Q: Could AIG Have Separated AIGFP from the Insurance Companies?

  • 2009 1231 - Examination Report of AIG - AGC Life Insurance Company - Missouri - 25p
  • Hank Greenberg (Former AIG CEO)
    • 2009 0402 - GOV (House - Oversight and Reform) - The Collapse and Federal Rescue of AIG and What It Means for the U.S. - PDF-87p
  • Terri Vaughan (NAIC-CEO) / Carolyn Maloney - (D-NY)
    • 2009 0305 - GOV (House) -  Perspectives on Systemic Risk - (Part 1 of 2) - PDF-254p
  • Hank Paulson (Former Secretary of the Treasury) / Blaine Luetkemeyer (R-MO) 
    • 2010 0127 - GOV (House) - The Federal Bailout AIG - PDF-652p
  • Geithner (Secretary of the Treasury)
    • 2011 1119 - GOV (JEC) - Financial Regulatory Reform: Protecting Taxpayers and the Economy - PDF-61p
  • Eric Dinallo (Former New York State Superintendent of Insurance)
    • 2021 - YPFS Lessons Learned Oral History Project: An Interview with Eric Dinallo - 19p
  • (p48) - Mrs. MALONEY (D-NY):  Why do we not just separate out this risky arm as Hank Greenberg said, who should know, he is the former CEO, he said just separate it out and let that be over in one area and let the insurance be strong and serving the public. Dr. Vaughan?
  • Ms. VAUGHAN (NAIC-CEO): That is an interesting idea and I have not had a chance to look at what Mr. Greenberg is suggesting.
    • I guess I would start by saying that to some extent, we have been separating the insurance operations from the risky activities, and that is the reason that the insurance companies are still healthy, because we walled off the insurance companies.
    • That is the way our system of regulation works. They are walled off.
  • Mrs. MALONEY. Might I add, when people come to us to bail out AIG, they say we have to bail them out because of the insurance, the insurance product. If it is off on the side, then that is a whole
    different element of risk.
  • Ms. VAUGHAN. I am not sure I agree with that argument. I guess I would have to talk to whomever it is.
    • I think it is an interesting idea.
    • Do you just spin the insurance companies off and kind of let them go on their way and do their thing.
    • We have been trying to work, recognizing that if you spin the insurance companies off, that does not solve the bigger problem that you have, which is these unregulated entities that are soaking up these taxpayer dollars.
    • We have been really trying to work with the Federal Reserve and the folks who are trying to solve this bigger problem and trying to be partners, and trying to do what is going to be helpful to the bigger problem.
    • If keeping the insurance companies in there is part of the solution long term, if it is going to help everyone, then we want to work to try to figure out a way to make this work.
    • We do go into this knowing that our regulatory structure has walled off those insurance companies and we are going to be focused on making sure that the policyholders stay protected as this happens.

2009 0305 - GOV (House) -  Perspectives on Systemic Risk - (Part 1 of 2) - PDF-254p

  • Hank Greenberg:  One, wall off AIG Financial Products from the rest of the company and replace as many loans as possible with guarantees.  (p14)

2009 0402 - GOV (House - Oversight and Reform) - The Collapse and Federal Rescue of AIG and What It Means for the U.S. - PDF-87p

2021 - YPFS Lessons Learned Oral History Project: An Interview with Eric Dinallo - 19p

(p17-18) - Eric Dinallo: Geithner asked about, because they're seriously considering, giving serious thought about a debtor in possession—DIP—thing for AIG.

  • He's like, "What do you think?"
  • I'm like, "It's a horrible idea."
  • He said, "Why?

I said, "Because while it looks possible on paper, and I get the point.

The operating companies are healthy, like the way an airline would do it.

  • If you file for bankruptcy at the holding company level, all these subsidiaries, they're going to start ...
  • Some states may even require by law … that the states will seize the operating companies, because the holding company filed for bankruptcy.
  • They're going to pull up the drawbridge, and go into castle mode.
  • Then you're going to have a run on insurance companies.

