Goldman to respond to coverage of AIG bailout

NEW YORK (Reuters) - Goldman Sachs Group Inc said it will respond on Friday to what it calls "misperceptions" about its trading relationship with bailed-out insurance company American International Group.

For weeks, Goldman has been under fire amid disclosures that more than $90 billion of taxpayer funds earmarked for the rescue of AIG, which nearly collapsed under credit derivative losses, were quickly paid out to U.S. and European banks that had purchased credit protection from AIG.

Under growing pressure to reveal more about its trading partners, AIG on Sunday detailed how much it paid out to various banks. Goldman was the largest single recipient of AIG bailout funds with $12.9 billion.

In a statement on Thursday, Goldman said Chief Financial Officer David Viniar would host a conference call with reporters to "clarify certain misperceptions in the press regarding Goldman Sachs' trading relationship with AIG."

Goldman officials were not immediately available to comment on the press call.

Critics in recent weeks have claimed that Goldman, whose alumni populate the halls of government, benefited unfairly from political connections and favoritism.

Henry Paulson, Treasury Secretary when the initial bailout was arranged last fall, had been chief executive of Goldman.

The chairman of the Federal Reserve Bank of New York is former Goldman Chairman Steve Friedman.

Goldman has insisted it did not need any bailout because it was "always fully collateralized and hedged." The bank also says it was not party to any discussions about a government bailout of AIG.

In an interview earlier this week, Goldman spokesman Michael DuVally told Reuters "our notional exposure to AIG is a fraction of what it was at the time of the September bailout."

Asked why Goldman accepted the $12.9 billion, DuVally said that because AIG was rescued by the government, Goldman did not receive money from hedges that would have been paid had the insurer collapsed. Under the terms of its contracts with AIG, Goldman said it was entitled to collateral.

Goldman is hardly alone. Other AIG counterparties that indirectly received U.S. funds included France's Societe Generale with $11.9 billion, Deutsche Bank with $11.8 billion and Barclays with $8.5 billion.

AIG's disclosure did not include payments since December 31.

These payments to banks have sparked outrage in Congress and among investors who complain AIG's trading counterparties were bought out at par value.

(Editing by Phil Berlowitz)