Posted on 16 Mar 2009
Societe Generale of France and Deutsche Bank AG of Germany led a group of 20 foreign and U.S. banks that received billions of dollars in collateral payments after the AIG rescue by the Federal government.
Goldman Sachs Group Inc., Merrill Lynch & Co. and France’s Calyon, were also among recipients of $22.4 billion, AIG said as it released the list for the first time on Sunday. AIG had previously said collateral recipients couldn’t be named because of confidentiality requirements.
“The American people have the right to know how AIG is using taxpayer dollars and how those funds are helping to stabilize the global financial system,” Isaac Baker, a Treasury spokesman, said in a statement today. The bailout was valued at $160 billion as of March 2, a Federal Reserve official said.
“Our decision to disclose these transactions was made following conversations with the counterparties and the recognition of the extraordinary nature of these transactions,” Liddy said in a statement.
Spokespeople for the U.S. and European banks named by AIG either declined to comment or couldn’t be reached for comment.
The collateral payments were made from the government’s initial $85 billion emergency loan to AIG, the New York-based insurer said in a statement. As the value of the credit-default swap portfolio fell, it triggered collateral provisions creating a “liquidity crisis” for AIG.
AIG’s disclosure comes after consultation with the Federal Reserve and is intended to provide transparency around the use of government funds, the statement said. The company’s fourth-quarter loss of $61.7 billion was the biggest ever recorded for any U.S. company, and AIG considered seeking court protection before accepting the U.S. rescue in September.
“We commend the company for finding a balance between its concerns with confidentiality and the concerns of the public interest that may be served through the release of this information,” a Fed spokesperson said in a prepared statement.