AIG'S ASIAN SAVIOR: How a former subsidiary helped save the company

摘要

INSURANCE GIANT AIG has always enjoyed a special relationship with AIA, its former Asian subsidiary. After all, AIG was founded in Shanghai in 1919 by C.V. Starr, an adventurous Californian who pioneered life insurance in Asia. AIG left China in 1950, one year after Mao's communist takeover, but AIA remained something of a crown jewel, with real estate holdings in some of Asia's toniest districts. More recently, the Asian insurer has been AIG's savior: Amid the 2008 financial meltdown, the U.S. Federal Reserve Bank provided AIG with a huge credit facility in exchange for warrants in the company. To help repay the Fed, AIG sold most of its stake in AIA. Today, a reinvigorated AIG - the U.S. government sold off its entire stake at a profit - may be looking to compete with its old sibling. In late November, AIG announced an agreement with People's Insurance Co. of China, a state-owned insurer, to invest roughly $500 million in PICC's December public offering in Hong Kong, which raised $3.1 billion. As part of the deal, the two companies are expected to form a joint venture to sell life insurance in China - AIA'S old turf.