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August 14, 2009 at 08:00 PM
Despite American International Group’s recent profitable quarter, Moody’s Investors Service said its outlook remains negative and it has doubts about the company’s ability to fully repay the government.
Only partial repayment “is a real possibility,” said Moody’s analyst Bruce Ballentine.
The rating firm said it maintains the long-term issuer rating of A3 and short-term issuer rating of Prime-1 because of a negative outlook following AIG’s second-quarter report showing its first quarterly profit since that third quarter of 2007.
AIG’s two largest business segments, general insurance and life insurance & retirement services, have experienced significant declines in business volumes and operating income over the past year, Moody’s noted.
However, both segments showed signs of stabilization or slight improvement in this year’s second quarter compared with the first three months of the year, it noted.
