American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Investor Presentation (March 2014)
43 slides from American International Group, Inc. New's investor presentation, Mar 3, 2014
Slide 1: American International Group, Inc. Investor Presentation
Exhibit 99.1 American International Group, Inc. Investor Presentation March 3, 2014
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information This document and the remarks made within this presentationmay include, and officers and representativesof American InternationalGroup, Inc. (AIG) may from time to time make, projections, goals, assumptions and statements that may constitute
Slide 3: AIG – An Established Global Insurance Franchise
AIG – An Established Global Insurance Franchise A platform for delivering sustainable profitable growth. Core Insurance Strategies Key Accomplishments Businesses Full year 2013 NPW growth of 3.8%, excluding FX, Grow high value lines and optimize business mix compared to full year 2012 Optimizing Cas
Slide 4: AIG – Building on Capital Strength
AIG – Building on Capital Strength * 25% increase in quarterly dividend to $0.125/sh. in Feb. 2014 * 2013 non-DIB debt calls and tenders of $5.3 * billion (face amount) AIG Shareholders’ Equity - Active Capital Management $597 million of shares repurchased in 2013; $100.5 bn at December 31, 2013 $1.
Slide 5: AIG Property Casualty
* * * * * * * * * AIG Property Casualty
Slide 6: AIG Property Casualty – A Truly Global Franchise
AIG Property Casualty – A Truly Global Franchise AIG Property Casualty is a diversified global P&C market leader with 2013 NPW of over $34 billion. #1 U.S.-based property casualty EMEA (1) insurance organization in Europe, with 2013 NPW: $6.8 bn established and growing positions in 20% of total NPW
Slide 7: AIG Property Casualty – Financial Highlights
AIG Property Casualty – Financial Highlights Full Year ($ in billions) 2011 2012 2013 Net premiums written $34.8 $34.4 $34.4 Net investment income 4.3 4.8 5.3 Pre-tax operating income $1.1 $1.8 $4.8 Accident year loss ratio, as adjusted 68.7 65.2 63.8 Expense ratio 30.4 34.6 34.6 Accident year combi
Slide 8: AIG Property Casualty – Business Overview
AIG Property Casualty – Business Overview A broad product platform. Commercial Insurance Consumer Insurance Full Year 2013 NPW – $20.8 bn Full Year 2013 NPW – $13.6 bn Global – Unique ability to serve multinational clients Innovative – Often first to market in new products and services, such as Cybe
Slide 9: AIG Property Casualty – Strategic Focus
AIG Property Casualty – Strategic Focus Strategic levers driving shareholder value creation. Business Underwriting Claims Operational Capital Mix Excellence Service Effectiveness Management Balance growth with Globalize Global Claims Simplify and Use RAP as a key profitability and risk standards for
Slide 10: AIG Property Casualty – Strong Brands and Customer Loyalty
AIG Property Casualty – Strong Brands and Customer Loyalty AIG Property Casualty continues to be recognized for excellence. PropertyCasualty360 British Insurance Award World Travel Fair 2013 Best Overall Commercial 2013 Underwriter of the Year 2013 Best Quality Service, Travel Insurance Insurance Pr
Slide 11: AIG Property Casualty – Product Diversification
AIG Property Casualty – Product Diversification Commercial Insurance Consumer Insurance General Liability Commercial Auto Casualty Workers’ Compensation Excess Casualty Personal Accident Crisis Management Accident and Supplemental Medical Health Travel Global Property including high deductible Life
Slide 12: AIG Property Casualty – Growth Economies
AIG Property Casualty – Growth Economies Growth economies are those within Central Europe, Middle East, Africa, Latin America and Asia Pacific, excluding Japan The largest foreign property and casualty insurer in China (1) Strategic investments in PICC for P&C and Life & Retirement products 10 year
Slide 13: AIG Property Casualty – Investment Composition & Ratings
AIG Property Casualty – Investment Composition & Ratings (As of December 31, 2013) Total Cash & Invested Assets -$123.1 billion(1) Bond Portfolio - $99.0 billion (1) - by Agency Credit Rating 1) Includes intercompany invested assets that are eliminated in consolidation. 13
Slide 14: AIG Life and Retirement
