NEW YORK (Reuters)—The U.S. Securities and Exchange Commission has asked insurer AIG to provide more disclosure about how and why it assigns credit ratings to investments in its portfolio, according to letters between the regulator and the company disclosed Monday.

The two SEC inquiries, from May 20 and June 10, related to the company's first-quarter financial report, which was filed in early May.

Page 142 of that report details the company's bond investments, both by credit ratings and by type. In a comment prior to the table, New York-based American International Group Inc. notes that its investment decisions are based on internally generated ratings and that it uses outside agencies' ratings as "one source of independent perspective for consideration in the internal analysis."

That explanation prompted questioning from the SEC, which asked in the May 20 letter for more details of the investments that received the internal review, the review procedures and the reasons for any difference between AIG's and the external agencies' ratings.

In a letter dated June 3, AIG Deputy General Counsel Kathleen Shannon said the company used an internal numerical system that tracks the ratings agencies' formulas, and that it usually based the rating on the issuer and not the bond.

"Those ratings may differ on occasion from the ratings of the principal rating agencies, not unlike the rating agencies differing among themselves as to the same issuer or security rating," Ms. Shannon said in the letter.

She said AIG had assigned ratings lower than the ones given by the ratings agencies for just over $20 billion, or 8%, of its rated securities. It has given a higher rating than the agencies for about $9.5 billion worth of bonds, or about 4% of its portfolio.

On June 10, the SEC asked AIG to come up with disclosure language for future filings on the source of its credit ratings.

AIG responded by letter on June 17 with language that it intends to use starting in the second quarter, indicating that the ratings in the table come from either the ratings agencies or, if no outside rating exists, its own evaluation.

AIG, which is in the later stages of repaying its $182 billion bailout by the U.S. government, reports second-quarter results later this week.