New York state gives AIG helping hand

Scrounging for capital to avoid a ratings downgrade, American International General Inc. of New York has received the green light to access secondary assets.
New York Gov. David Paterson gave the embattled carrier the approval to tap $20 billion in assets held by its subsidiaries so that it can stay in business.
At a press conference today, the governor also said that he asked regulators to permit the carrier to make a bridge loan to itself.
Mr. Paterson also said that he had spoken with Eric Dinallo, New York’s insurance superintendent, and asked him to speak with federal regulators about more loans to the carrier.
AIG remains financially sound, Mr. Paterson said.
The Federal Reserve has also selected Morgan Stanley of New York to aid AIG with its bridge loan, according to a CNBC report.
The carrier predicts it has until Wednesday to close that deal.
Although billionaire investor Warren E. Buffett was reportedly speaking with AIG on Friday and Saturday, insiders told CNBC that he is no longer in talks with the company.
AIG is also working on a sale of its domestic auto finance business and its airplane leasing corporation, International Lease Finance Corp. of Los Angeles, according to published reports.
The firm’s stock dipped to $4.04 just before the governor’s noon address, then rose to $5.71 by 2:35 p.m.

Related Topics: American International Group (AIG)