American International Group, Inc. NYSE: AIG, American International Group, Inc. (NYSE: AIG) also known as AIG, is a multinational insurance corporation with over 63,000 employees globally. AIG companies serve customers in more than 130 countries around the world; the company is a provider of property casualty insurance, life insurance and retirement services, and mortgage insurance. AIG's corporate headquarters are in New York City, its British headquarters are in London, continental Europe operations are based in La Défense, Paris, and its Asian headquarters are in Hong Kong. According to the 2013 Forbes Global 2000 list, AIG was the 62nd-largest public company in the world. [4] As of April 21, 2013, it had a market capitalization of $57.53 billion. AIG faced the most difficult financial crisis in its history when a series of events unfolded in late 2008. The insurer had sold credit protection through its London unit in the form of credit default swaps (CDSs) on collateralized debt obligations (CDOs) but they had declined in value.[24] The AIG Financial Products division, headed by Joseph Cassano, in London, had entered into credit default swaps to insure $441 billion worth of securities originally rated AAA. Of those securities, $57.8 billion were structured debt securities backed by subprime loans.[24][25] As a result, AIG's credit rating was downgraded and it was required to post additional collateral with its trading counter-parties, leading to an AIG liquidity crisis that began on September 16, 2008. The United States Federal Reserve Bank stepped in, announcing the creation of a secured credit facility of up to US$85 billion to prevent the company's collapse, enabling AIG to deliver additional collateral to its credit default swap trading partners. The credit facility was secured by the stock in AIG-owned subsidiaries in the form of warrants for a 79.9% equity stake in the company and the right to suspend dividends to previously issued common and preferred stock.[26][27][28] The AIG board accepted the terms of the Federal Reserve rescue package that same day, making it the largest government bailout of a private company in U.S. history.[citation needed] On January 21, 2009, it was announced that AIG would not be renewing its sponsorship of the Manchester United Soccer club at the end of the deal in May 2010.[29] On March 17, 2009, AIG announced that they were paying $165 million in executive bonuses, according to news reports. Total bonuses for the financial unit could reach $450 million and bonuses for the entire company could reach $1.2 billion.[30] President Barack Obama, who voted for the AIG bailout as a Senator[31] responded to the planned payments by saying "[I]t's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?" and "In the last six months, AIG has received substantial sums from the U.S. Treasury. I've asked Secretary [Timothy] Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole."[100] Politicians on both sides of the Congressional aisle reacted with outrage to the planned bonuses. Political commentators and journalists expressed an equally bipartisan outrage.[citation needed] Due to the Q3 2011 net loss widening, on November 3, 2011 the AIG shares plunged 49 percent year to date. The insurer's board approved the share buyback of as much as $1 billion.[32] The U.S. Department of The Treasury in December 2012 published an itemized list of the loans, stock purchases, special purpose vehicles (SPVs) and other investments engaged in with AIG, the amount AIG paid back and the positive return on the loans and investments to the government. [33] Treasury said that it and the Federal Reserve Bank of New York provided a total $182.3 billion to AIG, which paid back a total $205 billion, for a total positive return, or profit, to the government of $22.7 billion. In addition, AIG sold off a number of its own assets to raise money to pay back the government. On June 11, 2008, three stockholders, collectively owning 4% of the outstanding stock of AIG, delivered a letter to the Board of Directors of AIG seeking to oust CEO Martin Sullivan and make certain other management and Board of Directors changes. This letter was the latest volley in what the Wall Street Journal deemed a "public spat" between the Company's Board and management, on the one hand, and its key stockholders, and former CEO Maurice "Hank" Greenberg on the other hand. http://en.wikipedia.org/wiki/AIG

• published: 29 Aug 2013
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