Wednesday he is leaving the company and will donate his entire bonus to charity. The letter, addressed to AIG's CEO, Edward Liddy, criticized Liddy for, among other things, agreeing to the payments but then calling the bonuses "distasteful" as he testified before disapproving members of Congress.
3) "We in the financial products unit have been betrayed by AIG and are being unfairly persecuted by elected officials," wrote DeSantis, who was head of business development for commodities. "In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself."
4) He added: "I take this action after 11 years of dedicated, honorable service to AIG. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so."
5) New York-based AIG has been heavily criticized by government offficials and the public after it awarded $165 million in bonuses earlier this month. The retention bonuses, payments designed to keep valued employees from quitting, were paid out whether the employee had a great year or a terrible one.
6) The bonuses were given to employees of the financial products division, a global unit that issued derivatives called credit default swaps that helped sink AIG as a whole last year.
7) "Ed deeply appreciates the frustration expressed in this letter and believes that the recent vilification and harassment of AIG employees is grossly unfair and unwarranted," wrote AIG spokesman Mark Herr in a statement e-mailed to The Associated Press.
8) Attempts to reach DeSantis were unsuccessful.
9) Two days after AIG received its first injection from the government in mid-September, AIG named Liddy, former chairman of Allstate Corp., as chairman and chief executive succeeding Robert Willumstad, who stepped down after three months on the job.
10) Liddy told Congress last week that the retention payments -- ranging from $1,000 to nearly $6.5 million -- were not his idea and called them "distasteful" Liddy himself is not getting a bonus and is only drawing $1 a year in salary. The bonuses were promised in contracts with employees that AIG signed early last year, long before then-Treasury Secretary Henry Paulson asked Liddy to take over the company.
11) "I have the utmost respect for the civic duty that you are now performing at AIG," DeSantis wrote in the letter. "You are as blameless for these credit default swap losses as I am." AIG had invested heavily in credit default swaps, extremely risky insurance contracts for bonds and other investments.
12) Even so, DeSantis said he is disappointed and frustrated over what he called Liddy's lack of support.
13) "I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our payments," DeSantis wrote in the letter, which was sent Tuesday to Liddy.
14) DeSantis noted that Liddy had decided to accelerate by three months the payout of more than a quarter of the bonus money. "That action signified to us your support, and was hardly something that one would do if he truly found the contracts "distasteful," he said.
15) Liddy told Congress last week that some of the employees were willing to give the money back, and on Monday, New York Attorney General Andrew Cuomo said 15 of the top 20 bonus recipients agreed to return their money. In total, about $50 million of the $165 million will be returned, Cuomo's office said Monday.
16) AIG has expressed concern that the company may not be able to attract and retain talented employees if they believe their compensation is subject to adjustment by the government.
17) An AIG spokesman said Monday that a "handful" of senior-level executives have resigned from the financial products division, and that there will likely be more resignations to come.
18) AIG came close to collapsing last September because it had gotten heavily into the business of insuring mortgage-backed securities, the risky investments that are at the root of the hundreds of billions of dollars in losses suffered by banks and other financial institutions around the world.
19) Since September, the government has given AIG $182.5 billion, maintaining that without help, AIG would fail, further disrupingt already stricken markets and cause more damage to the economy. In return for the aid, the government took a nearly 80 percent stake in AIG.


Former AIG chief Greenberg criticizes bonuses
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1) Former AIG chief executive Maurice "Hank" Greenberg slammed the company for paying out millions in bonuses to its controversial financial unit after wracking up massive losses that prompted a bailout by the U.S. government.
2) "Why would you pay them a bonus to make up for the losses?" Greenberg said in a speech to the American Chamber of Commerce in Hong Kong. "There was no reason to pay them bonuses ... It didn't make any sense."
3) Recent bonuses worth $165 million paid to employees of the troubled insurer -- including to traders in the financial unit that nearly caused the company's collapse -- have sparked widespread outrage in the U.S. after the government committed more than $182 billion to keeping the company afloat.
4) Last week, the House of Representatives voted to tax away 90 percent of any bonuses agreed to in 2008 and paid this year by AIG or other recipients of bailout money.
5) "I can understand the American people being upset. This thing has been so upsetting to many people," he said.
6) Greenberg has sued AIG, saying the company that he led for 38 years misled investors about its exposure to subprime mortgages and ruined his fortune by lying about its financial health.
7) Asked to detail his own losses, Greenberg declined to specify.
8) "A lot," he said. "I know how much."
9) The lawsuit filed earlier this month says Greenberg was the New York-based company's largest non-institutional shareholder. The company has said the suit is without merit.


AIG managers in Europe leave amid bonus spat
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1) Two of American International Group Inc.'s top managers in Paris have resigned, just days after agreeing to return controversial retention bonuses.
2) The news of more dissension at AIG comes a day after Jake DeSantis, an executive in the insurer's financial products division, publicly resigned in an Op-Ed column in The New York Times. DeSantis said he plans to donate his bonus -- $742,000 after taxes -- to charity.
3) AIG said Mauro Gabriel, president and chief executive of Paris-based Banque AIG, and Jim Shephard, deputy CEO, resigned from their roles on March 20.
4) The men "resigned from their roles given shared concerns regarding their ability to conduct business in the current hostile environment toward Banque AIG and AIG Financial Product employees generally," AIG spokeswoman Christina Pretto said in an e-mail to The Associated Press.
5) AIG said both men have agreed to stay for a transition period, although for how long was not immediately known.
6) Pretto's e-mail came in response to a Wall Street Journal story that said the resignations of the Paris employees could spark defaults on $234 billion of derivative transactions unless replacements for the two executives are found, according to The Wall Street Journal.
7) "Given their commitment, we believe that the status of the Banque AIG derivatives book will remain unchanged and in good standing," Pretto said.
8) According to the Journal report, if AIG fails to find replacements for Gabriel and Shephard acceptable to French regulators, the regulators can appoint their own designee to manage the bank. Such an outcome could trigger defaults under the bank's derivative contracts since it would represent a change in control.
9) A default could set off a chain reaction costing financial firms, including European banks that did business with AIG, billions of dollars -- similar to what the U.S. government was trying to prevent when bailing out the giant insurer.
10) New York-based AIG has been heavily criticized by government officials and the public after it awarded $165 million in bonuses earlier this month. The office of New York Attorney General Andrew Cuomo has also been investigating the retention bonuses, or payments designed to keep valued employees from quitting.
11) The bonuses were given to employees of the financial products division, a global unit that issued derivatives called credit default swaps, which drove AIG almost to collapse last year. Once the world's largest insurer, AIG has received $182.5 billion in financial support from the government since September. Problems at AIG did not come from its traditional insurance subsidiaries, but from the problems at the financial products division.
12) The government stepped in to provide support because of fears that a collapse of AIG would trigger hundreds of billions of dollars in losses at financial institutions worldwide, further crippling the already battered credit markets.
13) Cuomo's investigation has expanded beyond just looking at the bonuses paid to employees in the financial products group to the derivative products it originated, how it wrote contracts surrounding the products and its process of unwinding the deals. Cuomo's office has been routinely investigating bonus payments at companies that received government funds.
14) On Thursday, Cuomo's office issued a subpoena to AIG requesting information about the products that led to the unraveling of AIG, such as credit default swaps -- essentially insurance against default on mortgage-backed securities and other risky debt.
15) "The question is whether the contracts are being wound down properly and efficiently or whether they have become a vehicle for funneling billions in taxpayers dollars to capitalize banks all over the world," Cuomo said in a statement.
16) From the initial bailout, AIG has been working to unwind the positions in its financial products unit and sell off other businesses to help repay the government loans.
17) "Banque AIG and (financial product division) employees continue to successfully execute precisely the job asked of them: to de-risk and unwind the (financial product) business," Pretto said in the e-mail. "To date, they have reduced the trade count from 44,000 to 28,000."


Lawsuit against AIG seeks return of bonuses, perks
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1) A lawsuit filed on behalf of shareholders of American International Group Inc. is demanding company executives return millions of dollars in bonuses, dividends and other perks.
2) The lawsuit, which seeks class-action status, also seeks unspecified damages as well as the removal of AIG's top brass. It claims shareholders have lost $200 billion because of AIG's gross mismanagement and corporate waste over the past 8 1/2 years.
3) Freedom Watch, a nonprofit organization that advocates for ethics in government, filed the lawsuit Thursday in U.S. District Court in Los Angeles.
4) Among the defendants named in the suit are former Chief Executive Officers Maurice Greenberg, Martin Sullivan and Robert Willumstad, as well as current CEO Edward Liddy.
5) AIG spokesman Joe Norton said Friday the company had no immediate comment.
6) The defendants "have seriously undermined and damaged AIG's financial health and valuable past reputation by systematically causing and/or permitting the company to engage in a litany of highly risky, detrimental and reckless business dealings," the lawsuit states.
7) The company also gave misleading and false assessments when it reported earnings in 2006 and 2007, according to the lawsuit.
8) Continuing to pay a dividend and even raising it at one point in mid-2007 shows the defendants were either trying to misrepresent the financial stability of the company or derelict in their management and oversight, the lawsuit states.
9) The filing follows the recent revelation that AIG employees got $165 million in bonuses after AIG received $182.5 billion in government aid.
10) The bonuses were given to employees of the financial products division, a global unit that issued derivatives called credit default swaps, which drove AIG almost to collapse last year.
11) The government intervened to provide support for AIG because of fears that a collapse of New York-based company would trigger hundreds of billions of dollars in losses at financial institutions worldwide, further crippling the already battered credit markets.
12) Larry Klayman, chairman and general counsel of Freedom Watch, said the problems at AIG have "gotten under the skin of the American people."
13) "A lot of information has come to light," Klayman said. "It's an issue the American people want dealt with right now."


Former AIG CEO criticizes successors, bailout
(APW_ENG_20090402.0927)
1) The man who built insurance giant American International Group Inc. from a startup to a global behemoth said he did not mismanage the company -- but the government did.
2) Following weeks of public and congressional outrage over largest corporate failure in U.S. history, Maurice "Hank" Greenberg, AIG's chief executive until March 2005, said taxpayers got a raw deal in the largest bailout of the financial crisis.
3) Testifying before the House Oversight and Government Reform Committee Thursday, Greenberg said his team had "nothing to do" with failures that so far have cost more than $182 billion. But he said the government's actions since taking over the company have left taxpayers with a nearly 80 percent stake "in a steadily diminishing asset" and no good exit strategy.
4) Greenberg, 83, said he never would have made the disastrous decision to sell hundreds of billions of dollars in guarantees for corporate and consumer debt.
5) "When I left the company, it was a healthy company," Greenberg said, citing its strong earnings and share price at the time. He did not discuss liabilities AIG was accumulating on its balance sheet through derivatives and a securities lending business.
6) In essence, AIG lent its triple-A credit rating to other companies for a small charge so they could reinvest money spent on securities backed by mortgages and other debt. When it lost that rating, it was forced to put up billions in collateral.
7) Greenberg blamed his successors for all of New York City-based AIG's problems. He said they recklessly abandoned "comprehensive and conservative" risk management procedures that he and his executive team employed.
8) "AIG's business model did not fail; its management did," Greenberg said. He went on to criticize his successors' handling of the financial products division, which he said "functioned quite well" under his leadership. That division wrote the notorious credit-default swaps that have forced the company to pay about $50 billion to U.S. and foreign banks.
9) Financial products was "an informal kind of joint venture," but it was tied to his risk management policies, Greenberg said. He said the division doubled in size in the nine months after he left. But he accepted no blame for the failure to offset risk on billions of dollars in derivatives the company sold during his 38-year tenure.
10) AIG is so sprawling, and so intertwined with banks and other market players, that its failure could upend the global financial system.
11) Longtime AIG critic Rep. Elijah Cummings, a Maryland Democrat, rejected Greenberg's finger-pointing.
12) "I'm convinced that the systemic problems at AIG go far deeper than mistakes made in the four years since you left the company," Cummings said. "What you failed to mention was that a good portion of those risky (bets) were written" before Greenberg's 2005 departure.
13) Cummings asked multiple times how many of the credit-default swaps were written while Greenberg was in charge.
14) "The amount we wrote was for European banks," Greenberg replied. "As far as I know, there was never a loss on any of that."
15) The swaps are commonly used contracts to insure against the default of financial instruments such as bonds and corporate debt. But they also are bought and sold as bets against bond defaults.
16) Besides forcing AIG's rescue, they played a prominent role in the credit crisis that brought the downfall last year of investment firm Lehman Brothers Holdings and Merrill Lynch & Co. selling itself to Bank of America Corp.
17) Greenberg repeatedly said the company's strong credit rating, which persisted until his departure, meant he had less cause to worry about risk AIG was taking on.
18) Greenberg, who is AIG's largest shareholder, spent the bulk of his testimony alleging flaws in the government's handling of the bailout, which has been restructured four times.
19) "That plan has failed," he said, adding that the company never should have funneled the $50 billion to banks it had deals with, and the government should have focused on keeping the company strong rather than splitting it up.
20) "The goal of government should not be to liquidate large companies that have demonstrated they can succeed if properly managed," Greenberg said. "It should be to restore them so that they can be employers and taxpayers."


