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AIG tries to convince regulators to change accounting standards
American International Group (AIG), the world's biggest insurer by assets, has spoken with regulators about changing the accounting rules that forced the company to record an $11.1 billion fourth-quarter writedown.
- Bloomberg
- Published: 00:01 March 16, 2008
New York: American International Group (AIG), the world's biggest insurer by assets, has spoken with regulators about changing the accounting rules that forced the company to record an $11.1 billion fourth-quarter writedown.
AIG believes the value of some investments isn't best reflected by rules that require the insurer estimate the price it would get for selling them at the end of each quarter, spokesman Chris Winans said yesterday. A projection of the "maximum possible loss'' on investments the company continues to hold is a more useful number to investors, Winans said.
"We've discussed an idea with various regulators and other interested parties in the market,'' Winans said. He declined to name the regulators.
The fourth-quarter writedown on contracts protecting fixed- income investors against default pushed AIG into the biggest loss in its 89-year history. The company has said that most of the losses will reverse over time.
AIG said it may lose $900 million on the so-called credit-default swaps.
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