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| AIG in talks with US govt for new bailout: Report |
| Press Trust of India / London/Washington Feb 24, 2009, 17:57 IST |
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Beleaguered insurer American International Group is in discussions with the US government, which already has an 80 per cent stake in the entity, for a fresh lifeline.
The insurer is in talks with the government over a new bailout aimed at giving the firm "fresh capital to absorb an expected fourth quarter loss and more time to sell assets", UK daily Financial Times has reported.
Battered by the financial turmoil, AIG has already received taxpayers money twice as part of the lifeline extended by the Federal administration in the last five months.
Quoting people close to the situation, the report said, "AIG could announce the new rescue plan as early as next week, together with fourth-quarter results that are likely to show a loss bigger than the 24.5 billion dollars reported in the previous three months".
"Under the planned bail-out, which has not yet been finalised and could still change, the government would swap some of the $60 billion five-year loan it extended to AIG in November, and maybe some of the $40 billion in preferred stock it owns, for equity," the daily noted.
The Financial Times added that debt could also be swapped for new obligations with different terms in order to give AIG more time to repay the loan.
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