AIG Taiwan says operations normal amid Fed loan
TAIPEI, Sept 22 (Reuters) - American International Group's (AIG.N) Taiwan life insurance operations remain normal and its clients unaffected despite issues being faced by the parent company, the Taiwan unit said in a statement on Monday.
Nan Shan Life Insurance Co., AIG's Taiwan life insurance business, said a $85 billion loan granted to its parent by the Federal Reserve would help AIG become a healthier group, Nan Shan said in an announcement in major Taiwan newspapers.
"I and the entire staff of Nan Shan will continue our commitments to our clients as we have been," it said, quoting Nan Shan's president.
The statement came as the U.S. firm said last week it expected proceeds of asset sales to be sufficient to repay the loan in full and its businesses to continue as "substantial participants" in their respective markets. [ID:nWEN8233]
Nan Shan, which competes with industry leaders Cathay Financial (2882.TW) and Shin Kong Financial (2888.TW), also said last week its parent had no plan to sell Nan Shan, responding to market talks some major private equity funds were interested in acquiring the company.
Troubles at U.S.-based AIG, much like those of some of its Wall Street peers, stem from guarantees it wrote on mortgage-linked derivatives that have left it with a total of $18 billion in losses over the past three quarters. [ID:nLG244568]
Shares of Cathay, Shin Kong and other Taiwan financial firms were hit hard by the U.S. financial turmoil, which in part was triggered by the collapse of Lehman Brothers and troubles of AIG. Taiwan financial firms and retail investors had about $2.5 billion worth of investments in Lehman products, the island's top financial regulator said recently. ($1=T$32.1) (Reporting by Faith Hung; Editing by Nick Macfie)
