3 Mar 2009

More aid for AIG after record loss

7:43 am on 3 March 2009

The American insurance company AIG has announced a quarterly loss of $US61.7 billion, the biggest in corporate history.

The company will receive an extra $US30 billion from the US government after officials concluded it was too big to be allowed to fail.

AIG, received $US150 billion of taxpayer aid last year.

The new bailout avoids any credit rating downgrades for the time being.

In a joint statement on Monday, the Treasury and the Federal Reserve said the "potential cost to the economy and the taxpayer of government inaction would be extremely high."

AIG operates in more than 130 countries. It was once the world's largest insurer by market value.

The quarterly loss was AIG's fifth in a row. For all of 2008, AIG lost $US99.29 billion, wiping out profit dating back to the early 1990s.

The latest rescue package is the third since last fall when the government stepped in to bail out AIG.