AIG CEO defends company amid huge losses
On a conference call with analysts, CEO Bob Benmosche defended the bailed-out insurer, saying its liquidity was strong and that it had ample resources available to continue repaying the U.S. government for its 2008 rescue.
"I can assure you we're in very good shape," said Benmosche, whom many people credit with rescuing American International Group from a breakup after taking over as CEO in 2009.
AIG's loss, its worst in nearly two years, stemmed from the declining fair value of its one-third stake in Asian insurer AIA <1299.HK>, writedowns on older airplanes at leasing business ILFC <ILFC.N> and catastrophe losses from hurricanes and typhoons.
AIG shares fell 3.4 percent to $23.80 in premarket trading. At that price, the stock is nearly $5 below the U.S. Treasury's break-even point.
Benmosche said AIG would be happy to buy back shares from the Treasury's 77 percent stake in the company, if it were interested in selling at what are currently loss-making prices, but he indicated that might be unlikely.
"Time is not of the essence for the U.S. Treasury," he said.
Benmosche also addressed the company's plans for the stake in AIA, which it was restricted from selling until late last month. The shares are held in a special entity, and the Treasury holds a preferred interest in that entity.
Backing out the cash in the special purpose vehicle, Benmosche said AIG owed about $6.8 billion on that preferred interest.
"Right now we're going to stand pat" on AIA, Benmosche said, adding that the company had a variety of options to pay down that balance.
(Reporting by Ben Berkowitz; Editing by Lisa Von Ahn)