Q: Were AIGFP and the AIG Insurance Companies Connected?
- A disorderly failure of AIG clearly would have placed additional pressures on, and magnified the risks facing, AIG's insurance subsidiaries.
- For example, AIG's insurance subsidiaries had substantial derivatives exposures to AIGFP and were interconnected with the parent company and its unregulated affiliates in a variety of other financial and operational ways. -
2010 0119 - Federal Reserve (Bernanke) to GOV (Senators Dodd and Shelby) - [link-666p]
- AIGFP / SunAmerica - GICs
- AIGFP / Securities Lending
- AIGFP / Loan from AGC Life insurance Company (Missouri, Texas?) to AIGFP
- OTS Report
GICs are issued out of AlG-Financial Products (AlG-FP), insured by the holding company.
- downgrade by 1 rating agency leads to $10B in collateral calls, plus an additional $4B-$5B in portfolio obligations that are puttable if downgraded (total of $15B in liquidity needs)
- downgrade by 2 rating agencies - additional $3B in liquidity needs.
- If downgraded, they must post half of the additional collateral within 2 days, and the other half in 10 days.
2008 0912 - FRBNY / AIG Meeting Notes - 2p