AIG posts profit of 455 million dollars
November 6, 2009
Bailed out insurance giant AIG on Friday announced a profit of $455 million (R3.4 billion) in the third quarter, a massive turnaround from a $24.4 billion loss in the same period last year.
The earnings from group, the largest recipient of US government aid during the financial crisis, were better than expectations.
Excluding special items, the profit was $2.85 per share, compared with a market forecast of $1.98 per share.
It was the second consecutive quarterly profit for American International Group after the prior quarter's earnings of $1.8 billion.
"Our results reflect continued stabilization in performance and market trends," said AIG president and chief executive Robert Benmosche.
"AIG employees are working to preserve the strength of our insurance businesses in a challenging market by working closely with our distribution partners, with third quarter 2009 showing signs of stabilization."
AIG was the largest single recipient of US bailouts with the government pumping more than $170 billion into the firm to keep it afloat and taking a controlling stake in the group in the process.
Once the world's biggest insurer, AIG was on the brink of bankruptcy in September 2008 when the government offered a financial lifeline in exchange for an 80 percent stake in the company.
The company was in trouble after backing trillions of dollars in risky financial products amid a US home mortgage meltdown that triggered a global financial crisis.
The latest quarterly figures showed revenues fell 11.8 percent to $26 billion as AIG sold off some or wound down of its operations.
AIG said it "continues to make progress on its disposition plan," having entered into agreements to sell or completed the sale of operations and assets to generate a total of $5.6 billion.
A government report in September showed AIG still owed nearly $121 billion in taxpayer aid.
The Government Accountability Office, an investigative arm of Congress, said the ultimate success of AIG's restructuring and repayment efforts remains "uncertain." - AFP
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