Friday, January 7, 2011

Federal Reserve Continues to Shovel Money to AIG

Think the bailouts are over? Think again.

The latest data from the Federal Reserve indicates the Fed continues to increase the amount of money they are providing to AIG.

At November 3, 2010, the balance of credit extended by the Federal Reserve to AIG  stood at $19.235 billion by December 29, 2010, the credit extended increased to $20.452 billion. An increase of 6.3%.


  1. You can read in detail about AIG developments beginning p. 16 of the Fed's monthly intervention report:

    From p. 18:

    "On September 30, 2010, AIG announced an agreement with the Treasury, the FRBNY, and the trustees
    of the AIG Credit Facility Trust (the “Trust”) on a
    comprehensive recapitalization plan (the “Recapitalization”) designed to repay all its obligations to American
    3 The measures include:
    — an accelerated repayment of the outstanding balance (including all accrued interest and fees) on
    the AIG revolving credit facility and termination
    of that facility,
    — a draw by AIG of up to $22 billion of undrawn
    Series F funds available to the company under
    the Troubled Asset Relief Program (TARP) to
    purchase an equal amount of the FRBNY’s preferred interests in the AIA and ALICO SPVs,
    — the transfer by AIG of the preferred interests purchased from the FRBNY to the Treasury as consideration for the draw on the available Series F
    funds, and
    — the conversion of the AIG preferred stock currently owned by the Treasury and the Trust into
    common equity of AIG."

    So AIG is going into hawk with the Treasury via TARP to buy out FRBNY, yet it increases the draw on its revolving credit facility with FRBNY.

  2. Well, it's over now.

    Or, is it?