AIG in black for 2 quarters in a row
By Stephen Bernard |
November 7, 2009, Saturday
|
Print Edition
Print Edition
AIG yesterday said it was profitable for the second straight quarter as its core insurance operations continue to stabilize after the company's bailout by the United States government last year.
American International Group Inc also got a lift from the increasing value of investments it still holds that soured last year and helped drive it to the brink of collapse.
Despite the improved performance, AIG CEO Robert Benmosche warned earnings will remain choppy as the company executes its restructuring plan.
"We continue to focus on stabilizing and strengthening our businesses, but expect continued volatility in reported results in the coming quarters, due in part to charges related to ongoing restructuring activities," Benmosche said in a statement.
Investors' initial reaction to the report is negative. Shares of AIG fell US$2.83, or 7.2 percent, to US$36.45 in premarket trading.
AIG was bailed out in September 2008 by the government as the financial crisis spiraled out of control. The insurer has received aid packages with a total value of more than US$182 billion from the government. In return for that financial support, the government received an 80-percent stake in AIG.
AIG has been working for the past year to sell assets and streamline operations in an effort to repay the government debt.
Net income available to common shareholders was US$92 million, or 68 cents per share, in the three months ended September 30 compared with a loss of US$24.47 billion, or US$181.02 per share, during the same quarter last year -- the quarter when it was initially bailed out.
Including the government's portion of the profit, AIG earned US$455 million during the latest quarter.
American International Group Inc also got a lift from the increasing value of investments it still holds that soured last year and helped drive it to the brink of collapse.
Despite the improved performance, AIG CEO Robert Benmosche warned earnings will remain choppy as the company executes its restructuring plan.
"We continue to focus on stabilizing and strengthening our businesses, but expect continued volatility in reported results in the coming quarters, due in part to charges related to ongoing restructuring activities," Benmosche said in a statement.
Investors' initial reaction to the report is negative. Shares of AIG fell US$2.83, or 7.2 percent, to US$36.45 in premarket trading.
AIG was bailed out in September 2008 by the government as the financial crisis spiraled out of control. The insurer has received aid packages with a total value of more than US$182 billion from the government. In return for that financial support, the government received an 80-percent stake in AIG.
AIG has been working for the past year to sell assets and streamline operations in an effort to repay the government debt.
Net income available to common shareholders was US$92 million, or 68 cents per share, in the three months ended September 30 compared with a loss of US$24.47 billion, or US$181.02 per share, during the same quarter last year -- the quarter when it was initially bailed out.
Including the government's portion of the profit, AIG earned US$455 million during the latest quarter.
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