Feb. 23 (Bloomberg) — American International Group Inc., the insurer rescued by the government, is in talks with the U.S. for more funding as it prepares to report the biggest corporate loss in American history, CNBC reported, citing unidentified people familiar with the situation.
AIG may report a loss of as much as $60 billion, CNBC’s David Faber said. The company is also exploring bankruptcy, which is an unlikely outcome, Faber said.
A loss may cast doubt on the New York-based insurer’s ability to repay the government, which controls 80 percent of the shares. AIG’s rescue package was expanded to about $150 billion in November as regulators tried to reduce losses at firms that did business with the company. The insurer posted more than $60 billion in writedowns and unrealized losses in two years through Sept. 30, 2008.
Fourth-quarter results, which may be announced next week, will probably include writedowns on assets including securities tied to commercial mortgages, CNBC said today. The company’s board will meet this weekend to discuss another expansion of the rescue, the network reported. AIG spokeswoman Christina Pretto didn’t immediately return a call from Bloomberg seeking comment.
The insurer slipped 4 cents to 50 cents at 2:59 p.m. in New York Stock Exchange composite trading, and has plunged 99 percent in the past 12 months.
To contact the reporters on this story: Hugh Son in New York at [email protected]; Vivek Shankar at [email protected]
Last Updated: February 23, 2009 15:09 EST
By Hugh Son and Vivek Shankar
Source: Bloomberg