A new U.S. Government Accountability Office report concludes that New York-based American International Group’s (AIG) ability to repay bailout funds is an open question.
Of the roughly $180 billion in assistance provided to the company since the start of the financial crisis, as much as $36 billion may not be paid back, the Congressional Budget Office estimated in March. While the GAO report notes that AIG is making progress in reducing the amount of debt that it owes, it is primarily due to the restructuring of the composition of government assistance from debt to equity. The Federal Reserve, Federal Reserve Bank of New York, and the U.S. Treasury combined own 80% of AIG’s outstanding shares.
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