American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q4 2013 Earnings Presentation
26 slides from American International Group, Inc. New's earnings presentation, Feb 14, 2014
Slide 1: Fourth Quarter 2013 Results Conference Call Presentation
American International Group, Inc. Fourth Quarter 2013 Results Conference Call Presentation February 14, 2014
Slide 2: Cautionary Statement Regarding Projections and Other Information About Future Events
Cautionary Statement Regarding Projections and Other Information About Future Events This document and the remarks made within this presentation may include, and officers and representatives of American International Group, Inc. (AIG) may from time to time make, projections, goals, assumptions and s
Slide 3: Fourth Quarter 2013 Key Themes
Fourth Quarter 2013 Key Themes Highlights: Noteworthy Items In February 2014, $1 billion increase in share repurchase authorization; 25% increase in quarterly dividend to $0.125/sh. $4.1 billion of insurance company cash dividends ($8.7 billion in cash dividends and loan repayments in 2013) Capi
Slide 4: Financial Highlights
Financial Highlights Fourth Quarter Inc. ($ in millions, except per share amounts) 2012 2013 (Dec.) Revenues $17,169 $17,346 1% Net income (loss) attributable to AIG (3,958) 1,978 NM Diluted earnings per common share ($2.68) $1.34 NM ROE, Ex. AOCI (1) NM 8.5% After-tax operating income attributable
Slide 5: After-tax Operating Income
After-tax Operating Income 4Q13 results reflect strong growth in insurance operating earnings. Fourth Quarter ($ in millions, except per share amounts) 2012 2013 Insurance operations: AIG Property Casualty ($944) $1,090 AIG Life and Retirement 1,090 1,406 Mortgage Guaranty (45) 48 Total Insurance Op
Slide 6: Deferred Tax Asset Overview
Deferred Tax Asset Overview AIG continues to have substantial deferred tax assets that are available to offset future tax obligations. As of 12/31/12 As of 12/31/13 Gross Deferred Gross Deferred ($ in billions) Type Attributes Tax Asset Attributes Tax Asset Utilization/Expiration Utilize against A
Slide 7: Strong Capital Position
Strong Capital Position Capital Structure Book Value Per Share ($ in billions, except per share data) $68.62 $124.1 $70.0 $66.38 $122.3 $4.34 $0.7 $0.6 $16.1 $8.51 $15.7 $60.0 Non-redeemable $9.4 $5.5 noncontrolling $50.0 interests (1) Financial Debt $40.0 AOCI $64.28 $100.5 $30.0 $57.87 BVPS, $98.0
Slide 8: Financial Flexibility – A Source of Strength
Financial Flexibility – A Source of Strength Parent Cash, Short-Term Investments & Insurance Company Distributions Unencumbered Securities ($ in millions) ($ in billions) $12.7 $13.1 FY 2013 - $8,893 $12.6 $5,000 $4,274 $3.0 $90 $3.0 $4,000 $1,322 Unencumbered $3,000 Fixed Maturity Securities $1,933
Slide 9: AIG Property Casualty – Financial Results
AIG Property Casualty – Financial Results Operating results demonstrate continued execution of strategic initiatives. ($ in millions) 4Q12 4Q13 Global Combined Ratios Calendar Year Accident Year, Net premiums written $7,809 $8,028 as adjusted(1) 140 125.1 120 17.3 Net premiums earned 8,613 8,621 103
Slide 10: Commercial Insurance – Underwriting Results
Commercial Insurance – Underwriting Results Net Premiums Written Commercial Insurance NPW, excluding foreign exchange, the timing of recognition of ceded premiums written on excess of loss ($ in millions) reinsurance agreements and premium adjustments, grew 7% from 4Q12. This increase reflected gr
Slide 11: Consumer Insurance – Underwriting Results
Consumer Insurance – Underwriting Results Net Premiums Written Consumer Insurance NPW, excluding foreign exchange and ($ in millions) timing of recognition of ceded premiums written on excess $4,000 of loss reinsurance agreements, grew 4% from 4Q12. On $3,395 $3,189 an as-reported basis NPW declin
Slide 12: AIG Property Casualty – Investments
AIG Property Casualty – Investments Net investment income: Fourth Quarter Full Year ($ in millions) 2012 2013 Inc./(Dec.) 2012 2013 Inc./(Dec.) Interest and dividends $ 1,036 $ 1,041 0% $ 4,215 $ 4,124 (2%) Alternative investments 157 303 93% 484 870 80% (1) Other, net 24 76 217% 81 273 237% Net inv
