Conservatorship may loom for AIG
The U.S. Treasury is now weighing conservatorship as an option for the beleaguered AIG, according to Bloomberg.
The U.S. Treasury is now weighing conservatorship as an option for the beleaguered AIG, according to Bloomberg.
Executives from American International Group Inc. of New York and officials from the Federal Reserve and Treasury have been meeting to discuss the carrier’s fate.
Conservatorship was among the options on the table to cover a funding gap of $75 billion to $100 billion at AIG, an insider told Bloomberg.
The insurer has been running out of time and ways to save itself.
In the last 24 hours, AIG had placed its hopes in the possibility of a loan to be arranged by Goldman Sachs Group Inc. and JPMorgan Chase & Co., but that possibility was dashed when the New York-based banks told the Fed that a private sector effort would be tough, the insider told Bloomberg.
A second option — a loan from the Fed — is still in play, an insider said.
Seizure by the government would make AIG the third such major institution to fall into conservatorship in recent weeks, following Fannie Mae of Washington and Freddie Mac of McLean, Va.
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