Remember the dark days of 2008 when insurer American International Group Inc., better known as AIG, nearly collapsed under the weight of the mortgage crisis before Washington rode to the rescue to the tune of $182 billion?
Then there was the public outrage when AIG executives got millions in bonuses after receiving the largest of all of the Wall Street bailouts.
Since then, the New York-based insurance giant has been essentially a government-owned enterprise, with Uncle Sam holding a controlling share.
But that's about to change. In four tranches in recent months, the government has sold off shares in AIG for $23.3 billion, reducing its stake from 92 percent. When the latest sell-off is complete, the government stake will go down from about 53 percent to just 23 percent.
"The U.S. needs to average about $28.73 on the sales to break even on the stake it acquired as part of the bailout, excluding unpaid dividends and fees, according to the Government Accountability Office. The first two offerings were priced at $29 a share, and the second two at $30.50 apiece. ...
"AIG is the last U.S. insurer that hasn't yet ended its bailout. The government has already divested its holdings in most of the largest U.S. banks including Citigroup Inc. and Bank of America Corp. while retaining a majority stake in Ally Financial Inc."
The Associated Press says AIG "has sold off several different units in order to raise money to pay off its debt to the government."
"The insurer has been profitable the last two years and is expected to post a net profit of $7.4 billion in the year through this December. CEO Robert Benmosche said last month the company was close to its goal of repaying the government everything it provided to AIG during the financial crisis 'plus a profit.' "