• Most Popular
  • Most Shared

NY Fed hosting meetings on AIG: official

WASHINGTON
Mon Sep 15, 2008 2:23pm EDT
A security guard greets workers outside the AIG headquarters in New York's financial district September 15, 2008. Shares of American International Group fell more than 50 percent in early trading on reports that the insurer had turned to the Federal Reserve for $40 billion in bridge financing to ward off a liquidity crisis and ratings downgrades. REUTERS/Brendan McDermid

WASHINGTON (Reuters) - The New York Federal Reserve was hosting meetings on Monday on the situation of embattled insurer American International Group Inc with representatives of the Treasury Department, financial services firms and state officials, an official said on Monday.

"At the request of AIG and a consortium of financial institutions, we are providing premises to discuss the situation," a New York Fed spokesman said.

The New York Fed has been "in touch" with the office of New York Gov. David Paterson, but the spokesman declined to comment on details of the contacts.

Paterson said state officials have reached a deal that would allow the insurer to access $20 billion of its own capital by shifting funds from insurance subsidiaries to the parent company.

Paterson also said New York State Insurance Superintendent Eric Dinallo has asked the federal government to provide additional funding to AIG, which employs 8,500 people in New York.

A source told Reuters the New York Fed has hired Morgan Stanley to review options regarding AIG.

The Fed and the Treasury Department declined to comment.

(Reporting by Mark Felsenthal and David Lawder; Additional reporting by Joseph Giannone in New York; Editing by Dan Grebler)


More from Reuters

Photo

East Coast tunnels out from severe snowstorm

NEW YORK (Reuters) - The Northeast began digging out on Sunday from a massive snowstorm that buried cities from Washington to Boston under as much as two feet of snow, creating travel chaos and hampering Christmas shopping. | Video

» More Top News
A woman shops at a Sam's Club store, a division of Wal-Mart Stores, in Bentonville, Arkansas June 4, 2009. REUTERS/Jessica Rinaldi

The food-stamp economy

On the last day of every month, shoppers at Walmart load their carts with food and household items and wait for the midnight hour. Is this the new normal in America?  Full Article 

U.S.
Two men shake hands in a file photo. REUTERS/File

Let's make a deal

The battered M&A sector will make a tepid recovery in the coming year and three hot sectors will lead the way, according to a Thomson Reuters analysis.  Full Article 

Global Deals Review