S&P rates AIG notes A-

Standard & Poor's said it assigned its A- senior unsecured debt rating to American International Group Inc.'s new issue of $2 billion of senior unsecured notes.

The agency said it expects the senior notes to be issued in two tranches: $750 million of notes with a three-year maturity and $1.25 billion of notes with a five-year maturity.

According to S&P, AIG is issuing this debt to pay down the last $1.5 billion of the U.S. Treasury's preferred interest in what is known as the AIA special purpose vehicle. This will free up the remaining assets still pledged as collateral for the preferred interest, specifically AIG's interest in Maiden Lane III and $1.6 billion held in escrow for the potential indemnification of MetLife Inc. related to its purchase of a former AIG life insurance subsidiary.

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