Report: AIG may sell US auto unit to Zurich
(APW_ENG_20090416.0761)
1) Insurer American International Group Inc. may announce a deal to sell its car insurance unit to rival Zurich Financial Services AG, according to a report.
2) The sale of 21st Century Insurance is expected Thursday, the Wall Street Journal said, citing people familiar with the matter.
3) The price tag for the auto insurance business could be between $1.5 billion and $2 billion according to the report.
4) The deal could strengthen Zurich's hand in the U.S. auto insurance business. Zurich owns Los Angeles-based insurer Farmers Group Inc.
5) An AIG spokesman declined to comment.
6) New York-based AIG has received $182.5 billion in financial support from the government since September. The company is selling off a number of business units to repay part of the loan.
7) On Thursday, AIG said it completed the sale of its wealth management arm AIG Private Bank Ltd. to Aabar Investments PJSC of Abu Dhabi.
8) Under terms of the agreement, the United Arab Emirates-based investment company paid about $253 million and assumed about $55 million of intra-company loans outstanding to AIG Private Bank.
9) The deal, which was announced in December, is the fourth transaction AIG has closed in the past three weeks and one of 10 asset sale agreements it has reached in the past few months.


AIG completes preferred stock sale to government
(APW_ENG_20090420.0517)
1) American International Group has completed a preferred stock sale to the government as part of a previously announced plan to receive additional financial support, according to a regulatory filing.
2) New York-based AIG says in a Securities and Exchange Commission filing that it sold preferred stock and issued warrants to the government in exchange for $29.84 billion.
3) The additional funding was announced last month when AIG disclosed a fourth-quarter loss of $61.7 billion, the largest ever quarterly corporate loss in U.S. history.
4) As part of the deal, AIG must avoid bankruptcy and the government must remain the majority owner of the insurer.
5) In September, the government rescued AIG amid the mushrooming credit crisis.


Report: AIG close to selling Japan headquarters
(APW_ENG_20090504.0261)
1) Embattled insurer American International Group Inc. is close to selling its Japanese headquarters for around $1 billion to help pay off its debt to Washington, the Wall Street Journal said Monday.
2) The 15-story building will likely be purchased by a Japanese insurance company, though the timing is unclear because of this week's "Golden Week" holidays, the paper said citing unnamed sources. Financial markets are closed through Wednesday.
3) The deal would be among the biggest divestitures New York-based AIG has made to reimburse the U.S. government for its massive infusion of aid, according to the Wall Street Journal.
4) Phone calls to AIG's Japan headquarters went unanswered Monday.
5) Although the building is 35 years old, it sits on prime real estate in central Tokyo, next to the Imperial Palace. AIG's roots in Japan extend back to 1946, and the company is now the country's biggest foreign casualty insurer.
6) The U.S. government provided AIG with an $85 billion loan in September. As market conditions worsened and losses piled up at the insurer, the government revised and expanded its loan package to AIG several times. The package of loans now totals nearly $180 billion after being expanded in March when New York-based AIG reported a fourth-quarter loss of $61.7 billion, the largest ever quarterly corporate loss in U.S. history.
7) As part of the loan package, the government has also taken a roughly 80 percent stake in the insurance giant.
8) AIG may also be nearing a deal to unload its airplane leasing business, International Lease Finance Corp., the Wall Street Journal said.


AIG looks to spin off Asian insurance unit
(APW_ENG_20090518.0428)
1) American International Group is planning to spin off its Asian life insurance unit in an initial public offering as the faltering U.S. company seeks to repay billions in government bailout funding.
2) AIG is taking steps to list American International Assurance Company -- also known as AIA Group -- on an Asian stock exchange in a move that would turn the firm into a separate entity with its own board and management team, AIG said in a statement Sunday.
3) Timing of the listing depends on market conditions and regulatory approval, the company said.
4) AIA is among the region's leading insurers with more than 20 million customers and more than $60 billion in assets.
5) Last week, AIG Chief Executive Ed Liddy told Congress the insurance giant is making progress toward repaying U.S. taxpayers by selling many of its foreign assets, and does not need more bailout money.
6) New York-based AIG has received $182.5 billion in financial support from the government since its near collapse in September threatened the stability of the global financial system and worsened the economic recession.


AIG ' s Liddy to depart; company to split chair, CEO
(APW_ENG_20090521.1316)
1) American International Group Inc. on Thursday said its chairman and chief executive plans to step down when a search for replacements is complete.
2) The company also said its board agreed with a recommendation from Edward M. Liddy, who took over the insurer in September, to separate the chairman and CEO roles.
3) AIG will start a search for permanent leadership after the company's annual shareholder meeting June 30. At that meeting, investors will vote on a slate of six new independent directors.
4) Shareholders will also vote on a company proposal for a reverse stock split of the company's outstanding common stock at a ratio of 1 for 20, according to a regulatory filing.
5) The plan to split the chairman and CEO comes as AIG's corporate governance practices continue to receive intense scrutiny, after it paid out millions in bonuses despite a huge bailout from taxpayers.
6) AIG has received $182.5 billion in financial support from the government since September. As part of the loan package, the government has also taken a roughly 80 percent stake in the huge insurance company.
7) The company said the search for new leadership will include participation by both the reconstituted board and the trustees of the AIG Credit Facility Trust, which was established to represent government interests in the company.
8) Liddy, former CEO of Allstate Corp., was named chairman and chief executive on Sept. 18, in connection with the federal bailout. He succeeded Robert B. Willumstad, who was chairman since November 2006 and held the CEO spot since June.
9) AIG shares closed Thursday trading up 2 cents at $1.80, then lost a penny in aftermarket electronic trading.


AP Source: AIG agrees to sell 2 NYC buildings
(APW_ENG_20090603.0618)
1) The embattled insurer American International Group Inc. is selling its headquarters building in New York and a nearby building in a deal expected to close at the end of this summer, a person familiar with the matter said Wednesday.
2) But the person said that AIG is not disclosing the price or who the buyer is. The person asked for anonymity because the sale has not been made public yet.
3) The building sales are the latest move by AIG, which has received $182.5 billion in financial support from the government since September, to shed assets to repay the loan package.
4) The buildings are at 70 Pine Street and the adjacent 72 Wall Street in lower Manhattan.
5) The person said AIG employees will remain in its headquarters through 2010, and in the Wall Street building through the end of this year. The New York-based company is developing a relocation plan, the person said.
6) AIG is selling assets and spinning off some subsidiaries as it looks to raise new cash to repay government loans while becoming a smaller, more-efficient company. As part of the loan package, the government has also taken a roughly 80 percent stake in the huge insurance company.
7) AIG was devastated not by its traditional insurance operations, but by its financial products business, which underwrote risky credit derivatives contracts known as credit default swaps. The swaps are essentially insurance contracts protecting an investor against default on an underlying investment, such as mortgage-backed securities.
8) Rising defaults in the investments that AIG's contracts were insuring led to worries that the company would not be able to cover all of its obligations and that the ripple effects would touch off a new, even more intense phase of the credit crisis. That's when the government stepped in, fearing that without its help, AIG's collapse would cripple financial markets in the U.S. and around the world.


Jury selected for lawsuit between AIG, Starr
(APW_ENG_20090615.0852)
1) A jury has been selected for a $4.3 billion lawsuit brought by American International Group Inc. against Starr International Co., the private investment firm run by AIG's former CEO.
2) The jury was chosen after U.S. District Judge Jed Rakoff said he will allow speeches by Maurice "Hank" Greenberg, the CEO who was ousted in 2005, to be heard in court as evidence.
3) The embattled insurer is trying to reclaim money from Starr it says was wrongly pocketed through stock sales by Greenberg.


AIG ex-CEO Greenberg returns to witness stand
(APW_ENG_20090617.1126)
1) Former American International Group Inc. CEO Maurice "Hank" Greenberg returned to the witness stand on Wednesday to defend taking over a retirement bonus fund that AIG is trying to recover in federal court.
2) AIG's lawyer Theodore Wells played a video of Greenberg in 2000 telling retirement plan participants that there were "sufficient shares in the trust for a couple hundred of years."
3) "It's a motivating speech," Greenberg told jt shareholder until the government bailed out AIG last year.
4) AIG has received $182 billion in federal aid. AIG says if it can reclaim the $4.3 billion from Starr, the money would help the troubled financial services company repay the government.
5) The complicated lawsuit against Greenberg and Starr involves a fund created during a reorganization of AIG in 1970 with $110 million worth of stock. Its value grew to $4.3 billion over nearly four decades.
6) AIG's lawyers are arguing that Greenberg took control of the fund and then sold tens of millions of the AIG shares held in it because he was angry about losing his job. Starr's lawyers are arguing that the shares rightfully belonged to Starr.
7) In July 2005, Starr's voting shareholders, including Greenberg, decided to restate the purpose of the fund. In a memo Wells presented in court on Wednesday, Starr's shareholders said they rescinded previously stated purposes of the fund, and reaffirmed the fund's "ultimate purpose" as a charitable trust.
8) Wells asked Greenberg on Wednesday if he informed the hundreds of retirement plan participants of the fund's restated purpose.
9) "I don't think we had an obligation to tell them that," Greenberg said.
10) The fund has been described in letters and speeches by Greenberg over the years as a retirement bonus fund for select current and future employees -- a "kind of golden handcuffs" given to members of "the inner club."
11) Starr International Co., also known as SICO, is a Bermuda-based holding company.
12) The fund was "a plan. A plan is not cast in concrete. There had to be certain performance standards," Greenberg said on Tuesday. If those standards were not met, Starr's voting shareholders "had a right to make a change," he said.
13) He also said the fund was "not just for AIG employees," and that it had many other purposes. One was to allow Starr to control AIG, Greenberg said, and after Greenberg lost his job, Starr's voting shareholders "lost control" of AIG, and were then able to reclaim the shares.
14) AIG's lawyer Wells said on Monday that Greenberg took control of the fund and then sold tens of millions of the AIG shares held in it because he was "angry" about losing his job.


