On Monday, the Governmental Accountability Office (GAO) released a report entitled “Status of Government Assistance Provided to AIG.” The report, the seventh in a series by the GAO on the Troubled Asset Relief Program, focuses on the initial assistance the government provided to American International Group, Inc. (AIG).
In the report, the GAO describes the basis for federal assistance to AIG, the nature and type of assistance provided, and steps taken to protect the government’s interest. The report also provides selected indicators of the status of federal assistance and AIG’s financial condition. However, the report states that the indicators do not provide a clear picture of AIG’s future: “Indicators of AIG’s repayment of federal assistance show some progress in AIG’s ability to repay the federal assistance; however, improvement in the stability of AIG’s business depends on the long-term health of the company, market conditions, and continued government support. Therefore, the ultimate success of AIG’s restructuring and repayment efforts remains uncertain.”
The report comes after AIG's announcement of the latest in several asset divestments and the continuation of its restructuring efforts. The GAO noted that it will continue to review the Federal Reserve’s and Treasury’s monitoring efforts and report on the indicators to determine the likelihood of AIG repaying the government’s assistance in full.