Slide 13: AIG Property Casualty – Prior Year Development
AIG Property Casualty – Prior Year Development Quarterly Full Year ($ in millions) 1Q13 2Q13 3Q13 4Q13 2012 2013 Product: Casualty $ 23 $ 89 $ 114 $ 68 $ 700 $ 294 Financial lines (9) 3 (9) (12) (250) (26) Specialty (46) 8 46 41 68 50 Property (29) 156 (46) (45) (228) 37 Total Commercial (61) 257 10
Slide 14: Mortgage Guaranty – Growing Profitability
Mortgage Guaranty – Growing Profitability New business increasingly drives trend of improving operating results. New Insurance Written ($ in millions) 4Q12 4Q13 ($ in billions) $14 Net premiums written $236 $255 $11.6 $12 $10.9 $10 Net premiums earned 190 203 $8 $7.2 Underwriting income (loss) (82)
Slide 15: AIG Life and Retirement – Financial Results
AIG Life and Retirement – Financial Results Strong sales and growth in pre-tax operating income. ($ in millions) 4Q12 4Q13 Increase in pre-tax operating income of 29% driven by Premiums and deposits $5,215 $8,042 effective spread management, higher net investment Premiums 634 606 income and fee in
Slide 16: AIG Life and Retirement – Retail & Institutional Results
AIG Life and Retirement – Retail & Institutional Results Retail Pre-Tax Operating Income(1) Institutional Pre-Tax Operating Income(2) ($ in millions) ($ in millions) $900 $700 $820 $800 $586 $600 $700 $186 $492 $598 $500 $600 $191 $109 $400 $500 $176 $400 $413 $300 $300 $398 $200 $392 $200 $308 $213
Slide 17: AIG Life and Retirement – Investments
AIG Life and Retirement – Investments Net investment income: Fourth Quarter Full Year ($ in millions) 2012 2013 Inc./(Dec.) 2012 2013 Inc./(Dec.) Interest and dividends $ 2,316 $ 2,291 (1%) $ 9,650 $ 9,173 (5%) Alternative investments 332 505 52% 954 1,567 64% Call and tender income 42 57 36% 146 19
Slide 18: AIG Life and Retirement – Base Yields and Spreads
AIG Life and Retirement – Base Yields and Spreads Base Yields(1) 5.50% 5.35% 5.33% 5.30% 5.26% 5.29% 5.30% 5.25% 5.24% 5.12% 5.10% 5.17% 5.10% 5.14% 5.08% 5.10% 4.90% 4.95% 4.70% 4.85% 4Q12 1Q13 2Q13 3Q13 4Q13 Cost of Funds(2) 3.40% 3.26% 3.10% 3.06% 3.08% 3.05% 3.20% 3.00% 3.14% 2.80% 2.91% 2.89% 2
Slide 19: Q&A
AIG Q&A
Slide 20: Appendix
AIG Appendix
Slide 21: Non-GAAP Reconciliation – Pre-tax Operating Income (Loss)
Non-GAAP Reconciliation – Pre-tax Operating Income (Loss) 4Q12 AIG AIG Mortgage Other ($ in millions) Property Casualty Life and Retirement Guaranty Operations Total Income (loss) from continuing operations, before tax $ (923) $ 1,252 $ (47) $ (6,321) $ (6,039) Adjustments to arrive at pre-tax opera
Slide 22: Non-GAAP Reconciliation – After-tax Operating Income
Non-GAAP Reconciliation – After-tax Operating Income After-tax Operating Income Attributable to AIG Fourth Quarter ($ in millions) 2012 2013 Net income (loss) attributable to AIG (3,958) 1,978 Adjustments to arrive at After-tax operating income attributable to AIG: (Income) loss from discontinued op
Slide 23: Non-GAAP Reconciliation – Return On Equity
Non-GAAP Reconciliation – Return On Equity Fourth Quarter Return On Equity 2012 2013 Annualized Net income attributable to AIG NM $ 7,912 Annualized After-tax operating income attributable to AIG $ 1,160 6,816 (1) Average AIG Shareholders' equity 99,834 99,632 Less: Average AOCI 12,394 6,435 (1) Ave
Slide 24: Non-GAAP Reconciliation – BVPS ex. AOCI and Premiums & Deposits
Non-GAAP Reconciliation – BVPS ex. AOCI and Premiums & Deposits Book Value Per Common Share - Ex. AOCI December 31, ($ in millions, except per share data) 2012 2013 Total AIG shareholders’ equity $ 98,002 $ 100,470 Less: AOCI 12,574 6,360 Total AIG shareholders’ equity, excluding AOCI $ 85,428 $ 94,
Slide 25: Non-GAAP Reconciliation – Accident Year Combined Ratio, As Adjusted
Non-GAAP Reconciliation – Accident Year Combined Ratio, As Adjusted AIG Property Casualty Quarterly Accident year combined ratio, as adjusted 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 Commercial Insurance Loss ratio 72.3 70.7 78.0 100.9 64.9 72.6 71.8 77.9 Catastrophe losses and reinstatement premiums
Slide 26: AIG – Bring on tomorrow
AIG Bring on tomorrow
American International Group — Q4 2013 Earnings Presentation on 6ix