Correction: AIG trial story
(APW_ENG_20090622.0742)
1) In a June 18 story about American International Group Inc.'s lawsuit against Starr International, The Associated Press erroneously reported that both sides agreed at a July 2005 meeting to suspend a compensation plan for AIG employees. That meeting took place in May 2005, not July, and was only attended by Starr's voting shareholders.
2) Lawyers for Starr presented minutes from the meeting in court that said an agreement between Starr and AIG had been reached on suspending the plan, but the story should have reflected that AIG disputes that contention.


AIG moves to spin off 2 units, reduce gov ' t debt
(APW_ENG_20090625.0431)
1) American International Group is placing two subsidiaries into special units ahead of planned spinoffs. The move will help the insurer reduce the debt it owes the government by $25 billion.
2) AIG is spinning off two of its international life insurance units, American International Assurance and American Life Insurance.
3) Before the units are spun off through initial public offerings, they will be placed in special purpose vehicles. The government will receive preferred interests in the SPVs, which will be used as repayment of part of AIG's outstanding loan.
4) AIG currently has borrowed about $40 billion from the government.
5) The government rescued New York-based AIG from the brink of collapse last fall as the credit crisis worsened.


AIG annual meeting a short, relatively calm affair
(APW_ENG_20090630.1034)
1) American International Group Inc.'s annual shareholder meeting ended without drama Tuesday after a handful of shareholders voiced disappointment over the embattled insurer's near-collapse last fall.
2) The meeting at the company's headquarters was relatively calm, and there was little outrage over the insurance giant's recent problems, in contrast to shareholder meetings this year for other financial firms that have relied on government support, such as Bank of America Corp. The meeting was also short, lasting less than an hour, well under Citigroup's six-hour gathering and four hours at Bank of America.
3) "I was expecting more of a crowd," said Kenneth Steiner of Great Neck, New York, who was one of about 80 shareholders other than employees in attendance. "With the stock as low as it is, I expected more from shareholders."
4) AIG shareholders have nearly been wiped out since the government provided the company with a lifeline last September at the height of the financial crisis. AIG was done in by underwriting risky financial derivative contracts, not its traditional insurance operations.
5) The government, which ultimately gave AIG a $182.5 billion bailout, now has an 79.9 percent stake in the insurer.
6) CEO Edward Liddy said the government may never relinquish its stake in the insurer.
7) "I can give you no assurances that it will ever change," Liddy said responding to a shareholder's question. He went on to say that a lower percentage of government ownership should increase the company's value.
8) AIG's share price has declined 89 percent since the government first bailed out the New York-based company in September. So far this year it has slid 15 percent.
9) AIG stock was down 16 cents, or 12 percent, at $1.17 in afternoon trading Tuesday.
10) During the meeting, Liddy reviewed AIG's plans to repay the loans it received from the government to help it remain in business.
11) Despite its near-collapse last September, Liddy said the insurer is "more stable than before."
12) "Repaying the government will happen," he said.
13) AIG is in the process of restructuring its business, shedding assets and cutting costs as part of a plan to repay the government.
14) On Tuesday it said it is selling the assets of a Taiwan-based subsidiary, AIG Credit Card Company (Taiwan) Ltd., to Far Eastern International Bank. Terms of the deal were not disclosed.
15) Last week, AIG said it was moving forward with plans to spin off two international life insurance subsidiaries, American International Assurance Co. and American Life Insurance Co.
16) All the company's proposals were approved during the meeting, except for one relating to the number of authorized shares; all shareholder proposals were rejected.
17) AIG had delayed its annual meeting, usually held in May, to give it more time to shuffle its board, which has been almost entirely reconstituted over the last year.


Jury finds against AIG in suit versus Greenberg
(APW_ENG_20090707.1194)
1) American International Group Inc. lost a big round Tuesday in its court battle against former CEO Maurice "Hank" Greenberg.
2) In an advisory decision, a federal jury in Manhattan found that an investment firm controlled by Greenberg did not have to reimburse AIG for $4.3 billion in shares taken from a company retirement bonus fund in 2005, shortly after Greenberg was ousted as the insurer's CEO.
3) U.S. District Judge Jed S. Rakoff said he would issue a ruling in the case by the end of August.
4) "I give considerable weight to an advisory verdict, but in the end, it is something that the court has to determine for itself and I will make my own findings of fact and consultations of law," Rakoff said.
5) The jury deliberated for about half a day before issuing its decision.
6) The New York-based insurance giant had accused Greenberg, through a company called Starr International that he controls, of plundering an AIG retirement program composed of $4.3 billion in stock. The questions raised during the civil trial boiled down to who controlled the fund, and what its purpose was.
7) AIG has received $182.5 billion in federal aid since last fall. The company said it would use any proceeds from the trial to repay some of its loans from the government.
8) The insurer's attorney, Theodore Wells, said only that he was "disappointed in the verdict."
9) Greenberg, who testified during the first week of the trial that began June 15, was not present for the jury's decision.
10) David Boies, Starr International's attorney, said: "I think the quickness of the decision reflects the simplicity of the case. I would be hopeful that the judge would see it the same way the jury does."


AIG sells life insurance premium finance business
(APW_ENG_20090728.0670)
1) Insurer American International Group Inc. said on Tuesday that it closed the sale of its life insurance premium finance business for $679.5 million in cash.
2) AIG sold a majority of the U.S. life insurance premium finance portfolio of AIG Credit Corp. and A.I. Credit Consumer Discount Co. to First Insurance Funding Corp., a subsidiary of Wintrust Financial Corp. of Lake Forest, Illinois.
3) Upon meeting certain conditions, First Insurance Funding will also purchase an additional amount of certain specified life insurance premium finance assets for $61.2 million, AIG said.
4) The property-casualty premium finance business of A.I. Credit was not included in the deal.
5) During the credit crisis last fall, the U.S. government rescued AIG from the brink of collapse with a loan bailout package worth up to $182.5 billion. The government now owns roughly 80 percent of the huge insurer. AIG is now shedding assets and cutting costs as it restructures.
6) Shares of AIG were unchanged at $13 in morning trading, while shares of Wintrust Financial lost 5 cents to $17.33.


AIG announces new chair, reports 2Q results Friday
(APW_ENG_20090806.1407)
1) Amid its ongoing restructuring and management shuffle, American International Group Inc. is about to provide some insight into how much it has recovered since it almost collapsed a year ago.
2) The insurer, which is now 80 percent owned by the U.S. government, reports its second-quarter results Friday. It has been working toward repaying government loans by selling assets and preparing to spin off others. Analysts say progress on those efforts as well as the insurer's ability to retain or attract customers for its insurance units will be the keys to whether the quarter is considered a relative success.
3) The company took another step toward its recovery Thursday, naming former American Express Co. Chairman and CEO Harvey Golub as its non-executive chairman, replacing retiring Edward M. Liddy. Golub, 70, was elected to the AIG board in May. He headed American Express from 1993 to 2001.
4) Golub's appointment was announced three days after AIG said former MetLife Inc. Chairman and CEO Robert Benmosche will take over as president and CEO from Liddy.
5) If AIG's recent share price surge is any indication, investors are becoming more optimistic that the company is finally beginning to find its footing. AIG jumped 53 cents, or 2.4 percent, to $22.53 after rising more than 60 percent on Wednesday.
6) Analysts, however, aren't about to get ahead of themselves.
7) "Things are getting better, it's just hard to know from what stance," said Bill Bergman, senior stock analyst at Morningstar Inc. in Chicago.
8) Standard & Poor's equity analyst Cathy Seifert said some of the share price gains could be from investors trying to cover short sales in case results are somewhat upbeat. A short sale is when an investor borrows a share of stock, sells it and then tries to buy it back at a lower price to make a profit.
9) The government provided AIG with an $85 billion rescue package amid the growing credit crisis last fall. Since then, the government has provided additional rounds of support. AIG's available loan package now totals $182.5 billion, though it has not tapped all the funds.
10) Liddy's departure was first announced in May and at the time it was also announced the CEO and chairman roles would be split, similar to what many financial firms have done over the past year. The former CEO of Allstate Corp., Liddy has served as chairman and CEO of AIG since the government rescued the insurer in September.
11) Golub and Benmosche will be stepping into a company in an unprecedented state of flux. AIG is trying to shed assets, spin off subsidiaries and raise money to help repay the government.
12) AIG is planning to spin off at least three of its major subsidiaries -- its property casualty and general insurance business as well as two life insurance units. The government is receiving preferred stakes in each of the life insurance units as part of AIG's loan repayment.
13) Although AIG could retain majority stakes in each of the spinoffs, separating the units allows them to create different management teams to operate the firms.
14) The spinoffs allow AIG to separate the still-performing businesses from a parent company whose brand is likely hindering business.
15) "It's very important that these companies are able to insulate themselves from AIG's taint," S&P's Seifert said. "It's the only way to hold onto franchise value."
16) Aside from the spinoffs, AIG has sold dozens of assets since December as part of its cash-raising efforts.
17) AIG's near-failure was not because of its basic insurance operations that it is now shedding, but instead by its foray into risky derivatives and other investments that helped cause the credit crisis.
18) Losses in the financial products division that wrote those contracts have likely continued to pile up. One of the problems still facing AIG is uncertainty surrounding that unit.
19) "It's so hard to know what those losses were in the first place," Morningstar's Bergman said. "We don't know the extent of the losses that are still there on the derivitatives books."


AIG reports 2Q profit, first since 2007
(APW_ENG_20090807.0552)
1) American International Group Inc. is reporting its first quarterly profit since 2007, as the company saw stability in some of its businesses.
2) The troubled insurer says it made $1.82 billion during the second quarter, which ended June 30. Of that, $311 million, or $2.30 per share, was attributable to common shareholders because the government owns 80 percent of the company after bailing it out last year.
3) AIG now has a loan package worth up to $182.5 billion.
4) For the year-ago second quarter, AIG lost $5.4 billion, or $41.13 per share.
5) AIG has been aiming to spin off some of its assets to begin to repay the government money. It says it expects proceeds of about $8 billion from sales so far this year, giving it about $4.6 billion to begin to repay debts including what it owes the government.


AIG reaches deal to sell Indian IT unit to MphasiS
(APW_ENG_20090812.1275)
1) American International Group reached a deal to sell another unit on Wednesday.
2) The battered insurance giant will sell its AIG Systems Solutions Pvt. Ltd., an India-based company that provides information technology services to AIG companies around the world, to MphasiS, of Chennai, India.
3) MphasiS, a unit of Hewlett Packard's Electronic Data Systems, said about 39 percent of its revenue comes from financial services and insurance companies.
4) Terms of the deal were not disclosed. AIG Systems Solutions is based in Chennai and Kolkata and has about 800 employees.
5) The agreement was announced on the same day AIG said it will sell its Hong Kong finance business to a Chinese bank for $70 million in cash and $557 million in debt, and a day after the company said its financial products unit completed the sale of its energy and infrastructure investment assets.
6) AIG has been selling off parts of the company in an effort to raise money to pay back the U.S. government. The insurer received a loan bailout package worth up to $182.5 billion. The government now owns roughly 80 percent of the huge insurer.
7) AIG shares closed up 41 cents at $25.33.


New AIG CEO says expects to repay gov ' t: report
(APW_ENG_20090820.0770)
1) Shares of American International Group Inc. skyrocketed Thursday after the company's new CEO was quoted by Bloomberg News as saying the company will repay its debts to the government.
2) New York-based AIG named Robert Benmosche its new CEO earlier this month. He had previously been CEO of MetLife Inc., the largest U.S. life insurer.
3) An AIG spokeswoman declined to comment on the report.
4) Shares of AIG jumped $7.02, or 26.4 percent, to $33.66 in late morning trading.
5) When the credit crisis hit last year, the U.S. government rescued AIG from the brink of collapse with a loan bailout package worth up to $182.5 billion. The government now owns roughly 80 percent of the huge insurer. AIG is shedding assets and cutting costs as it restructures.


