The AIG lifeline
The Fed gives a US$85 billion (S$122 billion) loan to AIG in exchange for a near 80 per cent stake in the company.
All of AIG's assets and those of its subsidiaries are pledged to secure the loan.
AIG will be charged a nosebleed interest rate of 11.3 per cent, with a US$19 billion interest payment due at the end of the loan's term.
This government lifeline will allow AIG to sell assets to raise cash in an orderly fashion.
Close window