* * * * * * * * * * AIG Life and Retirement
Slide 15: AIG Life and Retirement – Operating from a Position of Strength
AIG Life and Retirement – Operating from a Position of Strength Long standing leading market positions Market Leader Scale advantage in key product lines Product Diversity Comprehensive portfolio of life insurance, A&H, annuity, group retirement, & Capacity for group benefits, institutional products
Slide 16: AIG Life and Retirement – Financial Highlights
AIG Life and Retirement – Financial Highlights Full Year ($ in billions) 2011 2012 2013 Premiums and deposits $24.4 $21.0 $28.8 Net investment income 9.9 10.7 10.9 Pre-tax operating income 3.3 4.2 5.1 Cash & invested assets (1) 194.2 205.3 196.9 Assets under management 256.9 290.4 318.0 Shareholders
Slide 17: AIG Life and Retirement – Diversified Business Mix
AIG Life and Retirement – Diversified Business Mix Full Year 2013 Full Year 2013 Premiums and Deposits - $28.8 billion Pre-tax Operating Income - $5.1 billion Retail: 69% Institutional: 31% Retail: 62% Institutional: 38% 17
Slide 18: AIG Life and Retirement – Assets Under Management
AIG Life and Retirement – Assets Under Management Year-over-year growth in AUM reflects strong retail investment product net flows, higher separate account balances and greater institutional assets. Assets Under Management – $318.0 billion at December 31, 2013 18
Slide 19: AIG Life and Retirement – Leading Market Positions
AIG Life and Retirement – Leading Market Positions Market Positions Excellence in Service, Marketing and Technology Market Tools International MarCom Rank* 2013 Achievement in Awards Metric Customer Excellence 2012 and 2013 Platinum 9M’13 FY’12 (ACE award for 7 th and Gold Awards Consecutive Year) (
Slide 20: AIG Life and Retirement – Broad Multichannel Distribution Network
AIG Life and Retirement – Broad Multichannel Distribution Network 2013 Sales by Channel Diversified Distribution Network Affiliated: 33% Non-affiliated: 67% VALIC Financial Advisors AIG Financial Network VALIC FAs 26% B-Ds Advisor Group 34% AIG Direct AIG Direct & Other 1% AIG Financial Network 3% B
Slide 21: AIG Life and Retirement – Variable Annuities
AIG Life and Retirement – Variable Annuities Changing competitive environment offers a unique opportunity. Variable Annuity “Non-Captive” Industry Sales (1) ($ millions) Nine Months 2013 FY 2012 FY 2011 FY 2010 FY 2009 Rank Sales Share Rank Sales Share Rank Sales Share Rank Sales Share Rank Sales Sh
Slide 22: AIG Life and Retirement – Investment Composition & Ratings
AIG Life and Retirement – Investment Composition & Ratings (As of December 31, 2013) Total Cash & Invested Assets - $196.9 billion (1) Bond Portfolio - $157.2 billion (1) - by Agency Credit Rating 1) Includes intercompany invested assets that are eliminated in consolidation. 22
Slide 23: AIG Life and Retirement – Net Investment Spread Management
AIG Life and Retirement – Net Investment Spread Management Base Yields (1) Cost of Funds(2) Base Net Investment Spreads(1) 1) Includes the investment return on surplus other than alternative investment or yield enhancement activities. 2) Excludes the amortizationof sales inducement assets. At Decemb
Slide 24: Mortgage Guaranty (United Guaranty Corporation)
* * * * * * * * * * Mortgage Guaranty (United Guaranty Corporation)
Slide 25: United Guaranty – Financial Highlights
United Guaranty – Financial Highlights Full Year ($ in millions) 2011 2012 2013 Net premiums written $801 $858 $1,048 Net investment income 132 146 132 Pre-tax operating income (loss) ($97) $9 $205 Combined ratio 128.9 119.2 90.9 Cash & invested assets (1) $4,081 $4,222 $3,934 Shareholders’ equity 2
Slide 26: United Guaranty – A Market Leader
United Guaranty – A Market Leader Risk based pricing driving profitable new business. New Insurance Written(1) Average ($ in billions) Vintage Year (2) FICO Score LTV Ratio 2010 760 90 2011 757 91 2012 758 91 2013 753 91 UGC’s risk-based pricing plan, Performance Premium, utilizes over a dozen varia
Slide 27: United Guaranty – Shrinking Legacy In-Force
United Guaranty – Shrinking Legacy In-Force Primary Delinquency Rate Primary Risk-in-force(RIF) – $36.4 billion As of December 31, 2013 (by vintage year) New business generatedafter 2008 represents 69% of primary domestic RIF at December 31, 2013, the highest among peers active before 2009 (1). Due
