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| AIG considers joining lawsuit against US government over $182bn bailout | AIG considers joining lawsuit against US government over $182bn bailout |
| (about 5 hours later) | |
| AIG is considering whether to join a lawsuit against the government that spent $182bn (£115bn) to save it from collapse. | AIG is considering whether to join a lawsuit against the government that spent $182bn (£115bn) to save it from collapse. |
| American International Group said its board of directors will weigh whether to take part in a shareholder lawsuit against the US over the government's bailout of the New York-based insurer. | American International Group said its board of directors will weigh whether to take part in a shareholder lawsuit against the US over the government's bailout of the New York-based insurer. |
| If AIG decides to join the complaint, which seeks $25bn in damages, it would pit the company against the government that in 2008 kept it from buckling under the weight of huge losses on mortgage-backed securities and other toxic assets. | If AIG decides to join the complaint, which seeks $25bn in damages, it would pit the company against the government that in 2008 kept it from buckling under the weight of huge losses on mortgage-backed securities and other toxic assets. |
| AIG said that after a meeting on Wednesday, its directors should have a decision by the end of the month. | AIG said that after a meeting on Wednesday, its directors should have a decision by the end of the month. |
| Starr International, the investment firm of former AIG chief executive Maurice Greenberg, filed the lawsuit in November 2011 on behalf of the firm and AIG shareholders. | Starr International, the investment firm of former AIG chief executive Maurice Greenberg, filed the lawsuit in November 2011 on behalf of the firm and AIG shareholders. |
| The complaint, filed in the US court of federal claims and the US district court for southern New York, claims the government did not provide shareholders with fair compensation when it took a near-80% stake in the insurer as part of the bailout. In doing so, the government violated the constitution, Starr claims. | |
| AIG said that, by law, its board must consider three options: take over the lawsuit and pursue the claims on its own; attempt to prevent the claims from being pursued by Starr; or, allow Starr to continue to pursue the complaint on AIG's behalf. | AIG said that, by law, its board must consider three options: take over the lawsuit and pursue the claims on its own; attempt to prevent the claims from being pursued by Starr; or, allow Starr to continue to pursue the complaint on AIG's behalf. |
| The insurer noted that, if it decides not to let Starr pursue its claims on the company's behalf, Starr would probably challenge the move. Under that scenario, if Starr won the case, AIG would not receive any damages or portion of a potential settlement. | The insurer noted that, if it decides not to let Starr pursue its claims on the company's behalf, Starr would probably challenge the move. Under that scenario, if Starr won the case, AIG would not receive any damages or portion of a potential settlement. |
| The court of federal claims denied a request by the US to dismiss the lawsuit, which means the case will go forward regardless of AIG's participation. | The court of federal claims denied a request by the US to dismiss the lawsuit, which means the case will go forward regardless of AIG's participation. |
| The government came to the rescue of AIG in September 2008, at the depths of the financial meltdown. The New York company did business with hundreds of firms around the world, and officials feared its collapse would wreck the financial system. | The government came to the rescue of AIG in September 2008, at the depths of the financial meltdown. The New York company did business with hundreds of firms around the world, and officials feared its collapse would wreck the financial system. |
| All told, AIG's bailout was the largest of the Wall Street rescue packages. | All told, AIG's bailout was the largest of the Wall Street rescue packages. |
| Since the financial meltdown, AIG has undergone a restructuring that has cut its size nearly in half. Its aim is to focus the company on its core insurance operations. | Since the financial meltdown, AIG has undergone a restructuring that has cut its size nearly in half. Its aim is to focus the company on its core insurance operations. |
| In 2010, the company spun off Asian life insurer AIA Group in Hong Kong's biggest ever initial public offering to raise $20bn, which was used to pay bailout debt. | In 2010, the company spun off Asian life insurer AIA Group in Hong Kong's biggest ever initial public offering to raise $20bn, which was used to pay bailout debt. |
| In November, AIG reported a third-quarter profit of nearly $2bn thanks to strength in its insurance operations and investment returns. In the same period a year earlier it lost $4bn. | In November, AIG reported a third-quarter profit of nearly $2bn thanks to strength in its insurance operations and investment returns. In the same period a year earlier it lost $4bn. |
| The US treasury announced last month that it sold all of its remaining shares in AIG, ending up with $22.7bn more than it put into the company during the height of the financial crisis. | |
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