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Member, Beacon International Group, Ltd.
WASHINGTON—American International Group Inc.’s financial condition generally either has remained relatively stable or has shown signs of improvement since April, said the U.S. General Accounting Office in a third-quarter 2010 report issued Thursday.
The report said that as of Sept. 30, the outstanding balance of the Federal Reserve and Treasury Department assistance to AIG was $123.7 billion, a 4.2% decline from $129.1 billion in December 2009. “Overall, federal assistance appears to be facilitating a more orderly restructuring of the company,” said the GAO study.
The report said AIG’s property/casualty companies “have remained stabilized.” It said for the property/casualty commercial companies, “dollar volumes of premiums written trended downward throughout 2007 and 2008, but started to stabilize in the first quarter of 2009, and this trend has continued through the first three quarters of AIG.”
For the nine months ended Sept. 30, AIG’s property/casualty unit, Chartis Inc., reported a 1.3% increase in net premiums written vs. the comparable period in 2009, to $24.03 billion.
AIG Financial Products has continued to unwind its credit swap positions and portfolio of super senior credit default swaps, according to the GAO report.
The report also said that while AIG has repaid some of its federal debt, a large volume of activity involved exchanging its debt on the revolving credit facility with the Federal Reserve Bank of New York for federally preferred interest in AIG and AIA Group Ltd. and American Life Insurance Co. special-purpose vehicles.
The report, “Troubled Asset Relief Program, Third Quarter 2010 Update of Government Assistance Provided to AIG and Description of Recent Execution of Recapitalization Plan,” updates the GAO’s April 2010 report. It can be downloaded at www.gao.gov/new.items/d1146.pdf.