CorporateAIG to take 2 yrs to repay bailout funds: report
Troubled insurer American International Group (AIG) will take two years to repay the bailout funds, which it had received from the US government at the peak of the financial crisis last year, says a media report.
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The US Treasury had infused about $180 billion of taxpayer-funds into AIG last year.
In an interview to the Financial Times, AIG Chief Executive Officer Robert Benmosche said it would take at least two years for AIG to sell businesses and earn enough profits to repay the government and persuade it to sell its 80 per cent stake.
"The more time (we have), the greater the probability we"ll pay back all of (the aid). But our goal is to pay back all of it," the report quoted Benmosche saying.
However, the daily said the authorities are not as confident.
According to the publication, the US Treasury Secretary Tim Geithner, recently told the Congress he did not believe the government [would] be fully refunded for its largesse towards AIG. The Government Accountability Office has estimated that US taxpayers would end up losing more than $30 billion on the insurer.
The report said, Benmosche considers his aggressive management style to have helped stop the rot at a company that was heading for liquidation and was being lambasted by politicians for paying bonuses with federal money. The Obama administration"s "pay czar" Kenneth Feinberg
considers that AIG needs to sell its assets in order to repay taxpayer-funds.
"They were basically saying, "let"s divest everything"... The problem for me was that if the sum of the parts is less than the whole, and the whole is what you need to pay back the government, it’s not going to work ... So the strategy wasn"t nuts. What was nuts was the speed at which we were attempting to do it," Benmosche told Financial Times.
The 65-year old Benmosche took charge at AIG in August after serving MetLife for eight years.