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Fitch may cut AIG debt ratings from 'AA-minus'

NEW YORK
Fri Aug 22, 2008 6:01pm EDT

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NEW YORK (Reuters) - Fitch Ratings on Friday said it may cut its ratings on American International Group Inc (AIG.N), citing uncertainty over the outcome of AIG's review of its businesses.

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The review also reflects the risk of additional realized and unrealized losses from the insurer's exposure to residential mortgage-backed debt, Fitch said in a statement.

Fitch currently rates AIG "AA-minus," the fourth highest investment grade.

AIG Chief Executive Robert Willumstad said earlier this month that he will unveil a plan to dramatically reshape the company, at an investor meeting on Sept. 25. AIG posted a second-quarter loss of $5.36 billion.

"Completion of AIG's review of its various business units will likely provide clarity around some of its rating concerns over the next four to six weeks," Fitch said.

Clarity relating to AIG's exposure to credit volatility, however, will take a longer period of time and may extend over the next two quarterly reporting periods, the rating agency added.

(Reporting by Karen Brettell; Editing by Leslie Adler)
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