AIG, the enormous bailed-out insurance company, announced today that the sale of its ALICO life insurance unit to MetLife and its initial public offering of AIA on the Hong Kong stock exchange have netted billions of dollars to repay the U.S. government, which has generously and repeatedly extended a helping hand to AIG.
The ALICO sale closed today, bringing in $16.2 billion. That figure, coupled with the $20.51 billion brought in from the AIA IPO, results in a $36.71 billion capital raise. AIG president and CEO Robert H. Benmosche said in the announcement that the deals had raised enough cash to pay back the company’s roughly $20 billion credit facility with the Federal Reserve Bank of New York, one step among many in AIG’s ongoing bid to return to the private sector.
AIG’s announcement follows a determination last week by TARP watchdog Neil Barofsky that the Treasury Department had switched its accounting methods when projecting expected losses on the AIG bailout. The switcheroo had reduced the loss forecast by $40 billion, a wrinkle that some saw as a convenient minimization of taxpayer risk ahead of the midterm elections.
In any case, AIG looks ready to pay its credit card bill!
mtaylor [at] observer.com | @mbrookstaylor