AIG - Commercial Paper

  • 2008 1030 - Reuters - AIG units to participate in commercial paper program - [link]
    • AIG Funding Inc, International Lease Finance Corporation, Curzon Funding LLC and Nightingale Finance LLC may issue up to $20.9 billion of commercial paper under the New York Fed’s program.
  • (p61) - AIG found itself unable to obtain short-term or long-term financing in the public debt markets.
  • This, coupled with its inability to roll over commercial paper coming due, posed the most significant immediate threat to the company‟s solvency.201 

201 AIG Form 10-K for FY08, supra note 47, at 201.

2010 0610 - COP - The AIG Rescue, Its Impact on Markets, and the Government’s Exit Strategy - 337p

  • Financing activity cash flows indicate the extent to which a company uses the capital markets for equity and debt financing such as issuing its stock, bonds, and commercial paper to investors and obtaining bank loans and other forms of bank credit.

2011 07 - GAO - Troubled Asset Relief Program: The Government’s Exposure to AIG Following the Company’s Recapitalization - 97p

  • 2007 0611 - OTS - Office of Thrift Supervison Holding Company Report Of Examination of AIG - 52p
    • (p26) ...commercial paper issued by AIG Funding, Inc. ($4.2 billion).

  • 2010 0526 - COP - Hearing - TARP and Other Government Assistance for AIG - [PDF-241p
    • (p218) - Jim Millstein (Chief Restructuring Officer, U.S. Department of the Treasury):
      • All of the contracts at AIGFP are guaranteed by the parent.
        • The parent has a $100 billion dollar balance sheet of its own.
      • On September 8th of 2008, with $15 billion dollars of commercial paper, we all know what happened to Lehman Brothers, to the commercial paper markets after Lehman Brothers filed and defaulted on $5 billion dollars of commercial paper.
      • Fifteen billion dollars of commercial paper at the parent company.

(p37 / 90) - 7.6 The Freezing of Commercial Paper Markets Meant That AIG Was Not Able to Roll Over Its Commercial Paper as It Became Due.

  • (a) “On September 12, 2008, two of AIG’s non-insurance subsidiaries, International Lease Finance Corporation (‘ILFC’) and American General Finance (‘AGF’) were unable to roll over their commercial paper.
    • As a result, AIG advanced loans to these subsidiaries to meet their commercial paper obligations.” (Agreed to Stipulations ¶ 74).
  • (b) On September 12, AIG “had difficulty rolling its commercial paper programs” and believed it would “face pressure to roll its commercial paper facilities on Monday, September 15th”. (DX 296 at -683 to -684; see also DX 1503 at -917 (“since mid September there has been no capacity to issue commercial paper”)).
  • (c) Herzog: “if we weren’t able to roll the commercial paper, we . . . had to basically refund the cash”. (Herzog: Trial Tr. 7031:23 – 7032:8).

2015 - LC - Starr International Company, Inc. v. The United States - Case 1:11-cv-00779-TCW - Document 428 Filed 02/19/15 Page 81 of 573 - 573p