2011 1119 - GOV (JEC) - Financial Regulatory Reform: Protecting Taxpayers and the Economy - Geithner - PDF-61p

(p52) - Responses of Secretary Timothy F. Geithner to Questions from Representative Michael C. Burgess, M.D

  • Geithner: In particular, the government did not have the ability to quickly separate the stable underlying insurance businesses from the complex and dangerous financial activities carried out primarily by the parent holding company.
    • Experts suggested that achieving that separation would take several years.
    • Bankruptcy was not a viable option.
  • Mr. LUETKEMEYER. Mr. Paulson, one of the things that we are looking into here with AIG, can you explain to me, AIG and their Financial Products, was that a subsidiary of AIG or was that part of their business model?
  • Mr. PAULSON. I believe it was part of the business model.
  • Mr. LUETKEMEYER. There wasn’t a separate entity that was separately capitalized?
  • Mr. PAULSON. It was clearly at the holding company and it was part of——
  • Mr. LUETKEMEYER. The thing that makes——
  • Mr. PAULSON. It wasn’t part of an insurance business model, but it was sure part of the company’s business strategy.
  • Mr. LUETKEMEYER. Because it makes a big difference. If it is not part of the insurance product company and it is a subsidiary that is separately capitalized, you can let that thing go down and it doesn’t impact the insurance part of it, which I believe it was. Is that not correct?
  • Mr. PAULSON. Well, I would say this to you. This company was so big and intertwined that it was—if there was any way that the people who were working on this could have found a way to just hive off and let one small part of the company go down——  (p140)
  • Mr. PAULSON. So to just be clear, there was no way to hive off and handle this situation differently. There was a very few days to act to prevent bankruptcy with no wind-down powers to let this company be liquidated and avoid bankruptcy.
  • Mr. LUETKEMEYER. Well, with all due respect, if it is a separate entity, a subsidiary, it could go beyond and the rest of it could still stand on itself, sir, but that being——
  • Mr. PAULSON. Well——

2010 0127 - GOV (House) - The Federal Bailout AIG - [PDF-652p]

2009 1231 - Examination Report of AIG - AGC Life Insurance Company - Missouri (p6/10)

Federal Income Tax Allocation Agreements

The Company entered into a consolidated federal income tax allocation agreement with AIG in 2007.

  • This agreement provides that AIG will charge AGC for that portion of the consolidated tax liability. before tax credits, that would have been paid by the Company if it had filed a separate return, and will reimburse the Company for certain deductions and tax credits.
  • Under this agreement AIG agrees not to charge the Company a greater portion of tax liability than would have been paid by the Company if it had filed a separate return.  (p10/14)

2009 1231 - Examination Report of AIG - AGC Life Insurance Company - Missouri - 25p

  • 35. In the Separation Agreement entered into by AIG, MG subsidiary American Home Assurance Corp. ("AHAC") (which nominally owned the majority of AIG's THI common stock), and THI, the parties expressly designated certain "Intercompany Agreements" that would remain in place post-separation, including the Securities Lending Agreements between AIG and THI, TRC and TRZ, as well as certain related investment management agreements between AIG and TRH.  (p12)
  • 40. The primary source of AIG's control was AIG's beneficial ownership, until June 2009, of approximately 59% of THI's outstanding common, voting stock (as noted, THI wholly owns TRC and TRZ). (p13)

2010 0629 - LC - Transatlantic vs AIG - Affirmation of Anthony J. Albanese - 116p

National Union is a subsidiary of AIG Property Casualty U.S., Inc.,
  • which is a subsidiary of AIG Property Casualty Inc.,
  • which is a subsidiary of AIUH LLC,
  • which is a subsidiary of American International Group, Inc. American International Group, Inc. common stock is listed on the New York Stock Exchange (NYSE: AIG) as well as the Tokyo Stock Exchange.
National Union discloses the following subsidiaries: AIG Home Loan 1, LLC AIG Lodging Opportunities, Inc. AIGGRE 6037 Investor LLC AIGGRE Bridges/Angeline Investor, LLC AIGGRE Cherry Creek Investor, LLC AIGGRE Columbia Pike, LLC AIGGRE Dunwoody Investor, LLC AIGGRE Gardens Investor, LLC AIGGRE LSU Baton Rouge LLC AIGGRE Maple LLC AIGGRE Market Street LLC AIGGRE Park Central LLC AIGGRE Retail Investor II LLC AIGGRE Vista LLC Akita, Inc. American International Overseas Association DS Acquisition JV, LLC DS Acquisition Property Owner, LLC, Franco Investment I Corp. Franco Investment II Corp. Marlwood Commercial, Inc. Mt. Mansfield Company, Inc. National Union Fire Insurance Company of Vermont Ridgeway Universal S.A. Spruce Peak Realty, LLC Stowe Mountain Holdings, Inc. Stowe Mountain Club, LLC Stowe Mountain Lodge, LLC.

National Union discloses its affiliates in a Supplemental Disclosure that follows the Conclusion section of this brief.

 
Court of Appeals - New York - APL-2014-00271 - CaseText Link