For the first time since the financial crisis of 2008, U.S. taxpayers won’t own a majority of giant insurance company AIG.

That’s because the Treasury Department said over the weekend it has launched a public offering of $18 billion of stock in bailed-out insurer American International Group (AIG), bringing its stake well below the 50% threshold to around 20%.

The milestone is impressive considering the U.S. owned as much as 92% of AIG following a very unpopular government rescue worth up to $182.3 billion that was aimed at preventing a collapse of the financial markets.

But by unloading a slew of AIG’s assets, including another $2 billion of Asian life insurer AIA Group just last week, and improving financial results under CEO Robert Benmosche, the U.S. has been able to pare its stake to 53% this year.

Last week New York-based AIG promised to buy up $5 billion of its own shares in the equity offering.

Now that the government is a minority shareholder in AIG, the insurance giant will come under greater regulatory scrutiny from the Federal Reserve.

The Treasury Department said underwriters in the AIG offering have been granted a 30-day option to acquire an additional $2.7 billion of shares to cover any over-allotments.

The offering is being led by Citigroup (C), Deutsche Bank (DB), Goldman Sachs (GS) and J.P. Morgan Chase (JPM). Other banks are serving as joint book runners in the deal, including Bank of America’s (BAC) Merrill Lynch, Barclays (BCS), Morgan Stanley (MS) and Wells Fargo (WFC).

Shares of AIG retreated 2.74% to $33.06 on the news, but the slide erases just a slice of their 2012 rally of 46%.

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