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Moody's maintains AIG
Moody's Investors Service said it is maintaining its present ratings on American International Group, Inc. (senior unsecured debt at A3, short-term debt at Prime-1, on review for possible downgrade) following announcements of AIG's large net loss for the third quarter of 2008 and of a government-supported restructuring plan.
Moody's noted that the restructuring plan includes a large infusion of preferred stock that would restore much of the capital lost in recent periods, along with transactions that would limit AIG's future losses on some of its most troublesome investment and derivative exposures.
The current ratings on AIG incorporate Moody's expectation that the insurer will continue to benefit from strong government support while it executes its divestiture and restructuring plan.
The continuing review for possible downgrade reflects the substantial uncertainty surrounding (i) the value that will be received for businesses that are sold, (ii) potential additional losses incurred during the unwinding of other businesses, and (iii) the future performance of businesses that are retained. Such uncertainty is heightened by the weak global economy, according to the agency.
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