The US Treasury Department said it will sell most of its stake in American International Group, making the government a minority investor for the first time since it rescued the insurer in the depths of the financial crisis in 2008.While the Treasury was universally expected to sell stock this month, the magnitude of the US$18 billion (HK$140.4 billion) offering was a surprise that will take the government stake in what had been the world's largest insurer to about 20 percent from 53 percent.
The sale will trigger changes for AIG. The most important is that it will now fall under Federal Reserve regulation as a savings and loan holding company, since it owns a small bank.
AIG said it would buy up to US$5 billion of the offering. Last week, the company sold part of its stake in the Asian insurer AIA (1299) to help fund that buyback.
AIA chief marketing officer Thomas Lee Mun-nang yesterday warned growth of the insurer's new business value slowed down in the first half.
REUTERS
