AIG - American International Group

[theando]

http://dl.dropbox.com/u/32606407/WFC%20AIG%20Upgrade%20041012.pdf  Here you go.

[vinod1]

http://dl.dropbox.com/u/32606407/WFC%20AIG%20Upgrade%20041012.pdf  Here you go.

 

Thank you!

[vinod1]

http://dl.dropbox.com/u/32606407/WFC%20AIG%20Upgrade%20041012.pdf  Here you go.

 

Some creating thinking here..

 

What else is there? How about a share repurchase funded with value represented by AIG’s deferred tax

assets? AIG is in an extraordinarily unusual situation. The company has substantial net deferred tax assets

(DTA) of $16.6 billion on its balance sheet and the company’s majority owner is the US Government via the US

Treasury. While many companies have DTA, few of them are effectively owned by the government. IRS rules

make DTA’s notoriously difficult to transfer to third parties. But for AIG, we believe the company’s DTA, as a

claim against future tax revenues, represents a form of value to AIG’s majority owner – the US government.

Food for thought: why can’t AIG place a present value on its DTA and use it as a store of value to repurchase

its shares from the US Government?

[CONeal]

Bruce B suggested this idea last year (using the tax assets to buyout the gov't).  For one reson or another it didn't go anywhere.

[PlanMaestro]

Marsh: price increases of up to 10 percent in the first quarter

 

http://www.cnbc.com/id/47006744

 

Just in the United States, customers without significant exposure to natural catastrophes saw price increases of up to 10 percent in the first quarter, while those in disaster-prone areas paid rates up to 20 percent higher than their last contract, the Marsh & McLennan Cos. unit said.

[PlanMaestro]

AIG Is Planning a Return to U.S. Property Investing

 

http://online.wsj.com/article/SB10001424052702304587704577335963793848928.html

 

The company once acquired flashy properties like a Vermont ski village, Shanghai office towers and a Tokyo shopping mall. This time, a humbled AIG has set its sights lower: The U.S. apartment market is where it is focusing now, said people familiar with the matter.

[racemize]

seems pretty odd--I liked it better when they were simply getting down to core businesses and buying back shares...

[PlanMaestro]

seems pretty odd--I liked it better when they were simply getting down to core businesses and buying back shares...

 

I worked for the investment department of an insurance company. AIG needs to keep investing in their life and P&C subsidiaries (while being adequately capitalized). They can use excess capital distributed as dividends and all the non-core assets but the rest needs to keep the insurance subs going. Now, if they are planning on starting a Real Estate division it would be a bad signal.

[Rabbitisrich]

This is no big deal. As the article stated, AIG already returned to securities lending which was a major factor in its collapse. At least the focus on apartments implies a cash flow focus rather than a capital appreciation strategy (well, maybe).

 

 

[gokou3]

Deutsche Bank, Barclays Said to Prepare Maiden Lane Bids

http://www.bloomberg.com/news/2012-04-12/deutsche-bank-barclays-said-to-prepare-maiden-lane-bids.html

 

It will probably take several weeks to select the winning bid, said the people, who declined to be identified because the process isn’t public.

 

That's around the time when the UST's 60-day lockup from the last share sale expires.

[PlanMaestro]

Here comes the usual Buffett rumor

 

http://www.streetinsider.com/Rumors/AIG+(AIG)+Rips+On+Buffett+Rumor/7341565.html

 

[PlanMaestro]

Details on ML III and the sale process

http://www.ft.com/intl/cms/s/0/9ed8a08a-84aa-11e1-b6f5-00144feab49a.html#axzz1rsB5uVlt

 

The appeal for banks and investors is not the “tranches” in the CDOs, but the chance to obtain the underlying collateral, either commercial real estate bonds or other asset-backed debt. “These CDOs, you may be able to collapse them and typically the pieces trade for more than the value of the whole,” said Mayer Cherem of Paamco, a funds of funds.

 

(...)

 

Maiden Lane III, through a loan from the New York Fed and money from AIG, bought parts of the CDOs from AIG’s counterparties in return for cancelling credit default swaps that the insurer has sold on the deals. Including collateral AIG had already posted with counterparties, they received 100 cents on the dollar for the securities.

 

 

 

 

 

 

 

[PlanMaestro]

AIG life unit reorganizes, sales under one umbrella

http://uk.reuters.com/article/2012/04/12/aig-idUKL2E8FB9BC20120412

 

 

The business has seen a turnaround since the financial crisis, particularly as major brokers began to sell its products again. To accelerate that improvement, SunAmerica said it would set up SunAmerica Financial Group Distributors, unifying its various sales teams and account executives.

 

SunAmerica Chief Executive Jay Wintrob, in an interview, said bringing together sales teams would let the life insurer cross-sale to corporate clients in a way that it is not doing currently.

 

"I like to say we're just back to the starting gate," Wintrob said of the company's recovery. "In many cases we're just in those firms with one of our various products."

 

SunAmerica also said it would set up an institutional products unit to manage various specialty lines like structured settlements, corporate-owned life insurance and something called "pension terminal funding," where companies shutting their pension plans transfer their liabilities to insurers.

 

That last product in particular is one that AIG is targeting, especially as more companies confront huge retirement obligations in a weak economy.

 

"We see that as potentially quite a growth market so we've decided to commit additional resources," he said. "We think it's going to be big and it's going to be quite profitable."

 

Jonathan Novak, who worked in risk management for Goldman , will join SunAmerica to run that business.

