U.S. could make $15.1 billion on AIG bailout: GAO

WASHINGTON Tue May 8, 2012 12:54am EDT

A man walks past the American International Group (AIG) building in New York's financial district. REUTERS/Brendan McDermid

A man walks past the American International Group (AIG) building in New York's financial district.

Credit: Reuters/Brendan McDermid

WASHINGTON (Reuters) - Taxpayers could realize a profit of more than $15.1 billion from the massive government bailout of insurer American International Group, a congressional watchdog said.

According to a report by the Government Accountability Office issued on Monday, the total return depends on the overall health of AIG and a number of other factors relating to Treasury's ownership stake.

The U.S. Treasury acquired shares in AIG as part of a $182 billion bailout of the insurer in 2008, the largest rescue of a single corporation, and has reduced the investment over time.

Treasury sold AIG common stock in May 2011 and this March. Another sale on Monday - that realized $5.8 billion - reduced taxpayer equity interest in AIG to 61 percent.

The AIG portfolio includes a Federal Reserve Bank of New York loan to Maiden Lane III of about $8 billion, which the GAO analysis expects to be repaid in full and net additional returns.

"When all the assistance is considered, the amount the federal government ultimately takes in could exceed the total support extended to AIG by more than $15.1 billion," GAO found.

(Reporting By John Crawley; editing by Mohammad Zargham)

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Comments (4)
jackbnimble2 wrote:
The republicants will probably reply to this news by whining that it should have been $20B.

May 08, 2012 1:40am EDT  --  Report as abuse
whyknot wrote:
AIG the insurer of toxic mortgages paid off the banks foreign and domestic and got taxpayer money to do it. Finally AIG pays some back manwhile the banks continue to foreclose on the taxpayers who bailed them out.

May 08, 2012 3:08am EDT  --  Report as abuse
Dashburn wrote:
Bogus accounting gimmick. Let us not forget the $5 trillion we have borrowed and spent trying to prop up this failed economy. All things considered, I would say the government has gotten a pretty poor return on its investment.

May 08, 2012 3:17pm EDT  --  Report as abuse
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