October 27, 2008

AIG Has Borrowed $90.3 Billion

Liddy says insurer may need more than $122 billion to survive

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AIG, the giant insurer that was nationalized by the government because of its exposure to subprime mortgages, said that it has used $90.3 billion of the credit line it received from the Federal Reserve Bank in September. On October 22, AIG's government-appointed CEO, Edward Liddy, said AIG may need more than $122.8 billion to continue operations.

There were published reports that two additional U.S.-based insurers--MetLife, which reports earnings October 29, and Prudential--might seek government funds from the Treasury Department's $700 billion purse to shore up their operations.

In The Netherlands, the big insurer Aegon--parent company of TransAmerica--said it might take advantage of the Dutch government's capital injection program that ING has already tapped into.

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