The US Treasury said Monday it will sell off all of its remaining shares in insurer AIG, four years after the government laid out $182 billion to rescue the company in the financial crisis.
After steadily selling off chunks of its shareholding during the past year, the Treasury said it was putting its remaining 234 million shares on the block, but will continue to hold warrants obtained in the rescue.
After a prior sale of 637 million shares in September, the Treasury said it had turned a net profit of $15.1 billion on the money pumped into AIG, once the world’s largest insurer before it sank as one of the largest casualties of the financial crisis.
The bailout included both equity and loans from the Treasury and Federal Reserve aimed at shoring up the company, which imploded after selling hundreds of billions of dollars in under-collateralized credit default swaps to banks and investment companies.
At the time it was feared that AIG’s collapse would bring down buyers of the swaps as well, sparking a chain reaction throughout the global financial system.
But the rescue was deeply controversial, with critics saying the money put into AIG simply went toward paying off AIG’s counterparties, rather than having them take losses on their AIG-related investments.
US to sell off all shares in rescued insurer AIG
