American International Group's Top 5 From 2013http://www.fool.com/investing/general/2013/12/13/american-international-groups-top-5-from-2013.aspx Jessica Alling
December 13, 2013
The past year has been a particularly busy one for insurance giant American International Group (NYSE: AIG). As we come closer to the beginning of 2014, investors should take some stock in the progress AIG has made over the course of 2013. Here are some of the biggest developments and events of AIG's 2013.
1.The beginning and end of government oversight
CEO Robert Benmosche cited the regulator's help in developing the testing methods it would need to perform with once the required performance metrics for Systemically Important Financial Institutions are finalized. The SIFI designation of AIG came in June, which was neither unexpected nor protested by AIG's management.
2. Flying high
AIG has been very patient with the entire ordeal, but as of its third-quarter conference call, management made it clear that a decision to close the deal as-is or walk away would need to be made in the fourth quarter. The company has been preparing a tangent line of attack for the disposal of ILFC (an IPO), but recent developments have shown that it is in talks with AerCap Holdings (NYSE: AER), the world's largest independent aircraft leasing business.
3. Business opportunities
The second opportunity arose with the resurgence of the housing market. Though the company's near-collapse in 2008 was spurred on by risky bets on mortgage bonds, AIG stepped back into the mortgage guaranty ring in early 2013. The announcement made some investors nervous at first, but the company's strategy was different this time around -- and paid off in spades. The division has cleared off the majority of its bad loans from the financial crisis days and is going like gangbusters (much like the entire private mortgage insurance market).
4. Investors' favorite
Another top highlight for investors this year came after the second quarter closed, when management announced the reinstatement of a quarterly dividend. With a $0.10 dividend, the company only measured half of its pre-bailout dividend, but it was welcomed by investors who had waited for five years to see come capital returns. AIG also announced that it had approval to restart its share buyback program, which has been slow moving so far, but another welcomed event as investors look to have some of the dilution, caused by the governmental ownership, cut down.
5. Corporate tussles