AIG shares hit fresh lows, threaten U.S. losses

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NEW YORK (Reuters) - Shares in bailed-out insurer American International Group <AIG.N> fell to their lowest levels in nearly eight months on Monday, potentially moving them into loss-making territory for the U.S. Treasury.

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The Treasury holds 92.11 percent of AIG and has a break-even point of about $28.72 per share on the stock.

AIG shares fell 3.4 percent to $29.67 in afternoon trade. Shares dipped to as low as $29.45 at one point in the morning.

Assuming the government were to sell the stock at a 3 percent discount to its closing price -- as researchers say the Treasury did with its shares in Citigroup <C.N> -- it would lose money on the sale.

A source familiar with the process said on Monday the government and company had begun a roadshow for an offering of shares expected later this month. The source said the offering would likely price at a discount in the mid-single digit range compared to the stock's last close.

In mid-January, the government stood to make a profit of more than $27 billion on its AIG stock, but the shares have lost more than a third of their value since. Last Thursday, AIG reported a loss of more than $1 billion from continuing operations for the first quarter.

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AIG has said it expects the government to have sold off its whole position by mid-2012.

(Reporting by Ben Berkowitz; editing by Gerald E. McCormick, Bernard Orr)