Bailing out American International Group (AIG) was probably the most unpleasant part of the whole Wall Street bailout. It was also the part I expected to cost us the most money. How does that look now?
WASHINGTON—The Treasury Department said it would generate $7.6 billion in proceeds from its sale of American International Group (AIG), as it sells nearly all its remaining holdings in the insurer it helped rescue at the height of the financial crisis.
The government said Tuesday it would sell about 234 million common shares at $32.50 each, matching the price it got when it sold an even larger slug of shares in September. AIG’s stock closed Monday at $33.36, and jumped 1.6% to $33.90 in heavy pre-market trading Tuesday.
The transaction is expected to close on Friday. By Treasury’s calculation, the final round of sales means the government will have a net positive return on its AIG bailout of $22.7 billion.
As for the entire TARP program, it is projected to ultimately cost about $25 billion. Basically all of that will come from money we could not recoup from the auto industry.
In perspective, however, $25 billion is half what New York, New Jersey, and Connecticut are asking for in Superstorm Sandy recovery money.
