AIG Taps Fed Facility To Repay U.S. Loan

American International Group repaid $6.8 billion of a $123 billion U.S. government credit line by borrowing from the Federal Reserve’s commercial paper facility on Thursday. (Reuters)

Earlier Thursday, the U.S. insurer said four affiliates had applied to participate in the Federal Reserve’s commercial paper funding facility, hoping to raise an additional $20.9 billion to repay the government loan and other debts. (Reuters)

On September 16th, the U.S. government extended an $85 billion bridge loan to help the insurer avert bankruptcy.  Two weeks later, the government granted an additional $37.8 billion credit line.

To date, AIG owes $83.5 billion under the two emergency facilities.

Separately Thursday, former AIG CEO Maurice “Hank” Greenberg petitioned company management to request an amendment to the terms of the government loan, arguing that the insurer should receive access to the sharply lower cost capital of the Federal Reserve’s discount window.

Sources:

• AIG Makes Partial Repayment Of Fed Line Of Credit (Reuters)
• AIG Units To Participate In Commercial Paper Program (Reuters)
• Greenberg Fights For A Sweeter Deal (Fortune)

Related:

• AIG: Where Did the Cash Go? [ANALYSIS]
• Fed Expands AIG Bailout, Injects $37.8B
• U.S. Government Takes Control Of AIG, Extends $85 Billion Lifeline