American International Group Inc. says strong demand helped it overcome investment market turmoil and raise more capital than it had expected.

AIG, New York, says it has completed raising $20 billion through the sale of common stock, equity units and fixed-income securities.

Originally, AIG had suggested that it might raise $12.5 billion, to cope with exposure to turmoil in the mortgage market and other credit markets.

The fixed-income securities included $4 billion of junior subordinated debentures that pay an interest rate of 8.175%; the equivalent of $1.2 billion in junior subordinated debentures in euros, which pay an interest rate of 8%; and the equivalent of $1.75 billion in junior subordinated debentures in U.K. pounds, which pay an interest rate of 8.625%, AIG says.

Moody’s Investors Service, New York, welcomed news of the efforts to raise capital, and it also noted that AIG may lose less on residential mortgage-backed securities and collateralized debt securities than current market value estimates would indicate.

But Moody’s cut the ratings of AIG’s senior unsecured debt to Aa3, from Aa2.

Standard & Poor’s Ratings Services, New York, held the counterparty credit rating it has assigned to AIG steady at AA minus.

AIG’s successful effort to raise capital “restores the firm to a very strong consolidated capital position,” S&P says.