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AIG continues to suck billions of dollars from Treasury
St Petersburg News.Net
Friday 6th November, 2009
The sky is the limit for some American institutions relying on federal aid.
American International Group, or AIG as it is widely known, is drawing down $4.2 billion in additonal funds the Treasury Department.
The government-supported insurer is using the funds to assist in restructuring its loss-making mortgage guarantor and the plane unit it wants to sell.
AIG drew down the first tranche of $2.1 billion from its Treasury facility two months ago. On Friday it was ready to use the next $2.1 billion tranche. The new facility of $29.80 billion was approved in April. AIG has now received federal funded bail-outs four time.
AIG was initially rescued in September last year to protect banks that bought derivatives from the insurer from losses. The $182.30 billion bailout includes a line of credit of $60 billion from the Federal Reserve, $52.5 billion to purchase mortgage-backed securities issued or guarenteed by AIG, and a Treasury underwriting of $69.8 billion in two facilities.  Email this story to a friend
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