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Financial Planning > Tax Planning > Tax Loss Harvesting

Earnings: AIG, Conseco, American Equity, Pan-American

By staff Writer

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American International Group Inc. (NYSE:AIG) has reported a large loss for the fourth quarter of 2009, but the domestic life and retirement business took in more deposits and is reporting a pre-tax profit.

American International Group Inc., New York (NYSE:AIG)

4 Q 2009 Results
NET INCOME: $9 billion loss
OTHER-THAN-TEMPORARY INVESTMENT LOSSES ON SECURITIES AVAILABLE FOR SALE: $916 million loss
OTHER REALIZED CAPITAL CHANGES: $900 million gain
UNREALIZED MARKET VALUATION CHANGE ON AIG FINANCIAL PRODUCTS SUPER SENIOR CREDIT DEFAULT SWAPS PORTFOLIO: $2.2 billion gain
REVENUE: $24 billion

4 Q 2008 Results
NET INCOME: $63 billion loss
OTHER-THAN-TEMPORARY INVESTMENT LOSSES ON SECURITIES AVAILABLE FOR SALE: $17 billion loss
OTHER REALIZED CAPITAL CHANGES: $6.1 billion loss
UNREALIZED MARKET VALUATION CHANGE ON AIG FINANCIAL PRODUCTS SUPER SENIOR CREDIT DEFAULT SWAPS PORTFOLIO: $9.5 billion loss
REVENUE: Negative $24 billion

AIG DOMESTIC LIFE AND RETIREMENT

4 Q 2009 Results
PREMIUMS, DEPOSITS AND OTHER CONSIDERATIONS: $5.4 billion
OPERATING INCOME BEFORE NET REALIZED CAPITAL CHANGE: $1 billion
NET REALIZED CAPITAL CHANGE: $364 million loss
PRETAX NET INCOME: $670 million

4 Q 2008 Results
PREMIUMS, DEPOSITS AND OTHER CONSIDERATIONS: $5.1 billion
OPERATING INCOME BEFORE NET REALIZED CAPITAL CHANGE: $835 million loss
NET REALIZED CAPITAL CHANGE: $14 billion loss
PRETAX NET INCOME: $15 billion loss

- AIG is including $141 million in other-than-temporary impairment losses in “other comprehensive income” rather than including it in net income.

- Total domestic life and retirement assets under management increased 7.7%, to $231 billion.

- Domestic life sales and deposits fell to $531 million in the fourth quarter, down from $789 million in the fourth quarter of 2008. But sales of variable universal life increased more than 12%, to $9 million. The unit’s sales of fixed, runoff and payout annuities fell about 23%, to $430 million.

-Domestic retirement unit premiums, deposits and other considerations from individual fixed annuities increased 54%, to $1.9 billion.

- The foreign life and retirement business is reporting $1.3 billion in pretax income for the quarter, up from a $3.4 billion loss for the fourth quarter of 2008.

***

Other recent earnings reports:

Conseco Inc., Carmel, Ind. (NYSE:CNO)

4 Q 2009 Results
NET INCOME: $18 million
OTHER-THAN-TEMPORARY INVESTMENT LOSSES: $61 million loss
REVENUE: $1.1 billion

4 Q 2008 Results
NET INCOME: $453 million loss
OTHER-THAN-TEMPORARY INVESTMENT LOSSES: $45 million loss
REVENUE: $1 billion

- Conseco is including $30 million in other-than-temporary impairment losses in “other comprehensive income” rather than including it in net income.

- New annualized premium revenue, or revenue from new sales, increased 28% at the Bankers Life career distribution unit, to $93 million, and 4% at the Conseco Insurance Group unit, to $19 million. Sales through the Colonial Penn direct distribution unit fell 22%, to $8.4 million.

American Equity Investment Life Holding Company, West Des Moines, Iowa (NYSE: AEL)

4 Q 2009 Results
NET INCOME: $36 million
CHANGE IN FAIR VALUE OF DERIVATIVES: $109 million gain
OTHER-THAN-TEMPORARY INVESTMENT LOSSES: $49 million loss
REVENUE: $385 million

4 Q 2008 Results
NET INCOME: $24 million loss
CHANGE IN FAIR VALUE OF DERIVATIVES: $56 million loss
OTHER-THAN-TEMPORARY INVESTMENT LOSSES: $98 million loss
REVENUE: $91 million

- American Equity is including $26 million in other-than-temporary impairment losses in “other comprehensive income” rather than including it in net income.

- “Sales conditions for index annuities were very favorable throughout 2009, due to equity market declines and low interest rates on competing products such as bank certificates of deposit,” the company says. “Index annuities provide guaranteed principal, minimum interest and account value, as well as guaranteed retirement income for life.”

- American Equity says some key competitors in the index annuity market “reduced the amount of new sales they were willing to receive.” But it expects “several competitors” to resume accepting a higher level of sales.

- American Equity believes it accounted for 12% of all U.S. index annuity sales in the fourth quarter.

Pan-American Life Insurance Group Inc., New Orleans, La.

4 Q 2009 Results
NET INCOME: $26 million
REVENUE: $423 million

4 Q 2008 Results

NET INCOME: $6.2 million
REVENUE: $401 million

- Pan-American says “overall expense control” contributed to the increase in net income.

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