Federal judge dismisses lawsuit against AIG
(APW_ENG_20090821.1247)
1) A federal judge has thrown out one lawsuit against American International Group Inc. alleging it defrauded about 600 workers compensation insurance companies but another case, which is seeking class-action status, will move forward.
2) The dismissed case was filed by the National Council On Compensation Insurance Inc. on behalf of about 600 insurance companies that are members of the National Workers Compensation Reinsurance Pool.
3) In an order filed Thursday in the Northern District of Illinois, Judge Robert W. Gettleman dismissed the case, saying the NCCI lacked standing to sue AIG.
4) He noted that the dismissal doesn't mean the end of the litigation.
5) Safeco Insurance Co. of America filed a lawsuit on April 14, which was reassigned to Gettleman because it is related to the NCCI case.
6) "The court will examine the viability of proceeding as a class action in due course," he wrote.
7) He ordered the parties to appear on Sept. 4 for a hearing on the Safeco case and other matters involving the litigation against New York-based AIG.
8) AIG spokeswoman Christina Pretto said Friday the company is pleased Gettleman dismissed the NCCI's case and plans to fight Safeco's class-action complaint, saying it's "deficient for several reasons, and AIG intends to seek dismissal of that case at the appropriate time."
9) AIG also has filed a counter lawsuit against several insurance companies claiming they too engaged in similar activities of underreporting workers compensation premiums and "AIG will continue to pursue those claims vigorously," she said.
10) A spokesman for NCCI said the case is far from over.
11) "These claims will continue to be prosecuted as a class action or in another form to remedy AIG's admitted wrongdoing, to obtain a full and fair accounting by AIG, and to pursue all other available remedies," said Pete Wentz.
12) The roots of the dismissed case go as far back as 2005 when New York officials concluded that AIG had, over several decades, provided false reports of its workers compensation premiums to the NCCI and state tax authorities.
13) AIG issued a formal report detailing its unlawful conduct and acknowledged the unreported workers compensation premiums totaled between $300 million and $400 million annually, which gave AIG an unlawful benefit in the range of $60 million to $80 million or more a year.
14) The report admitted that AIG's reporting practices were unlawful and exposed it to civil liability and potential criminal prosecution.
15) AIG entered into settlement agreements in 2006 with several enforcement authorities, including a $1.6 billion settlement with New York and federal authorities.
16) The NCCI claimed that total damages to its member companies exceeded $1 billion and it sought fair compensation in the lawsuit, which it claimed the settlement did not accomplish.
17) The judge ruled the NCCI lacked legal standing to seek damages on behalf of the insurance companies.
18) Shares of AIG rose 85 cents, or 2.6 percent, to $33.15 in afternoon trading.


AIG shares surge on word of talks with Greenberg
(APW_ENG_20090827.1139)
1) Shares of American International Group Inc. surged Thursday as analysts speculated the company might be reconciling with former CEO Maurice "Hank" Greenberg, who could help bring private capital and other business benefits to the company.
2) Shares of AIG continued to climb in after-hours trading and last traded at $48.30. It finished the regular session at $47.84, up $10.15, or 27 percent. The shares have traded between $6.60 and $493.60 in the past year. AIG completed a 1-for-20 reverse stock split on July 1.
3) More than 148 million shares changed hands, nearly seven times the 3-month average volume of 22.3 million shares.
4) Investor interest was fueled by the news that the company may be working to mend the strained relationship with Greenberg, who was forced out of the company in 2005 after an accounting scandal surfaced.
5) "It's not just that they're shaking hands with Greenberg, there's a real financial value in doing that," said Bill Bergman, senior stock analyst for Morningstar Inc. "Given the fact that AIG would have access to capital and business opportunities could be had, the reconciliation is meaningful."
6) A company spokeswoman did not immediately return a call seeking comment.
7) Early this month Greenberg agreed to pay a $15 million fine to settle fraud charges that alleged the company had engaged in deceptive accounting practices.
8) A statement released on his behalf said it was appropriate to put the matter behind him.
9) Greenberg, who built AIG over his 35-year career from a small company into the world's largest insurer, has been fighting AIG in court in an unrelated case over who controls an employee retirement fund.
10) A resolution in that case is expected by month's end with a judge's decision.
11) AIG was hit hard by the collapse of the home mortgage business. The insurance company had divisions that originated mortgages, insured them and was heavily invested in mortgaged backed securities and other instruments tied to mortgages, Bergman said.
12) The credit crisis sent AIG reeling and the U.S. government rescued the company from the brink of collapse with a loan bailout package worth up to $182.5 billion. The government now owns roughly 80 percent of the company.
13) AIG is shedding assets and cutting costs as it restructures.
14) Signs of improvement in the housing market generally in the past few months are positive for the company, Bergman said.
15) The stock was mostly flat in July, trading below $15 a share, but has surged upward this month nearly tripling in value.


AIG selling asset management unit for $500 million
(APW_ENG_20090905.0558)
1) American International Group Inc. said Saturday it reached a deal to sell a portion of its asset management business to a Hong Kong-based investment firm for $500 million.
2) The sale to Bridge Partners LP, which is owned by Pacific Century Group, includes about $300 million in cash at closing, additional future consideration that includes a performance note and a continuing share of carried interest.
3) The sale is just the latest for the troubled insurance giant.
4) AIG is trying to sell assets to repay billions of dollars in federal loans. The loan package, which helped the company avoid failing, was worth up to $182.5 billion.
5) The latest units being sold operate in 32 countries and manage about $88.7 billion of investments by institutional and retail clients, AIG said in a release.
6) AIG will retain its in-house investment arm that oversees about $480 billion of assets under management.
7) Win J. Neuger will continue as CEO of the units being sold and the existing management team will remain in place, the company said.
8) The transaction is subject to receipt of regulatory approvals.
9) Shares of AIG fell $1.70, or 4 percent, to $40.05 Friday, then fell another 32 cents to $39.73 in after-hours trading.


AIG shares jump after talk of bailout revamp
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1) Shares of American International Group Inc. jumped more than 20 percent Monday after the head of the House Committee on Oversight and Government Reform said that panel will examine a plan to reduce the company's massive bailout package.
2) The stock surge occurred despite a report from congressional investigators that cast doubt on whether efforts by AIG to restructure its operations and fully repay the government the billions it received will ever prove successful.
3) Rep. Edolphus Towns, chairman of the House committee, will have that panel study a plan by AIG's former CEO Maurice "Hank" Greenberg to reduce and restructure the company's bailout package, a committee spokeswoman said Monday.
4) Towns, who has not spoken to the Treasury Department about the plan, met with Greenberg last week, the spokeswoman said.
5) Greenberg was ousted as CEO in 2005 amid an accounting scandal. He still holds millions of shares of AIG stock through a privately held investment company called CV Starr & Co.
6) Standard & Poor's equity analyst Catherine Seifert upgraded her rating on AIG's stock to "Hold" from "Sell" Monday, saying Towns' review of Greenberg's plan should boost the insurer's stock price in the near term.
7) Seifert raised her price target on the stock to $45 from $30.
8) AIG shares have been extremely volatile in recent months as investors bet on whether the New York-based company will be able to pay off its government debts and fully recover from the economic downturn. Its shares jumped $8.49, or 21.3 percent, to $48.40 Monday.
9) In a taxpayer-funded bailout, the Federal Reserve and Treasury Department have provided $182.3 billion to the insurance giant. The Government Accountability Office said that as of early September, AIG's outstanding balance of aid was $120.7 billion.
10) The GAO, in a report released Monday, found "some progress in AIG's ability to repay the federal assistance." But improvement in the company's stability depends on its long-term health, market conditions and continued government support.
11) The report concluded that "the ultimate success of AIG's restructuring and repayment efforts remains uncertain."
12) Responding to the report, AIG spokesman Mark Herr said: "AIG remains committed to reducing risk and repaying taxpayers."
13) Fearing that AIG's collapse could take down the entire U.S. financial system and the broader economy, the Fed first came to AIG's rescue last September.
14) The original $85 billion aid package came one day after Lehman Brothers filed for bankruptcy, the largest in U.S. corporate history. AIG burned through the first lifeline, though, and continued to hemorrhage cash. It needed help three more times from the government, which owns about 80 percent of the company because of the bailout.
15) Congressional investigators acknowledged that the federal assistance has "helped stabilize AIG's financial situation." But they said the government remains exposed credit and investment risks that "could result in the Federal Reserve and Treasury not being repaid in full."


Treasury said to be unprepared on AIG bonus plans
(APW_ENG_20091014.0155)
1) The pitched drama over bonuses for bailed-out executives will be revived on Capitol Hill Wednesday as a government watchdog explains how some executives nearly brought down the financial system -- then pocketed millions.
2) Neil Barofsky, the special inspector general for the $700 billion financial rescue program, will answer questions about a new report outlining the official missteps that led to massive bonus payments for executives at insurer American International Group Inc.
3) In a report released Tuesday, Barofsky wrote that the Treasury Department did not understand AIG's byzantine pay structures when it gave the firm billions in aid last fall. The government has committed a total of more than $180 billion to wind down the New York-based insurance and financial services conglomerate, and now owns about 80 percent of the company.
4) AIG's bonuses sparked a political firestorm earlier this year when it was revealed that the government could not legally stop AIG from paying millions in bonuses even after taking billions in bailout money.
5) Barofsky's appearance is expected to recall testimony in March by Treasury Secretary Timothy Geithner, who was president of the Federal Reserve Bank of New York when AIG first was bailed out. The Federal Reserve provided AIG's first lifeline.
6) Geithner said at the time he had not known about nearly $1.75 billion in bonuses, retention payments and deferred compensation that AIG was contractually obligated to pay its workers. Millions went to employees in the unit whose bets helped sink the company.
7) Barofsky found no evidence that Geithner knew about the payments before March. But he wrote that it was a "failure of communication" for the top executive of the agencies overseeing AIG to be unaware of the payments.
8) AIG has asked employees to return some of the money voluntarily.
9) The report also said the Obama administration's pay czar has asked American International Group to withhold some of the millions in bonuses promised to its employees. Kenneth Feinberg, the special master for executive compensation, "has informally advised AIG not to pay the full $198 million" employees expect to receive, the report said.
10) Feinberg is locked in negotiations with the seven companies that received the most expensive taxpayer bailouts. AIG's was by far the largest. To secure its bailouts, AIG argued to Treasury that its failure would doom the broader financial system.
11) It took officials from the Federal Reserve Bank of New York months to untangle AIG's "staggeringly complex, decentralized" compensation structure, the report says. They eventually discovered 620 bonus programs totaling $455 million, and 13 retention plans allocating $1 billion.
12) The company is talking to Feinberg about matters "including future payments to employees of AIG Financial Products," spokeswoman Christina Pretto said in a statement. Employees have until the end of the year to return voluntarily some of the bonus pay they received in March, she added.
13) Barofsky's report recommends that Treasury work closely with officials from the New York Fed, which is funding parts of the AIG bailout. It also suggests Treasury improve oversight of companies that it owns, including reviewing compensation programs before buying major ownership stakes in companies.
14) In a written response, Herbert M. Allison Jr., Treasury's assistant secretary in charge of the government bailout, said the department is implementing the guidelines and "has no present intention" of buying another financial company.
15) "We welcome your comments and suggestions as Treasury continues to strengthen oversight of financial institutions" receiving government assistance, Allison wrote.


