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Follow on Google News | Worldwide Markets -“Sun Worldwide”–(AIG Bailed Out Again)…“Sun Worldwide on why AIG stands to receive another $30bn in taxpayer funding.
By: Brad Cullen The source was responding to questions regarding rumors that “Sun Worldwide” is considering a program of modest forays into banking stock. The source said that because AIG products still provide protection for over $300 billion in collateralized Debt Obligations (CDOs) on bank balance sheets, its failure would force banks to write down the value of the CDOs thus forcing them to seek even more capital from the US government. The additional funding being provided to AIG is seen as the lesser of two evils despite the insurer having received $150bn from the Federal Reserve and the US Treasury in the last 5 months. “Sun Worldwide” believes that a number of mid-sized banking concerns in the US have not been as exposed to the subprime debacle as firms like Citigroup or Bank of America and, as such, are well-placed to take advantage of the inevitable turnaround in the fortunes of the banking sector. AIG was once the world’s largest insurer and still has a number of extremely profitable business streams but its London-based Financial Products subsidiary is largely responsible for the $100bn annual loss that has seen the share price decimated and trading at a mere $0.42 on the DJIA. End
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