 

 

[PlanMaestro]

AIG’s Wintrob Sees No Curbs on Bidding for Hartford Units

http://www.bloomberg.com/news/2012-03-22/aig-s-wintrob-sees-no-curbs-on-bidding-for-hartford-units.html

[PlanMaestro]

Old Golub interview providing his view of AIG and Benmosche

http://www.bloomberg.com/video/66227768/

[Olmsted]

Here comes the usual Buffett rumor

 

http://www.streetinsider.com/Rumors/AIG+(AIG)+Rips+On+Buffett+Rumor/7341565.html

 

I get the whole "Buffett seal of approval" idea, but really, why in the world do people fantasize about Buffett buying the government's stake?  So he can make a lot of money?  I want AIG to buy the as much of the government's stake as possible, as cheaply as possible, so I can make a lot of money!

 

If Buffett or any other large player were to get their hands on a big chunk of the government's shares, I would view that as neutral news at best.

[nkp007]

Best case scenario: AIG uses  the next 5 yrs of excess cash flow to buy back shares at ~today's prices.

 

Second-best case scenario: A massive, credible investor buys a huge stake in AIG. Everyone and their mother piles in over the next year and price quickly reaches our range of fair value.

[mankap]

I would like AIG to buyback with Maiden Lane,AIA and ILFC money first before Govt sells the shares to Buffett or anyother investor.

[PlanMaestro]

Steve Miller, Cheerleader in Chief

Preview of Bloomberg interview to run on April 23

 

Video Preview: http://www.bloomberg.com/video/90599259/

Report: http://www.bloomberg.com/news/2012-04-13/aig-s-miller-says-u-s-exit-could-be-done-within-12-months-1-.html

 

 

“It will be Treasury’s choice as to when they want to liquidate those shares. But it is certainly within the realm of possibility that it could happen within the next 12 months.”

 

[PlanMaestro]

More on the complications of selling ML III

 

http://www.reuters.com/article/2012/04/13/maidenlane-cdos-idUSL2E8FDHV520120413?feedType=RSS&feedName=rbssFinancialServicesAndRealEstateNews&rpc=43

[berkshiremystery]

Credit Suisse Paid $6.8 Billion for AIG’s Home-Loan Bonds

 

http://www.bloomberg.com/news/2012-04-16/credit-suisse-paid-6-8-billion-for-aig-s-home-loan-bonds.html?cmpid=yhoo

 

 

Credit Suisse, Goldman Sachs Buy Maiden Lane Assets

 

http://online.wsj.com/article/SB10001424052702304299304577347693066661410.html?ru=yahoo&mod=yahoo_hs

 

 

 

[Olmsted]

I would like AIG to buyback with Maiden Lane,AIA and ILFC money first before Govt sells the shares to Buffett or anyother investor.

 

Exactly. 

 

NKP - good point.  Anybody buying the government stake would be a catalyst.  I like quick, even if partial, value realization. 

 

[berkshiremystery]

A good new article about AIG at SeekingAlpha.com:

 

AIG - Undervalued And Misunderstood

April 17th, 2012

 

http://seekingalpha.com/article/503611-aig-undervalued-and-misunderstood?source=yahoo

 

 

[BargainValueHunter]

God bless election year wrapping up of "loose ends"!

 

http://www.forbes.com/sites/steveschaefer/2012/04/18/ny-fed-requests-bids-for-piece-of-last-portfolio-from-aig-bailout-maiden-lane-iii/

 

The New York Fed said it received several reverse inquiries for the “MAX CDO” holdings of Maiden Lane III and directed BlackRock, which has been managing the Maiden Lane portfolios, to invite “all-or-none” bids by an April 26 deadline, from eight broker-dealers: Barclays Capital, Citigroup Global Markets, Credit Suisse Securities (USA), Deutsche Bank Securities, Goldman Sachs, Merrill Lynch Pierce, Fenner & Smith (part of Bank of America), Morgan Stanley and Nomura Securities International.

 

The group of invited bidders firms that have made previous reverse inquiries on other Maiden Lane assets and some that acquired pieces of the portfolio, such as Goldman and Credit Suisse.

 

Largely backed by commercial real estate bonds, the MAX CDOs represent around $7.5 billion in face value of the Maiden Lane III portfolio’s total face value of approximately $45 billion, though that offers little in the way of signals to what the Fed might receive and the price of any resulting transaction will not immediately be revealed.

 

Nice to see BAC getting in on this...

 

 

[mankap]

Citi,Goldman and Credit Suisse plan to make a combined bid for Maiden Lane 3.We are getting closer and if all goes well, AIG can see Maiden Lane 3 money pretty soon.

 

http://www.reuters.com/article/2012/04/23/fed-maidenlane-banks-idUSL2E8FN4M820120423?type=companyNews&feedType=RSS&feedName=companyNews&rpc=43

 

Citigroup, Goldman and Credit Suisse plan to make a combined bid to purchase the assets of Maiden Lane III, a portion of the risky assets the Federal Reserve acquired when bailing out insurance giant American International Group in 2008, according to people familiar with the plan.

 

The New York Fed last Wednesday said it invited eight investment banks to submit bids for the commercial mortgage-backed securities, "in response to several reverse inquiries" for the assets.

 

The three banks plan to work together to make a combined bid for the securities on April 26, the people said on Monday.

 

BlackRock Solutions, the investment manager for the Maiden Lane portfolio, will conduct a bid process for the bonds, with all bids due on April 26, though there is no fixed timetable for any sales, the Fed said.

 

Citi, Goldman and Credit Suisse plan to submit their combined bid at 10 am on April 26, sources familiar with the plan said.

 

Other banks invited to bid on the assets include Barclays Capital, Bank of America's Merrill Lynch broker , Deutsche Bank, Morgan Stanley and Nomura.