AIG shares slide; report speculates on brain drain
(APW_ENG_20091027.0963)
1) Shares of American International Group Inc. fell Tuesday as the company continues to face challenges in repaying government funds.
2) The insurer's recent loss of executives to the company of former CEO Maurice "Hank" Greenberg may further complicate its efforts to pay back more than $180 billion, a report published in The New York Times said Tuesday.
3) Shares of AIG fell $1.65, or 4.6 percent, to $34.60 in afternoon trading.
4) Pay restrictions imposed last week by the Treasury Department could hasten defections to Greenberg's company, C.V.. Starr & Co., a potential competitor operating under no such restrictions, the Times report said.
5) Treasury "pay czar" Kenneth Feinberg announced he had ordered seven companies that have received billions of dollars in taxpayer money, to slash the base salaries of their top executives by an average of 90 percent and cut total compensation -- cash, stock and perks -- in half.
6) That applies to the five top executives and the next 20 highest-paid employees at AIG, which is based in New York.
7) Analysts have questioned if the companies facing such pay restrictions could lose the top talent needed to help them regain solid footing.
8) Treasury spokesman Andrew Williams said in a statement: "We're acutely aware of this possibility and that's why Ken Feinberg spent hours and hours at AIG trying to understand that specific dynamic and strike the right balance with his determination."
9) A representative from AIG declined to comment on the matter. A spokeswoman from C.V. Starr was not immediately available.
10) Greenberg served as AIG's chief executive from 1967 until he retired in March 2005 amid an accounting scandal. He is chairman and CEO of C.V. Starr & Co., an independently owned holding company with insurance agencies and a portfolio of global investments.
11) AIG was rescued nearly a year ago by the government with an initial package worth $85 billion. It then steadily increased the aid available to AIG to more than $180 billion as market conditions continued to worsen.
12) AIG was devastated not by its traditional insurance operations, but by its financial products business, which underwrote risky insurance contracts on investments tied to mortgages and other souring debt.
13) The insurance giant is 80 percent owned by the government and trying to shed assets and spin off divisions in an effort to pay back the massive government bailout. AIG has been slow to sell assets as it tries to get the best return for its still-performing insurance subsidiaries around the world.


Report: AIG scraps plans to sell Japanese units
(APW_ENG_20091031.0644)
1) American International Group Inc. has dropped plans to sell two Japanese subsidiaries, according to a published report, deciding the company will derive more value from holding on to them.
2) The struggling insurer announced a year ago it would sell three of its Japanese life insurance businesses to help pay off an $85 billion government loan that helped keep it from collapsing as the credit crisis deepened.
3) But with the company's financial picture improving and few viable buyers coming forward, AIG says it will hold on to AIG Star Life Insurance Co. and AIG Edison Life Insurance Co., according to a report posted on The Wall Street Journal's Web site Saturday.
4) AIG is still considering a sale or a spinoff of a third subsidiary, Alico Japan.
5) "I have come to believe that we can obtain the greatest value for AIG Star and AIG Edison by continuing to operate and grow these companies as part of AIG," CEO Robert Benmosche told the Journal.
6) The company signaled in August that it would not rush into sales, revealing in a securities filing that it intends to "maximize the value of its businesses over a longer time frame." That came as AIG was reporting its first quarterly profit since 2007.
7) Separately, The New York Times reported that an AIG policyholder in California has asked a judge for an injunction that would bar the company from moving assets there out of the state, potentially disrupting AIG investments elsewhere.
8) The policyholder, Linda M. Harris, is also a financial planner who had recommended AIG annuities to clients before the company's financial woes came to light last year, the Times reported.
9) In a filing Friday in California Superior Court for the County of Los Angeles, Harris said AIG "continues to engage in unlawful, fraudulent and unfair business practices."
10) The Times reported that AIG spokesman Mark Herr said, "We believe that there is no merit to the motion, and we will continue to defend ourselves against these spurious assertions."


AIG posts 2nd consecutive quarterly profit
(APW_ENG_20091106.0550)
1) AIG said Friday it was profitable for the second straight quarter as its core insurance operations continue to stabilize after the company's bailout by the government last year.
2) American International Group Inc.'s also got a lift from the increasing value of investments it still holds that soured last year and helped drive it to the brink of collapse.
3) Despite the improved performance, AIG CEO Robert Benmosche warned earnings will remain choppy as the company executes its restructuring plan.
4) "We continue to focus on stabilizing and strengthening our businesses, but expect continued volatility in reported results in the coming quarters, due in part to charges related to ongoing restructuring activities," Benmosche said in a statement.
5) Investors' initial reaction to the report is negative. Shares of AIG fell $2.83, or 7.2 percent, to $36.45 in premarket trading.
6) AIG was bailed out in September 2008 by the government as the financial crisis spiraled out of control. The insurer has received aid packages with a total value of more than $182 billion from the government. In return for that financial support, the government received an 80 percent stake in AIG.
7) AIG has been working for the past year to sell assets and streamline operations in an effort to repay the government debt.
8) Net income available to common shareholders was $92 million, or 68 cents per share, in the three months ended Sept. 30 compared with a loss of $24.47 billion, or $181.02 per share, during the same quarter last year -- the quarter when it was initially bailed out.
9) Including the government's portion of the profit, AIG earned $455 million during the latest quarter.
10) Analysts polled by Thomson Reuters, on average, forecast earnings of $1.98 per share for the quarter. Analysts estimates do not always include all charges a company might take throughout the quarter.


Watchdog: Gov ' t overpaid to bail out AIG
(APW_ENG_20091117.0015)
1) Officials managing the multibillion dollar bailout of insurance giant American International Group Inc. bungled the first rescue and may have overpaid other banks to wind down AIG's business relationships, a government watchdog says.
2) The Federal Reserve Bank of New York -- headed at the time by now Treasury Secretary Timothy Geithner -- paid AIG's business partners face value for securities so they would cancel insurance-like contracts AIG had written and ease the firm's liquidity crunch. But at least one of those partner banks would have canceled the contracts for less, according to a report Tuesday from Neil Barofsky, the Special Inspector General for the $700 billion financial bailout Congress approved last October.
3) The report says New York Fed officials mismanaged the negotiations with other banks, removing the threat that AIG would go bankrupt and bowing to a demand from French regulators that French banks holding AIG's debt insurance be paid in full.
4) The initial bailout "was done with almost no independent consideration of the terms of the transaction or the impact that those terms might have on the future of AIG," the report says.
5) As a result, billions more than necessary went to U.S. banks including Goldman Sachs Group Inc.; Merrill Lynch, now part of Bank of America Corp.; and Wachovia, now part of Wells Fargo & Co.; and European banks including Societe Generale, Deutsche Banke, UBS and Calyon, it says.
6) Barofsky also faults the Federal Reserve for refusing at first to reveal which banks had received billions of American taxpayer dollars supposedly intended to save AIG. The Fed released the banks' names and the amount of their payoffs only after lawmakers demanded greater transparency.
7) In its written response, the Treasury Department emphasized that the events "developed extremely quickly" and that officials did not intend to provide further assistance to AIG after an initial $85 billion bailout that the report says tied their hands. But AIG's total bailout package eventually amounted to more than $180 billion.
8) "This report overlooks the central lesson learned from the" AIG rescue, Treasury spokeswoman Meg Reilly said in a statement. "The lesson is that the federal government needs better tools to deal with the impending failure of a large institution" in times of crisis.
9) She said the Obama administration's proposed overhaul of financial regulation would accomplish that goal.


AIG approves $7M pay package for CEO Benmosche
(APW_ENG_20091124.1285)
1) American International Group has approved a pay package for its new CEO Robert Benmosche of $7 million in cash and stock.
2) Benmosche, who took over as CEO of the embattled insurer three months ago, will receive an annual salary of $3 million in cash and $4 million in AIG common stock.
3) AIG is under close government scrutiny after receiving a bailout package worth up to $182.5 billion from the government in exchange for an 80 percent stake in the company. That bailout package also includes restrictions on compensation for the insurer's 100 highest-paid employees.
4) Benmosche told AIG employees in a letter earlier this month that while he was frustrated by the regulatory oversight he was committed to staying on at AIG.


AIG cuts salaries to 3 top executives
(APW_ENG_20091126.0034)
1) Insurer American International Group Inc. said it has cut the salaries of three top executives to comply with pay restrictions for companies that took federal bailout money, according to a regulatory filing Wednesday.
2) The government has provided AIG with a bailout package worth up to $182.5 billion in exchange for an 80 percent stake in the company. The package includes restrictions on compensation for the insurer's 100 highest-paid employees.
3) AIG said it would now pay Chief Financial Officer David Herzog a $350,000 annual salary, pro-rated for the period from Nov. 1 to Dec. 31. That's down from the $675,000 annual salary he earned in 2008.
4) He will also get $3.1 million in stock and is also eligible to receive $833,333 in restricted stock if he meets certain performance goals.
5) None of the three executives were given stock grants in 2008, according to a June filing with the Securities and Exchange Commission.
6) Kristian P. Moor -- who was named CEO of the company's spun-off property casualty and general insurance business Chartis in July -- will be paid $450,000 in annual salary pro-rated for Nov. 1 to Dec. 31. That is down from the $959,615 in salary he earned in 2008.
7) Moor will also get $4.7 million in stock and potentially another $2 million in performance-based restricted stock.
8) Win J. Neuger, chief executive of AIG Investments, will receive $425,000 in annual salary pro-rated for the period. In 2008, as AIG's chief investment officer -- a position he relinquished in January of this year -- he was paid a $1 million salary. Neuger is ineligible for stock awards because he will leave AIG after the sale of its asset-management business.
9) AIG also said it had suspended accruals to a supplemental retirement plan and other nonqualified deferred compensation plans for the three executives.
10) On Tuesday, AIG said it would go ahead with a previously announced pay package for its new CEO Robert Benmosche of $7 million in cash and stock. Benmosche, who took over as CEO of the embattled insurer three months ago, will receive an annual salary of $3 million in cash and $4 million in AIG common stock under the pay agreement.
11) AIG shares rose 16 cents to $34.84 in after-hours trading Wednesday after closing at $34.68, down 32 cents from a day earlier.


AIG shares fall amid reports of reserve shortfall
(APW_ENG_20091130.1051)
1) Shares of American International Group Inc. tumbled nearly 15 percent Monday after an analyst stirred concerns that the troubled insurer doesn't have enough reserves to pay some potential claims.
2) AIG shares dropped $4.90, or 14.7 percent, to finish at $28.40 -- their lowest close since August 19. The shares have more than quadrupled from a low of $6.60 in March.
3) Sanford Bernstein analyst Todd Bault said AIG is facing an $11 billion shortfall to cover potential claims in its property and casualty insurance business, according to media reports Monday. Bault declined to share the research note.
4) Covering that shortfall could cause problems for the New York-based insurer as it tries to repay a government bailout package it received to help stay in business.
5) Separately, the Financial Times reported AIG may soon get a bid for a part of its aircraft leasing unit from a group that includes the head of that business.
6) A spokeswoman for AIG, which is based in New York, declined to comment on either report.
7) AIG is trying to sell assets and raise capital to help repay the government, which bailed it out last year with a loan package worth more than $180 billion. In return, the government received an 80 percent stake in AIG. As of Sept. 30, AIG owed the government about $85.66 billion in loans as part of the broader bailout package.
8) The Financial Times said AIG could be a step closer to selling a portion of the aircraft leasing business, International Lease Finance Corp., to a group of private investors and the unit's chief executive, Steven Udvar-Hazy. The sale of a piece of ILFC, among AIG's profitable units, could help relieve some of its debt burden.
9) AIG's aircraft leasing unit generated operating income of $365 million during the third quarter, a 19 percent jump from the same quarter a year earlier and a 9 percent increase from the previous quarter.
10) The prospective buyers would acquire about half of ILFC's business, which buys airplanes and then leases them to major airlines, for more than $2 billion, according to the Financial Times.
11) AIG has posted two straight quarters of profits as credit and stock markets improved in recent months. Including the government's portion of the profit, AIG earned $455 million during its most recent quarter.