Slide 28: United Guaranty – Financial Strength
United Guaranty – Financial Strength Capitalization and Risk Asset Composition At September 30, 2013 Default Post 2008 Risk-to- Cash & Bonds to Total Admitted Assets At Dec. 31, 2013 Rate (%) RIF (%) Capital(1) United Guaranty 5.9 69 17.9 Genworth 8.2 45 19.3 MGIC 10.8 42 15.8 Radian 7.3 60 19.4 Ess
Slide 29: Capital Strength
* * * * * * * * * * Capital Strength
Slide 30: Capital Position and Ratings
Capital Position and Ratings Capital Structure Credit Ratings (2) ($ in billions, except per share data) S&P Moody’s Fitch AM Best AIG – Senior A- Baa1 BBB+ NR Debt AIG PC (3) – A+ A1 A A FSR AIG L&R (3) – A+ A2 A+ A FSR Book Value Per Share Dec. 31, Dec. 31, Leverage Ratios: 2012 2013 Financial Deb
Slide 31: Financial Flexibility – A Source of Strength
Financial Flexibility – A Source of Strength AIG Parent Cash, Short-Term Investments & Insurance Company Distributions Unencumbered Securities ($ in millions) ($ in billions) AIG Property Casualty distributions in 2013 included $1.8 billion from legal entity restructurings and an intercompany reinsu
Slide 32: Other Sources of Value
* * * * * * * * * * Other Sources of Value
Slide 33: Direct Investment Book and Global Capital Markets
Direct Investment Book and Global Capital Markets Direct Investment Book (1) Global Capital Markets (1) ($ in billions) Assets $23.3 $7.7 Liabilities $20.0 $3.1 Net Asset Value $3.3 $4.6 Legacy Matched AIG Hedging & Legacy AIGFP Stable Value Go Forward Assets & Liabilities Market Derivatives (2) CDS
Slide 34: Direct Investment Book Long-Term Debt
Direct Investment Book Long-Term Debt ($ in billions) $25 90% 80% 80% $20 (1) $17.9 70% $1.2 60% $14.6 62% $15 $5.5 $1.1 $12.9 50% $0.9 $11.1 $4.9 $0.7 40% 38% $10 $3.2 $4.3 $4.0 $6.9 30% $2.2 28% $2.2 $0.5 $8.0 20% $5 $6.4 19% $2.2 $3.7 $5.5 $3.7 $0.4 0% 10% $4.3 $3.1 $2.2 $0.4 $0.2 $0 0% as of 12/
Slide 35: Deferred Tax Asset Overview
Deferred Tax Asset Overview AIG continues to have substantial deferred tax assets that are available to offset future tax obligations. As of 12/31/12 As of 12/31/13 Gross Deferred Gross Deferred ($ in billions) Type Attributes Tax Asset Attributes Tax Asset Utilization/Expiration Utilize against AIG
Slide 36: Appendix
* * * * * * * * * Appendix
Slide 37: Glossary of Non-GAAP Financial Measures
Glossary of Non-GAAP Financial Measures AIG After-tax operating income (loss) attributable to AIG: is derived by excluding the following items from net income (loss) attributable to AIG: income (loss) from discontinued operations, net loss (gain) on sale of divested businesses and properties, income
Slide 38: AIG Consolidated Financial Highlights
AIG Consolidated Financial Highlights Full Year ($ in millions, except per share amounts) 2011 2012 2013 Revenues $65,105 $71,021 $68,678 (1) Net income attributable to AIG 20,622 3,438 9,085 Diluted earnings per common share $11.01 $2.04 $6.13 ROE, Ex. AOCI (2) 26.6% 3.7% 10.1% After-tax operating
Slide 39: Non-GAAP Reconciliation – Pre-tax Operating Income
Non-GAAP Reconciliation – Pre-tax Operating Income Full Year 2012 AIG AIG Mortgage Other ($ in millions) Property Casualty Life and Retirement Guaranty Operations Total Income (loss) from continuing operations, before tax $ 2,023 $ 3,780 $ 15 $ 3,504 $ 9,322 Adjustments to arrive at pre-tax operatin
Slide 40: Non-GAAP Reconciliation – Full Year Pre-tax Operating Income
Non-GAAP Reconciliation – Full Year Pre-tax Operating Income 40
Slide 41: Non-GAAP Reconciliation
Non-GAAP Reconciliation After-tax Operating Income Attributable to AIG Full Year ($ in millions) 2012 2013 Net income attributable to AIG $ 3,438 $ 9,085 Adjustments to arrive at After-tax operating income attributable to AIG: (Income) loss from discontinued operations (1) (84) Net (income) loss fro
Slide 42: Non-GAAP Reconciliation – BVPS ex. AOCI, Premiums & Deposits, Accident Year Combined Ratio
Non-GAAP Reconciliation – BVPS ex. AOCI, Premiums & Deposits, Accident Year Combined Ratio, As Adjusted 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 shareho
Slide 43: AIG – Bring on tomorrow
AIG] Bring on tomorrow
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