Report: AIG in talks to dump toxic assets

American International Group Inc. is reportedly in talks with JPMorgan Chase & Co. to spin off some its subprime assets into a new company, according to The New York Post.
SEP 04, 2008
American International Group Inc. is reportedly in talks with JPMorgan Chase & Co. to spin off some its subprime assets into a new company, according to The New York Post. The partnership between the insurer and the investment bank, both in New York, would create a “good bank/bad bank” structure, which would allow AIG to unload some of the corrosive credit default swaps from its balance sheets, insiders told the Post. An unnamed official told the paper that the discussions between the financial giants are “very serious” and described the amount of assets AIG plans to offload as “dwarfing” the size of similar transactions performed in the past. AIG’s credit default swaps, which are linked to subprime mortgages, have dragged the firm’s earnings into the red for three straight quarters. Most recently, the insurer reported a $5.36 billion loss for the second quarter, down from $4.3 billion in profits for the same period a year earlier. AIG vigorously denied the report. “It is pure speculation, we are continuing to work on AIG’s strategic business review, expense control and reducing our financial risk. We’ll report our progress [on the review] on Sept. 25,” the firm said in a statement.

Latest News

IRA assets swell to $19.2 trillion as 401(k) rollovers drive growth
IRA assets swell to $19.2 trillion as 401(k) rollovers drive growth

IRAs now hold nearly twice the assets of 401(k) plans — and most of that money didn't arrive through annual contributions.

Women feel confident about saving, but many still keep cash in low-yield accounts
Women feel confident about saving, but many still keep cash in low-yield accounts

A new survey finds that many women prioritize financial security but continue to leave savings in accounts that may not keep pace with inflation.

SEC seeks comment on prediction-market ETFs after May pause
SEC seeks comment on prediction-market ETFs after May pause

Roundhill, Bitwise and GraniteShares funds remain on hold while the agency weighs how novel ETFs should be regulated.

Dump investment banks, buy alternative asset managers, says Oppenheimer
Dump investment banks, buy alternative asset managers, says Oppenheimer

"Shares of alternative assets managers have lagged this year as investors grow wary of private-credit exposure."

TaxStatus rolls out rules-based tool to flag advice gaps
TaxStatus rolls out rules-based tool to flag advice gaps

The fintech platform is touting a new AI-free Planning Observations feature, which draws on IRS tax records to uncover opportunities for advisors.

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income

SPONSORED Why direct indexing stopped being optional

Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.