AIG sells Canadian mortgage insurance unit
(APW_ENG_20100105.0788)
1) The Canadian mortgage insurance business of American International Group Inc. will be sold to a private investor group headed by the Ontario Teachers' Pension Plan, the groups said Tuesday.
2) Terms of the transaction were not disclosed.
3) AIG's sale of the Canadian mortgage division is the latest business unit to be sold by the insurance giant, which has been selling assets and spinning off divisions in an effort to help repay a government bailout package received last year when it was on the brink of collapse.
4) AIG United Guaranty Mortgage Insurance Company Canada, based in Toronto, is a leading mortgage provider in Canada with assets of about $264 million.
5) Teachers' Private Capital is the private investment department of the Ontario Teachers' Pension Plan, the largest single-profession pension plan in Canada. It is an independent corporation responsible for investing the fund's assets and administering the pensions of Ontario's 284,000 active and retired teachers.
6) AIG, based in New York, was bailed out by the government last fall at the peak of the credit crisis. As losses continued to pile up, the government eventually extended AIG an aid package worth more than $180 billion. The government received a stake of almost 80 percent in AIG in return for the support.
7) Just last month AIG said it would slash the amount of money it owes the government by $25 billion when it gives the government preferred equity stakes in two of its life insurance companies, American International Assurance Co. and American Life Insurance Co.
8) The companies will be placed into special holding units as AIG decides whether to complete initial public offerings or sell them privately.
9) As of Sept. 30, AIG had tapped $122.31 billion of the aid package and owed the government $85.66 billion in loans. The separation of AIA and Alico would reduce the outstanding aid package to $97.31 billion and the amount owed in loans to $60.66 billion.
10) Shares of AIG fell 34 cents to $29.55 in afternoon trading in New York.


Bernanke asks for AIG ' s bailout review
(APW_ENG_20100119.1129)
1) Federal Reserve Chairman Ben Bernanke took the unusual step Tuesday of asking Congress' investigative arm to conduct a "full review" of the Fed's role in bailing out insurance giant American International Group.
2) The Fed chief's move is aimed at defusing criticism of the government's $182 billion rescue. The bailout sparked public outrage and demands in Congress for more information, especially after it was revealed that millions in bonuses would go to employees in the AIG division that was most responsible for the company's need for a bailout.
3) The House Committee on Oversight and Government Reform has a probe under way that seeks to provide a fuller picture of the AIG bailout. Those lawmakers are especially interested in details involving AIG's payments to Goldman Sachs and other Wall Street firms that did business with AIG. Some lawmakers wonder why the firms were fully paid and why concessions weren't demanded.
4) "To provide a comprehensive response to questions that have been raised by members of Congress, the Federal Reserve would welcome a full review by GAO of all aspects of our involvement" in the AIG bailout," Bernanke wrote in a letter to the Government Accountability Office, the investigative arm of Congress.
5) Bernanke said the Fed already has provided information to Congress on the AIG rescue, has made "a large amount" of information available to the public and provided information to other oversight bodies such as the Special Inspector General for the Trouble Asset Relief Program.
6) Congress passed a law last year giving the GAO authority to review Fed documents in the AIG bailout.


Gen Re paying $92.2M to settle charges
(APW_ENG_20100120.1207)
1) The insurer General Re Corp. has agreed to pay $92.2 million to settle charges by federal authorities' and shareholder claims over its alleged role in accounting misconduct schemes by American International Group and Prudential Financial.
2) The Securities and Exchange Commission and the Justice Department announced the settlements Wednesday with Gen Re, which is part of Berkshire Hathaway Inc., the company led by billionaire investor Warren Buffett.
3) Gen Re, based in Stamford, Connecticut, is paying $19.5 million in a non-prosecution agreement with the Justice Department regarding its criminal probe of Gen Re's transactions with AIG.
4) Under that accord, Gen Re acknowledged that its senior managers engaged in a scheme from 2000-2004 to falsely inflate AIG's reported loss reserves, a key indicator of financial health, the department said. It said the fraud was conducted through the use of two sham insurance transactions between subsidiaries of AIG and General Re in response to analysts' criticism of a $59 million decline in AIG's loss reserves for the third quarter of 2000.
5) The SEC said Gen Re is paying $12.2 million to settle the agency's civil charges over AIG and Prudential. The SEC had said that Gen Re engaged in sham transactions with AIG and Prudential that enabled those companies to "manipulate and falsify" their financial results about 10 years ago.
6) In addition, Gen Re will pay $60.5 million to resolve a class-action lawsuit by AIG shareholders, the SEC said.
7) Insurance conglomerate AIG nearly collapsed in the fall of 2008 at the height of the financial crisis and received about $180 billion in bailout aid from the government. In connection with its accounting scandal, the New York-based company has paid $1.6 billion to settle a range of actions brought by regulators including the SEC, the Justice Department and New York state's attorney general.
8) The scandal at AIG also brought the ouster in 2005 of then-chairman Maurice "Hank" Greenberg.
9) In early 2008, four former executives of Gen Re and AIG's vice president of reinsurance stood trial on charges of conspiracy, securities fraud, making false statements to the SEC and mail fraud stemming from the accounting scandal. They were later found guilty of all charges and sentenced to prison.


AIG discloses details on toxic securities
(APW_ENG_20100129.1414)
1) American International Group Inc. on Friday disclosed details of the toxic securities that helped trigger a massive taxpayer rescue of the giant insurer.
2) In a public filing, AIG listed the securities held in its Maiden Lane III business, which the company and the government created to purchase toxic assets, repay debt and provide capital for some of AIG's operations after its $182.5 billion federal bailout.
3) The Federal Reserve had previously resisted disclosing details on the securities. It argued that doing so could disrupt the market for those assets, possibly making it harder to sell or unwind them.
4) But AIG disclosed the details in a Securities and Exchange Commission filing Friday, two days after Rep. Darrell Issa released the same information to the media as part of a congressional probe into the AIG bailout. Issa is the top Republican on the House Committee on Oversight and Government Reform.
5) AIG didn't immediately returns calls requesting comment.
6) AIG's filing, called a "Schedule A," includes a table listing dozens of collateralized debt obligations, or CDOs, bought from various AIG counterparties including Goldman Sachs Group Inc., Deutsche Bank, Societe Generale, UBS and Merrill Lynch. The filing says the securities were valued at $62.1 billion as of October 2008. By that time, the securities had fallen sharply in value.
7) AIG's Maiden Lane business began buying the CDOs in 2008 in an effort to reduce its exposure to insurance-like contracts, called credit default swaps, written to cover defaults on the CDOs.
8) CDOs are securities backed by pools of mortgages or other assets. They plummeted in value after the credit crisis erupted in 2008 as investors fled all but the safest forms of debt. Credit default swaps are essentially contracts that insure against the default of bonds and corporate debt such as CDOs. Sellers of swaps, such as AIG, are obligated to repay customers if the value of the underlying bonds or debt declines.
9) As Maiden Lane receives cash from the CDOs, the money is first used to repay the government's portion of the loan. Once that is repaid, AIG's funding for Maiden Lane will be repaid. Any additional money made on ownership of the CDOs will be split between the government and AIG, with the government receiving two-thirds of the excess capital and AIG receiving the rest.


Reports: AIG to pay out $100 million in bonuses
(APW_ENG_20100203.0187)
1) American International Group Inc. is set to pay out about $100 million in a fresh round of bonuses to employees of its financial products division, the unit whose risky bets helped sink the company leading to a $180 billion government bailout, according to reports published Tuesday.
2) AIG agreed to cut the retention bonuses by $20 million but will still hand out $100 million Wednesday, The New York Times reported, citing people with knowledge of the negotiations.
3) The Washington Post, also citing people familiar with the situation, said the retention payments are for employees at the division who agreed to accept 10 to 20 percent less than AIG had initially promised them two years ago. In return, they are getting their money more than a month ahead of schedule.
4) AIG is still due to pay out tens of millions of dollars more in March, mostly to former employees who did not agree to the concessions, the Post reported.
5) A message was left with an AIG spokesman seeking comment.
6) New York-based AIG faced intense public and congressional criticism last March when it paid out hundreds of millions of dollars in retention bonuses to employees months after receiving the government bailout.
7) When the credit crisis hit in the fall of 2008, the U.S. government rescued AIG from the brink of collapse in exchange for an 80 percent stake in the insurer. AIG's near collapse was not due to its traditional insurance operations, but instead risky derivatives contracts written by the financial products division.


AIG narrows 4Q loss, continues restructuring
(APW_ENG_20100226.0807)
1) AIG said Friday it lost $8.87 billion in the fourth quarter as its general insurance business remained weak and it incurred expenses from paying back government loans.
2) The embattled insurer also said in an annual regulatory filing that it may need additional support from the government. However, AIG has included such warnings in past filings with the Securities and Exchange Commission.
3) The fourth-quarter results were an improvement from the $61.7 billion it lost in the year ago period, but they were worse than analysts expected. They also followed two straight profitable quarters.
4) The company reported a 2.2 percent drop in new premiums in its Chartis general insurance business, compared with a year earlier. It also reported $6.2 billion in expenses from repaying government loans.
5) Investors weren't happy with AIG's news, and bid its stock down nearly 13 percent in pre-opening trading.
6) New York-based American International Group Inc. said Friday it lost $65.51 per share in the last three months of 2009. The compares to a loss of $458.99 per share in the fourth quarter of 2008.
7) On average, analysts surveyed by Thomson Reuters forecast a quarterly loss of $3.94 per share.
8) AIG was bailed out in September 2008 by the government as the financial crisis spiraled out of control. The insurer has received aid packages with a total value of $182.5 billion from the government. In return for that financial support, the government received an 80 percent stake in AIG.
9) The company wasn't undermined by its traditional insurance businesses, but instead by underwriting risky credit derivatives contracts. A plunge in the value of those contracts was the primary driver of AIG's near-collapse.


AIG sells Alico unit to MetLife for $15.5 billion
(APW_ENG_20100308.0526)
1) American International Group will sell its overseas life and health insurance unit for $15.5 billion to MetLife Inc., the insurer said Monday, as it attempts to repay billions in government aid.
2) In the deal announced Monday, MetLife will pay $6.8 billion in cash, and the rest in stock and equity units.
3) The cash portion of the sale will be used to reduce a $47.9 billion investment in AIG by Federal Reserve Bank of New York.
4) "With this sale of Alico, along with the sale of AIA to Prudential PLC announced last week, we are on track to generate approximately $50.7 billion from these two transactions alone, consisting of approximately $31.5 billion in cash to repay the FRBNY, plus another approximately $19.2 billion in securities that we will sell over time to repay the government," said AIG Chairman Harvey Golub. "Both sales give AIG greater flexibility to move forward with our restructuring and rebuilding efforts."
5) AIG owes the government almost $130 billion in bailout funds, including $47.3 billion owed to the U.S. Treasury and $34.5 billion in assistance tied to the value of investments the New York Fed bought to prop up AIG.
6) The deal will give MetLife a larger presence in Japan as well as high-growth markets in Europe, the Middle East and Latin America.
7) Alico, which operates in more than 50 countries, is the second international unit AIG has sold this month. On March 1, AIG said it would sell a cornerstone of its business, Asia-based life insurer AIA Group, to Britain's Prudential PLC in a government-approved $35.5 billion deal.
8) AIG and MetLife are based in New York.
9) AIG shares rose 10 cents to $28.18 in premarket trading.


