AIG Q1 loss narrows to $4.35 billion
NEW YORK -- The New York-based insurance giant said it lost $4.35 billion, or $1.98 a share, during the quarter ended March 31, compared with $7.81 billion, or $3.09 a share, during the same quarter last year.
AIG lost $61.7 billion during the fourth quarter — the most ever in a quarter by a U.S. corporation — amid the mushrooming credit crisis and shortly after its near collapse.
AIG's first-quarter operating loss, which excludes impairment and accounting charges, totaled $1.6 billion, or 97 cents a share. The impairment charge for the quarter totaled $2.63 billion, compared with $3.96 billion during the year-ago period.
The first-quarter loss was primarily tied to costs from the winding down of its financial products unit, which was the at the center of the insurer's near collapse last fall, and costs associated with a government bailout of the insurer.
AIG was bailed out by the government on the same weekend in September that investment bank Lehman Brothers Holdings failed. Including the initial support, AIG has received four rounds of government support to help it remain in business amid fears that a full collapse of the insurer that was once the world's largest would create widespread devastation in the financial markets.
The U.S. government provided AIG with an $85 billion loan in September. As market conditions worsened and losses piled up at the insurer, the government revised and expanded its loan package several times. Loans available to AIG total nearly $180 billion after being expanded in March. In return, the government has taken an 80% stake in the firm.
Unlike when it announced its fourth-quarter results, AIG said there were no new loans or deals with the government.
"We are simply executing on what we have previously announced," Chairman and Chief Executive Edward Liddy said during a conference call of the insurer's plans to repay the government loans. Liddy added that AIG continues to repay a portion of its outstanding government loans with preferred interests in various subsidiaries, as well as more traditional cash and interest repayments.
