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AIG Posts Profit for Q1

Posted on 07 May 2010

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American International Group Inc. (AIG) posted profit for the third time in the past four quarters as write-downs narrowed and investment income climbed.

In a statement today, the insurer said that first-quarter net income of $1.45 billion, or $2.16 a share, compares with a loss of $4.35 billion, or $39.67 a year earlier. AIG opted for the first time in four quarters against extending the period in which it is committed to supporting plane-leasing and consumer- lending units, citing their renewed access to private funding.

Chief Executive Officer Robert Benmosche has said AIG is “now on a path” to repaying loans in the insurer’s $182.3 billion rescue after announcing deals in March to sell two life divisions for about $51 billion. Results have stabilized at AIG’s remaining insurance units and the New York-based company may recover by year-end from junk status assigned to its stand- alone credit, Standard & Poor’s said last month.

“We’re seeing a stabilization at AIG,” said Robert Haines, an analyst at CreditSights Inc. in New York. “They are generating some internal cash flow for a change. That will be essential to paying the government back.”