AIG aircraft unit debt offering has strength
(APW_ENG_20100310.1178)
1) International Lease Finance Corp., the aircraft-leasing unit of American International Group Inc., is looking to raise $1.3 billion in loan offerings as it seeks new funds to help repay some of its debt.
2) The loan sales mark ILFC's first attempt at raising money since AIG received a federal bailout package originally worth up to $182.5 billion in the fall of 2008. ILFC previously took $3.9 billion from AIG to pay back some of its debt.
3) ILFC announced plans for a $750 million debt raise, secured by some of its aircraft and leases, on Feb. 22.
4) The unit is now looking to borrow $1.3 billion by selling a $750 million five-year term loan and a $550 million six-year term loan, AIG spokesman Mark Herr said.
5) The sales are expected to close by month's end.
6) Such a move is a good sign for both ILFC and AIG, analysts said.
7) Investors were "so sensitive on the down side, they have to recognize the external environment is improving," said Bill Bergman, an analyst at Morningstar.
8) A recovery in the credit markets over the past year and a half has made it possible for even bailed-out companies like AIG to tap investors for fresh funds.
9) Century City, Calif.-based ILFC leases its commercial jets, one of the world's largest fleets, to airlines. As of Dec. 31, the company owned 993 jet aircraft. ILFC was thought to be one of the New York-based insurer's jewels. But like many of AIG's business units, it has been up for sale as the insurer struggles to pay back its debt to the U.S. government.
10) Aite Group senior analyst Clark Troy said ILFC is not a core asset for AIG going forward.
11) "(CEO Robert) Benmosche is an insurance guy," Troy said. "Plane leasing is not an insurance line of business."
12) In the last two weeks, AIG has announced two big asset sales that will bring in nearly $51 billion to help pay its debt to the government. As of Dec. 31, AIG owed the Treasury and the Federal Reserve Bank of New York nearly $130 billion.
13) Last month, when AIG announced an $8.87 billion fourth-quarter loss, CEO Robert Benmosche said his company was continuing to address funding needs and explore options for restructuring ILFC.
14) In a recent regulatory filing by IFLC, the company said AIG has plans to support ILFC through Feb. 28, 2011, "to the extent that secured financing, aircraft sales and other sources of funds are not sufficient to meet liquidity needs."
15) AIG shares gained $2.66, or 8 percent, to $35.43 in afternoon trading.


Moshe Greenberg, Bible scholar, dies at 81
(APW_ENG_20100517.0637)
1) Moshe Greenberg, an influential scholar whose work won the first-ever Israel Prize for biblical studies, has died, one of his sons said Monday. He was 81.
2) Greenberg's award-winning Bible scholarship bridged the gap between the commentary of ancient Jewish sages and modern-day religious studies, said Israel Knohl, a professor at Hebrew University of Jerusalem, a colleague of Greenberg.
3) Greenberg died Saturday morning at his Jerusalem home, said his son Rafi Greenberg.
4) His definitive two-volume commentary on the Book of Ezekiel described, among other things, how the prohibition of murder became an unbreakable taboo with the Abrahamic religions because of the rise of a belief in man's connection to God, Knohl said.
5) The Israel Prize is the country's highest civilian award. Prizes are given in several fields on Israel's independence day every year.
6) Born in Philadelphia, Pennsylvania, Greenberg immigrated to Israel in 1970 and became a prominent voice whose work occasionally touched on political topics. He countered those who used the Book of Joshua as a justification for certain forms of violence in defense of Israel, Knohl said.
7) In 1994, along with a colleague, he became the first person to win the Israel Prize for Bible research.
8) He is survived by his wife, Evelyn, and three sons. Rafi Greenberg is an archeologist at Tel Aviv University. Another son, Joel Greenberg, worked for decades as a journalist in Israel for publications including The New York Times and the Chicago Tribune.


Lawyers say no criminal charges in AIG cases
(APW_ENG_20100522.0655)
1) The Justice Department has decided not to file criminal charges against the former head of a division at American International Group Inc. whose dealings in mortgage-related securities nearly bankrupted the insurance giant and led to a controversial government bailout, according to lawyers involved in the cases.
2) The decision appears to bring an end to the criminal investigation of AIG, but a Securities and Exchange Commission probe into AIG and the dealings of its London-based Financial Products subsidiary is continuing and could lead to a civil securities fraud case.
3) Lawyers representing Joseph Cassano, who formerly ran AIG's Financial Products unit, and Andrew Forster, who worked for Cassano, said they were told by federal prosecutors late Friday that no criminal charges would be filed.
4) A person familiar with the government's criminal investigation of AIG confirmed that charges wouldn't be brought. The person was not authorized to speak publicly on the matter and spoke on condition of anonymity.
5) The Justice Department declined comment Saturday.
6) SEC investigators have been involved in the case from the start, but it is unclear when a decision would be made on a civil fraud case.
7) Federal prosecutors were investigating AIG's Financial Products unit, which dealt in financial contracts called credit default swaps that helped sink AIG in September 2008, leading to a taxpayer-funded bailout. The credit default swaps AIG sold were insurance-like guarantees on mortgage securities that wound up forcing AIG to pay out billions of dollars after the housing market went bust.
8) Investigators were looking into whether Financial Products officials tried to deceive investors and AIG's auditors, PricewaterhouseCoopers, by misstating the accounting value of a credit default swap portfolio.
9) When AIG posted a loss for the fourth quarter of 2007, it pinned the blame on an $11 billion writedown related to the credit default swaps held by its Financial Products group.
10) If AIG couldn't make good on its promise to pay off the contracts, many of which were held by major banks, regulators feared the consequences would pose a threat to the whole U.S. financial system. That led the government to go ahead with the $180 billion bailout.
11) Cassano's attorneys, F. Joseph Warin and Jim Walden, said in a statement that the two-year federal investigation was intense and difficult.
12) "The results are wholly appropriate in light of our client's factual innocence," said the statement, which lauded federal agents and prosecutors for following the facts to end the case. "This result was the product of two things: An innocent client and fair prosecutors and agents. The system worked," the statement said.
13) Forster's attorneys, David Brodsky and Richard Owens, said in a statement that they knew it would have been easy for federal prosecutors to win a grand jury indictment, but praised them for listening to their client's case.
14) "We knew the prosecutors were smart, fair and open-minded and that, given a full opportunity to present all the evidence, we could convince them that our client acted at all times in good faith. In the end, the facts were stronger than the emotions surrounding AIG's problems," the statement said.
15) Cassano left AIG in 2008, shortly after the $11 billion loss was reported. Forster is still employed by the company.
16) An AIG spokesman did not return a telephone message left Saturday.
17) The AIG bailout has drawn much public ire, largely because the company paid employees $165 million in retention bonuses after the company nearly failed and had to be bailed out by the government.
18) Nearly two years after a meltdown in the market for subprime mortgage securities cascaded into the worst financial crisis in the U.S. since the 1930s, prosecutors have had little luck bringing criminal cases against top financial executives. Last November two executives at Bear Stearns who ran hedge funds that collapsed after betting on the subprime mortgage market were acquitted of charges that they lied to investors.


Treasury: AIG in better shape to repay bailout
(APW_ENG_20100526.1019)
1) Insurance giant American International Group Inc. is better positioned to pay back all of its $182 billion federal bailout, a key Treasury official plans to testify Wednesday.
2) But AIG's ability to repay taxpayers depends on its future profitability and the insurance industry's strength, Treasury chief restructuring officer Jim Millstein says in his prepared testimony. He says AIG must complete the planned sales of two large insurance subsidiaries and regain the market's confidence.
3) "It will take time to repair full the damage to their franchises, particularly in the United States," Millstein says.
4) AIG received the largest bailout of any company during the financial crisis that crested in September 2008. The company could not meet its financial obligations after selling guarantees on mortgage-related investments that later lost value.
5) Millstein is scheduled to testify before the Congressional Oversight Panel, which is monitoring the $700 billion financial bailout. The panel has criticized officials who managed the bailout for failing to consider alternatives, such as filing for bankruptcy or demanding concessions from AIG's creditors.
6) The panel already heard from a regulator who failed to halt AIG's near-collapse and from officials who managed the rescue for the Federal Reserve Bank of New York.
7) AIG CEO Robert Benmosche also is scheduled to testify. He says in prepared testimony that AIG is less reliant on government aid because it has been able to raise money from private investors in recent months.


Treasury sees options available for AIG repayments
(APW_ENG_20100602.1180)
1) Treasury Secretary Timothy Geithner on Wednesday looked past the collapse of an American International Group deal to sell off a subsidiary, saying the insurance giant has other options for paying back its $182 billion government bailout.
2) Geithner addressed the issue after Prudential PLC, a British company, said it was backing out of a deal to buy American International Assurance. The deal faltered after Prudential shareholders balked at the $35.5 billion price. AIG refused to accept less money.
3) Private analysts question whether AIG did the right thing in refusing to cut its asking price. Some say they wonder whether the taxpayers will ultimately be repaid.
4) But Geithner praised the company's decision to walk away from the Prudential offer.
5) "AIG is now free to pursue a bunch of other options to help maximize the return, reduce any risk of loss to the taxpayer," Geithner told reporters at the Treasury Department.
6) "They have got a very strong management team, a much stronger board in place, making incredibly impressive progress frankly in restructuring that entity ... putting us in a position that we can maximize the return to taxpayers as a whole," he said.
7) Geithner did not address how much taxpayers may ultimately recoup in the $182 billion bailout, the largest of the government rescues. The Congressional Budget Office in March estimated that the bailout will cost taxpayers $36 billion.
8) Others outside the government do not share Geithner's optimism.
9) "It's difficult to say whether this means good things or bad things for taxpayers," said Bill Bergman, a senior analyst at Morningstar in Chicago. "It is still uncertain how much taxpayers will get repaid."
10) AIG refused to comment on the collapsed deal other than to release a letter that Robert Benmosche, AIG president and CEO sent to company employees. It said "AIG is in the best shape it's been in two years."
11) Benmoche said that the company will have "several options to consider regarding AIA -- more than we did in March."
12) Many private analysts believe that AIG will return to a previous effort to sell the unit in an initial public offering. AIG last year said it was considering an offering of AIA through the Hong Kong stock exchange, prior to negotiating a deal with Prudential
13) Sachin Shah, a special situations and merger arbitrage strategist at Capstone Global Markets, said a company typically would sell a 15 percent to 20 percent stake of a subsidiary through an IPO. Shah said it would then sell off future pieces of the company in blocks to larger investors or through secondary stock offerings over time.
14) On Tuesday, AIG rejected Prudential's revised offer of $30.38 billion.
15) Shah said it was possible that the government supported AIG's decision to balk at the reduced price because of its potential impact on future sales.
16) "You don't want to send a bad message" to potential future buyers that you are willing to take distressed sale prices, Shah said.
17) Cathy Seifert, an equity analyst at Standard & Poor's in New York, said that AIG basically has three options -- try to find another big buyer for all of AIA, raise money through an IPO or break up AIA for sale to other companies.
18) She said the least likely option may be finding a buyer as large as Prudential.
19) "That would be like selling a real high-end home in a difficult real estate market. The pool of available buyers is not that large," she said.
20) As of March 31, AIG's outstanding government aid balance totaled $134.21 billion.
21) Of that package, AIG must repay the government $101.61 billion in loans. The remaining $32.61 billion is tied to the value of assets the government took over as part of the bailout. As those risky investments are repaid, that money goes directly back to the government.
22) The proceeds from the AIA sale would have been used to directly reduce the amount of assistance AIG received from the government. It would have cut down AIG's government aid package by more than 25 percent and would have been by far the largest repayment the insurer made since getting the initial bailout in 2008.
23) AIG still plans to use about $15.5 billion it expects to receive from the sale of its American Life Insurance Co. division to MetLife Inc. to repay the government loan.


