Governor David A. Paterson today announced a multi-billion dollar financing plan to stabilize American International Group (AIG), the world�s largest insurance provider, at no cost to New York taxpayers. The plan calls for AIG to transfer some assets to provide necessary cash for short-term liquidity, a move that requires regulatory oversight approval from the New York Insurance Department. AIG will undertake a series of transactions that are expected to raise about $20 billion, solving the company�s immediate cash liquidity problem. Additionally, Governor Paterson has sent Insurance Superintendent Eric Dinallo to work with the Federal Reserve on a plan to help AIG.

�Wall Street�s continuing problems should serve as a stark reminder that this recession is far from over. New York State has taken the first step towards helping to stabilize AIG, which is otherwise a very healthy company,� said Governor Paterson. �On a state level, we were able to reach a market-based solution that will stabilize AIG at no cost to New York taxpayers. Policyholders should also know that they are safe, and their insurance policies are still good. AIG�S insurance companies are financially strong, and the Insurance Department will continue to ensure that they remain strong.�

These transactions will protect the company�s policyholders, which is a pre-condition of the Insurance Department�s approval. Additionally, the Insurance Department will continue to closely monitor AIG to ensure it has the assets to pay claims.

New York State Insurance Department Superintendent Eric Dinallo said: �Under Governor Paterson�s direction, we are working closely with AIG to craft a transaction that will stabilize an important New York insurance company, while protecting policyholders. This continues our work with the bond insurers where the State proactively produced market-based commercial solutions. We will continue to implement the Governor�s program of creative and pragmatic regulation that promotes growth while protecting policy holders and consumers.�

AIG is the world�s largest insurance company with $1 trillion in assets, and more than 100,000 employees. In New York State, AIG has 8,500 employees who earn an annual payroll of $897 million.

(YWN Desk – NYC)