AIG Reports Record Loss As US Rescues Insurer Again

American International Group posted a $61.7 billion quarterly loss, the biggest in corporate history, and reached a new government bailout deal after officials concluded the insurer was too big to be allowed to fail.

AIG [AIG 0.49 0.07 (+16.67%) ], which got $150 billion of taxpayer aid last year, will get access to up to $30 billion of new government capital.

The new bailout avoids for now any crippling credit rating downgrades that could force AIG to come up with billions of dollars that it might not have.

“Given the systemic risk AIG continues to pose and the fragility of markets today, the potential cost to the economy and the taxpayer of government inaction would be extremely high,” the U.S. Treasury Department and the Federal Reserve said in a joint statement.

AIG, which operates in more than 130 countries, was once the world’s largest insurer by market value. Its shares are now worth about 50 cents each.

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