Monday, December 27, 2010

AIG Rallies On New Credit Facilities

Shares of American International Group Inc. (NYSE: AIG) surged more than 8% on Monday after the insurer disclosed in a regulatory filing it has obtained $4.3 billion in new credit lines from commercial banks to replace its funding from the Federal Reserve Bank of New York. The government-controlled insurer said it has established $3 billion in new bank credit facilities, split between a 364-day line and a three-year facility, under which banks have agreed to make loans to AIG. In addition, AIG's property and casualty insurance subsidiary, Chartis Inc., entered into a one-year, $1.3 billion letter of credit facility.  Thirty-six banks participated in the facilities, said AIG. Stay tuned for more.

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