Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of insurer AIG
So what: AIG announced today that it has locked down $4.3 billion in private-market funding to replace the loans from the Federal Reserve Bank of New York. The loans are coming from 36 banks including Bank of America, JPMorgan Chase, Citigroup, and Goldman Sachs and are split between a $3 billion facility for AIG and a $1.3 billion facility for AIG subsidiary Chartis. The loan commitments are another key step for AIG as it continues its trek to regain financial market trust and return to being a fully private company.
Now what: It's been an exciting time for AIG lately as it not only has been making moves to get Uncle Sam off its back, but people involved with the company are starting to talk about growth again. At this point, the stock still trades at multiples below AIG's historical valuations -- though it's highly questionable whether the post-bailout AIG will be much like the pre-bailout company. We've seen savvy investors continue to build stakes in the company, but we've also seen the stock soar this year (it's nearly tripled since its February lows). If I were a betting man, I'd say we'll probably see some more upside action as the company continues to make progress toward paying back the government. But as far as the company being a solid, long-term investment, I think that's still a big question mark.
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