AIG might need more money

AIG has borrowed $90.3 billion from the federal government, surpassing its original $85 billion rescue loan. American International Group Inc.’s debt is $7.4 billion more than it was last week, according to the New York Federal Reserve Bank. The government in September extended an $85 billion bridge loan to the troubled company to keep it afloat. This month, the government gave New York-based AIG access to an additional $37.8 billion. However, that may not be enough money for the insurer, according to AIG’s chief executive, Edward Liddy, who spoke on “The NewsHour with Jim Lehrer” Wednesday evening. Whether the carrier needs an additional cash injection from the federal government depends on two factors: AIG’s ability to stop the bleeding in its financial-products area and what happens in the capital markets. Falling asset values in that area are a primary reason that the company blew through its lifeline so quickly, Mr. Liddy said. “To the extent [the capital markets] continue to go down and we have to keep posting collateral, it’s possible that it may not be enough,” he said on the show. Nevertheless, Mr. Liddy said, some of the initiatives taken on by the Federal Reserve since AIG’s rescue have helped to thaw the markets and that the insurer “should be OK.”