"We will do everything we can to not require additional federal money," the CEO of troubled insurance giant AIG told a congressional panel today.
Totaling up the $170 billion AIG has received from Federal Reserve borrowings and money from the Troubled Assets Relief Program, CEO Ed Liddy told the House Oversight and Government Reform Committee that the company believes that "in today's marketplace that that is sufficient and we will not need additional money."
But the declaration came with a big if: "That answer is very dependent upon what happens to the overall economic conditions and financial market place around the globe."
Liddy assured the lawmakers that "we're doing everything we can" and that AIG believes it has "a terrific plan, a viable plan that's not as dependent on the capital markets as other plans might have been. But asset values have to stay strong. There has to be a capital market that enables us to take businesses public."
"I think that that will happen, but I can't give you a guarantee on that. I can't control what happens in the worldwide financial market place."
Skeptical lawmakers pressed for more details of the plan, called Project Destiny. The panel's chairman, Rep. Edolphus Towns, D-N.Y., said that Congress needs to fully understand the "long-range plan" for AIG.
Liddy cautioned that the details of the plan are sensitive and could destroy AIG's ability to remain competitive if released, but he did agree to release portions of the plan to the lawmakers.
Liddy's optimistic forecast is just one of four areas in which he touted "substantial progress" made as part of the company's ongoing restructuring.
"We have reduced, but not yet eliminated, the systemic risk that AIG presents to the global system," he said in his opening remarks.
Noting various restructuring moves within the company, and the "significant progress" in winding down the complex derivatives portfolio of the controversial AIG financial products division, which almost singlehandedly drove the company into the ground with risky credit-default swaps. The exposure has now dropped from $2.7 trillion to $1.5 trillion, Liddy said.
"We are selling assets and businesses where possible, despite adverse conditions in global financial markets," he continued.
When the CEO first testified before the House panel March 18, lawmakers grilled him for more than five hours about the company's controversial payment of $165 million in employee retention payments earlier that month.
In taking the witness stand again today, Liddy reminded lawmakers of the government's massive stake in AIG.
"It is critical that we not lose sight of the fact that we are partners," he said. "When the employees of AIG make mistakes, we expect to be criticized. But rampant, unwarranted criticism of AIG serves only to diminish the value of our businesses around the world -- the businesses we are attempting to sell to repay the American taxpayer -- to the detriment of our shareholders, including taxpayers, who own some 80 percent of AIG.
"Our plan is explicitly designed to avoid having to divest AIG assets at fire-sale prices," noted Liddy. "In fact, just the opposite is true. We intend for taxpayers to realize the fullest possible value from every asset disposition."