AIG agrees to pay $725M to investors in settlement
(APW_ENG_20100716.1109)
1) American International Group Inc. and some of its directors and officers have agreed to a $725 million settlement to resolve allegations of wide-ranging fraud laid out in a class action suit led by three Ohio pension funds.
2) Ohio Attorney General Richard Cordray said Friday the latest figure will combine with previous AIG settlements reached with secondary defendants to pay about $1 billion to shareholders, including pensions representing firefighters, police, teachers, librarians and others. He characterized it as the 10th largest securities litigation settlement in U.S. history.
3) The lawsuit alleged anti-competitive market division, accounting violations, and stock price manipulation by AIG between October 1999 and April 2005.
4) "The serious misconduct by AIG more than deserves today's large settlement," Cordray said.
5) A message was left with AIG representatives seeking comment.
6) Cordray's office represented the Ohio Public Employees Retirement System, State Teachers Retirement System of Ohio, and the Ohio Police and Fire Pension Fund, who were lead plaintiffs.
7) The settlement still requires court approval, after which an initial payment will be made of $175 million, Cordray said. AIG will fund the remaining $550 million through one or more offerings of common stock.
8) If the necessary amount can't be raised, plaintiffs will have three options: terminate the agreement, acquire shares of AIG stock worth $550 million, or grant an extension, he said.
9) The suit alleged that AIG:
10) --Committed accounting fraud that culminated in a $3.9 billion restatement in May 2005 that included an array of transactions through which the company artificially boosted its reported claims reserves. Those transactions included allegations relating to a $500 million no-risk fraudulent reinsurance transaction with General Reinsurance Corp. in relation to which one AIG executive and four General Reinsurance executives were found guilty of securities fraud.
11) --Divided the market for certain types of insurance by paying tens of millions of dollars in undisclosed contingent commissions to insurance brokers and through bid-rigging.
12) --Engaged in stock price manipulation that Cordray called "straightforward," in which AIG executives ordered traders to inflate the company's stock price.
13) In addition to the $725 million announced Friday, the case against AIG also includes several earlier settlements: $72 million with General Reinsurance; $97.5 million with PricewaterhouseCoopers LLP, and $115 million with former AIG chairman Hank Greenberg and other AIG executives and related corporate entities.


AIG posts 2Q loss of $538M on restructuring costs
(APW_ENG_20100806.0420)
1) The insurance giant AIG is reporting a $538 million loss in the second quarter due to charges related to selling assets to repay the federal government bailout.
2) AIG, which was rescued by the government during the financial meltdown, said Friday its net loss attributable to common shareholders amounted to $3.96 per share. It had a profit of $311 million, or $2.30 per share, a year ago.
3) The net loss attributable to AIG was a larger $2.66 billion. That is much bigger than the $538 million loss attributed to its shareholders because it includes the portion that the government is shouldering. The government owns 80 percent of AIG.
4) Removing the charges, AIG's profit is $1.99 per share. Wall Street expected 99 cents per share.
5) AIG shares soared $2.10, or 5.3 percent, to $42 in pre-market trading.


AIG repaying nearly $4 billion in federal loans
(APW_ENG_20100823.0387)
1) American International Group Inc. says it is repaying nearly $4 billion in federal bailout loans.
2) The insurer said Monday it will pay back the taxpayer-funded loans with proceeds from a recently completed $4.4 billion debt sale at its aircraft leasing company, International Lease Finance Corp.
3) The payment will trim AIG's outstanding balance on its credit line with the Federal Reserve Bank of New York to about $15 billion. The payment is the largest that AIG has made to that credit line.
4) Overall, New York-based AIG received a $180 billion federal bailout during the financial crisis to avoid collapse.


Reports: AIG near plan to trim government stake
(APW_ENG_20100929.0099)
1) Published reports say American International Group Inc. is in accelerated talks on a plan to pay back its taxpayer debt and reduce the government's majority stake in the insurance giant.
2) The Wall Street Journal and The New York Times, citing people briefed in the negotiations, reported late Tuesday that the plan is expected to be announced in the coming days, well before November's midterm elections.
3) AIG was one of the hardest hit financial companies by the credit crisis and received multiple bailout packages from the government. AIG's outstanding balance of assistance from the government totaled $132.1 billion as of June 30.
4) Messages were left seeking comment from AIG and the Treasury Department but were not returned as of late Tuesday.


AIG reaches deal to repay government
(APW_ENG_20100930.0391)
1) AIG has reached a deal to repay the government billions of dollars in assistance it received during the credit crisis.
2) The U.S. Treasury will swap debt it currently holds in AIG for common stock and then sell those shares over time.
3) New York-based American International Group Inc. was one of the hardest hit financial companies by the credit crisis. It received a bailout package worth as much as $180 billion from the government.


AIG bailout exit doesn ' t resolve losses from TARP
(APW_ENG_20100930.1109)
1) American International Group finally has a plan to exit the biggest of the Wall Street bailouts a month before midterm elections. But much as embattled Democrats might wish otherwise, the book on TARP won't close anytime soon.
2) There's no guarantee taxpayers who gave AIG a $182 billion bailout will be made whole under the plan the company announced Thursday. Under the deal, Treasury will swap its majority stake in AIG for common stock and then sell those shares over time.
3) The government loses its authority to tap Troubled Asset Relief Program funds on Sunday. Democrats facing tough re-elections hope voters will see the bailouts as nearing an end.
4) That will be a tough case to make. Close to $190 billion in TARP money remains unpaid, and the Congressional Budget Office estimates that taxpayers will never get back about $66 billion of it.
5) The public remains angry about the bailouts, which were launched in the Bush administration's final months. Americans have been particularly furious over the outsize bonuses that bailed-out firms paid to executives. The anger may dissipate as the economy improves, but it will linger until most sitting lawmakers are out of office, said Norman Ornstein, resident scholar at the conservative American Enterprise Institute.
6) "Finding a way to reduce the anger, much of it misplaced, over what TARP did, is a pretty strong political goal" for the Democrats, he said. It will be an uphill battle, Ornstein said.
7) TARP, which Obama administration officials say helped stabilize the financial system, has been targeted by the tea party movement as a wasteful giveaway that rescued Wall Street while ordinary Americans suffered the effects of the Great Recession. Democratic and Republican lawmakers who voted for the bailout have had to defend their votes.
8) The deal will give Treasury a 92.1 percent stake in AIG before it begins selling its shares. But it can't be completed until AIG proves its strength by displaying its ability to raise money from private investors and regain a top rating from credit agencies.
9) Otherwise, "this deal won't go through," CEO Robert Benmosche said in an interview Thursday. "The Treasury wants to assure itself it's investing in a company with the strength to be competitive in the marketplace."
10) Benmosche said he expects the transaction to take place in the first quarter of 2011. S&P credit analyst Kevin Ahern said AIG's rating will likely be upgraded by the end of October, when it sells off a life insurance subsidiary and spins off another in an initial public offering.
11) Before the stock swap, AIG will repay about $20 billion in loans it received from the Federal Reserve Bank of New York. AIG plans to repay that debt in part through earnings it generates and the sale of some its subsidiaries. AIG has been selling some of its units since it received the initial bailout in September 2008.
12) CEO Benmosche said he would have preferred to put off an exit agreement until November, after the completion of some sales. But he said he wanted to make sure that as TARP expired, AIG wasn't again thrust into the spotlight as a "ward of the state."
13) Treasury Secretary Timothy Geithner praised the agreement. He said it "puts taxpayers in a considerably stronger position to recoup our investment in the company."
14) The government will receive about 1.66 billion shares of AIG common stock in exchange for its $49.1 billion investment. The shares would be worth about $29.67 apiece. In trading Thursday, shares rose $1.65, or 4.4 percent, to $39.10. So if the government is able to sell shares at their current price, it would make $15.8 billion in profit on that part of its stake.
15) Part of the government AIG's $182 billion bailout went unused. The rest is expected to be recovered from the sale of assets.
16) Treasury's work on the bailouts is hardly finished. As of Aug. 31, Treasury had tapped $460 billion from TARP for banks, auto makers and mortgage companies. Of that, $386 billion was disbursed, and $187 billion had not been repaid. AIG and automakers GM and Chrysler held the bulk of that money.
17) AIG was one of the financial companies hit hardest by the credit crisis and received the largest bailout the government doled out. The insurance giant was not undone by its traditional business. Rather, it was felled by its dealings in complex derivatives.
18) AIG also drew criticism for continuing to pay out bonuses to employees after it received the bailout. Some of those employees worked in the division that nearly destroyed the company.
19) The government stepped in to rescue AIG because the insurer worked with hundreds of financial institutions throughout the world. The government believed at the time that a collapse of AIG would further hurt the already fragile credit markets, which had been shaken by the bankruptcy of Lehman Brothers.


Report: AIG to sell India mutual fund business
(APW_ENG_20101004.0494)
1) American International Group Inc. is in talks to sell its mutual fund business in India for around $10 million, India's Mint newspaper reported Monday, as the troubled U.S. insurer struggles repay its $182 billion U.S. government bailout.
2) AIG is in talks with at least four asset management companies to sell its AIG Global Investment Group Mutual Fund for 4 percent to 5 percent of the value of its assets under management, which total 10.2 billion rupees ($230 million), Mint reported citing three unnamed sources with knowledge of the deal.
3) AIG has been selling off subsidiaries as it finalizes plans to exit its government bailout before U.S. midterm elections.
4) The company said last week it will sell its two Japanese life insurance units to Prudential Financial Inc. for about $4.2 billion in cash.
5) It is also planning to spin off its Asia life insurance unit in an initial public offering on the Hong Kong Stock Exchange.
6) The Wall Street Journal reported Monday that the planned IPO of the Asian unit, called AIA Group Ltd., could value the unit at up to $30.5 billion.
7) Citing an unidentified person familiar with the deal, the newspaper said AIG is planning to float about half of its Asian insurer. The newspaper said the $30.5 billion valuation represents the top end of a price range for the offering which it said is expected to be announced Tuesday.
8) AIG was one of the financial companies hardest hit by the economic meltdown and got the government's largest bailout package. The government received an 80 percent stake in the company in return.


Insurance giant AIG posts $2.4B loss for 3Q
(APW_ENG_20101105.0433)
1) Insurance giant AIG is reporting a $2.4 billion loss for the third quarter, dragged down by hefty charges tied to selling off some assets.
2) American International Group Inc. is in the process of repaying more than $100 billion still outstanding from a government bailout it received two years ago during the credit crisis. It is selling off assets to help repay taxpayers.
3) AIG lost $2.4 billion, or $17.62 per share, compared with earnings of $92 million, or 68 cents per share, a year ago.
4) Restructuring-related charges amounted to $4.5 billion. The sale of AIG's 80 percent stake in consumer credit business American General Finance Inc. weighed heavily on the quarter.
5) Revenue for the three months ended Sept. 30 dipped 3 percent to $19.09 billion from $19.6 billion, the New York-based company said Friday.


AIG takes key step to pay off largest bailout
(APW_ENG_20101208.0777)
1) Insurance conglomerate American International Group Inc. is taking a key step toward paying off a bailout that was at one point worth $182 billion -- the largest of the financial crisis.
2) The company says in a public filing Wednesday that it will pay off a loan from the Federal Reserve Bank of New York. AIG says that will clear the way for the Treasury to sell off the government's stake. Treasury's stake in AIG will temporarily rise from roughly 80 percent to 92 percent, as part of the deal.
3) AIG became a symbol for excess risk on Wall Street during the crisis that peaked in late 2008. The company sold insurance-like protection against losses on bonds without having the funds to cover those losses.