AIG Needs $38 Billion More
We just loaned them $85 Billion. But that wasn’t enough.
Everyone. Together now. “I told you so!”
The Federal Reserve announced Wednesday it was lending billions of additional funds to cash-strapped American International Group Inc.
Under the program, the New York Federal Reserve Bank will provide $37.8 billion in additional cash to certain domestic life insurance subsidiaries of AIG in return for investment-grade, fixed-income securities.
AIG already has an $85 billion line of credit with the Fed. As of last week, AIG had used $60 billion of this loan, according to Fed data.
This new program will allow AIG to replenish liquidity, the Fed said. At the same time, the securities will provide enhanced protection to U.S. taxpayers, the central bank said.
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