AIG announced Thursday that it had come to an agreement in principle with the U.S. Treasury, the Federal Reserve Bank of New York and the AIG Credit Facility Trust to repay outstanding obligations from its 2008 bailout.
“We are very pleased that this agreement vastly simplifies current government support of AIG, sets forth a clear path for AIG to repay the FRBNY in full, and sets in motion the steps for the U.S. Treasury to exit its ownership of AIG over time,” Robert Benmosche, president and CEO of AIG, said in a press release.
“As our results this year underscore, AIG’s core businesses are financially strong, well-managed enterprises that are well-positioned to deliver long-term value to all of our stakeholders,” he added.
According to a press release from AIG there are three phases to the agreement. First, AIG will pay off the remaining $20 billion it owes the Federal Reserve. The firm will use proceeds from the public offering of American International Assurance Company Ltd., its Asian life insurance business, and American Life Insurance Company, which MetLife in March agreed to purchase for approximately $15.5 billion.