American International Group Inc. is getting another handout from the government.
Late on Sunday, March 1, U.S. officials announced that the government would provide another $30 billion in taxpayer money to AIG. This marks the fourth time that the government has intervened, and brings AIG’s total bailout funds to $180 billion.
AIG is not expected to use the $30 billion immediately.
Officials said they thought they had no choice but to support AIG because the company’s business and trading activities are tightly intertwined with the world’s banking system. The government added that more aid may still be needed.
AIG chairman Edward Liddy said in a conference call that eliminating the need for government support will be difficult because of the unstable economy and the company’s size.
Liddy added that the company is in the process of reorganizing its main businesses into separate companies “worthy of investor confidence.”
During the same conference call, AIG chief financial officer David Herzog said, “most of the funds coming into AIG [when the government received $85 billion in cash for 80 percent of the company] were turned over to other institutions, which benefited the entire financial sector.”
The decision to allot more money to AIG came after the company reported a $62 billion net loss for the fourth quarter of 2008, bringing its total 2008 losses to $100 billion.