American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q1 2012 Earnings Presentation
18 slides from American International Group, Inc. New's earnings presentation, May 4, 2012
Slide 1: First Quarter 2012 Results Conference Call Presentation
American International Group, Group Inc. Inc First Quarter 2012 Results Conference Call Presentation May 4, 2012
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 projections, goals, assumptions and statements that may constitute “forward-looking statements” within the meaning of the Private Securities Li
Slide 3: First Quarter 2012 Key Themes
First Quarter 2012 Key Themes Highlights Noteworthy Items $3.0 bn share repurchase M Monetized ti d non-core assets t – AIA $6 $6.0 0 bn; b Blackstone Bl k t $0 $0.5 5bbn Insurance company distributions of $2.6 billion Continued Execution of Capital Management Issued $2.0 bn of debt in DIB /
Slide 4: Financial Highlights
Financial Highlights First Quarter ($ in millions, except earnings per share) 2012 2011 Change Revenues $18,443 $17,439 5.8% Net income attributable to AIG 3,208 1,297 147.3% After-tax operating income attributable to AIG $3,097 $2,089 48.3% Dil t d earnings Diluted i per common share: h Net Income
Slide 5: Components of After-tax Operating Income (Loss)
Components of After After-tax tax Operating Income (Loss) Core insurance operations and strong investment returns drive growth in operating income. First Quarter ($ in millions) 2012 2011 Insurance operations Chartis $1,043 ($424) SunAmerica 1,311 1,171 Mortgage Guaranty (reported in Other) 8 14 Tot
Slide 6: Capital
Capital p Execution of $3.0 bn share repurchase increased BVPS by $1.42/share. Adoption of new DAC standard reduced AIG Shareholders’ equity by $3.4 bn, or $1.80/share. Capital Structure Book Value Per Share ($ in billions, except per share data) $128.6 60.0 $57.68 $53.53 +8% 3.83 14.7 2.72 9.4 50.0
Slide 7: Non-core Assets
Non-core Non core Assets Pay down of AIA SPV preferred interest meaningfully enhances financial flexibility. Description Financial Impact on Potential Sale (At March 31, 2012) Gross Proceeds = Net Proceeds 19% stake: 2.24 bn shares AIA Carried C i d att ffair i value l $8 $8.2 2bbn Tax T gain
Slide 8: Liquidity
Liquidity q y Insurance Company Distributions ($ in millions) 3,000 $2,606 Trailing 12 months payments of $5.3 billion. 2,500 SunAmerica note repayments follow ML II 2,000 1,606 distribution. 1,500 $1,280 SunAmerica Expected annual payments of $4 – 5 billion. 1,000 505 $953 Chartis 324 $495 50
Slide 9: Chartis – Financial Highlights
Chartis – Financial Highlights Global Combined Ratios Decrease in accident year loss ratio Calendar Year Accident Year(1) 140 excluding catastrophe losses reflects shift in 118 6 118.6 mix of business to higher value lines and 120 102.1 geographies, improved pricing and 98.3 100.4 100 enhanced ris
Slide 10: Chartis – First Quarter Net Premiums Written
Chartis – First Quarter Net Premiums Written Net premiums written reflects underwriting and rate discipline. Commercial NPW ($ in millions) 6,000 $5,724 ((9%)) $5 223 $5,223 Rates in the U.S. U S and Canada region 5,000 1,022 909 increased approximately 5.2% over the 956 4,000 991 prior year perio
Slide 11: SunAmerica – Financial Highlights
SunAmerica – Financial Highlights Operating Income ($ in millions) 1,400 $1,311 Operating income in 1Q12 benefits $1,171 from improved base spreads due to 1 200 1,200 378 1,000 412 cash redeployment in 2011 and 800 disciplined management of interest 600 crediting rates. 933 400 759 The impact of
Slide 12: SunAmerica – Base Yields and Net Investment Spreads
SunAmerica – Base Yields and Net Investment Spreads Base Yields and Net spreads increased in the first quarter. Base Yields(1) 5.40% 5.17% 5.28% 5.28% 5.30% Base yields and net spreads improved in 5 20% 5.20% 1Q12 due to cash redeployment and 5.00% 5.13% 5.13% disciplined new and renewal crediting
Slide 13: United Guaranty – Overview
United Guaranty – Overview In 1Q 2012, United Guaranty generated Primary Delinquency (DQ) Ratio (%) operating income of $8 million, driven by favorable prior year development. 16.0% 15.2% 14.6% 14.1% 13.9% Nationwide pricing increase of 2%. 14.0% $6.5 billion New insurance written (NIW)(1) in
Slide 14: Appendix
Appendix 14
Slide 15: ML III Composition
ML III Composition At March 31, 2012 ML III Underlying Asset Types by Market Value ($19.9 BN) Reported in Other Operations Recorded at fair value ($6.9 billion at 9% 15% RMBS Prime Mar 31, Mar. 31 2012) RMBS Alt-A 17% Change in fair value recognized in Net 30% RMBS SubPrime Investment Income C
Slide 16: Maiden Lane III – Senior Loan Pay-Down Continues as Expected
Maiden Lane III – Senior Loan Pay Pay-Down Down Continues as Expected Cumulative cash distributions (excluding expenses) from ML III total $16.1 billion. ($ in billions) Fed Senior Loan Balance and Payment (Including Accrued Interest) Current Capital Structure 25.0 16.0 14.0 9.0 20.0 10.9 9.8 12.9 1
Slide 17: Legacy AIGFP: What We've Accomplished
Legacy g y AIGFP: What We’ve Accomplished p AIG continued to de-risk the legacy AIGFP portfolio in the first quarter. Gross Vega ($ bn)(2) 1.5 1.25 98% Net Notional Exposures ($ bn) % Reduction 1 Reduction December 31, December 31, March 31, 2008 – 2011 – Derivatives Book 2008(1) 2011 2012 2012 2012
Slide 18: Legacy AIGFP: Where We're Going
Legacy AIGFP: Where We’re We re Going Actively managing the portfolio for maximum profit contribution and limited risk. Estimated Type Average Description (1) Life AIG Derisking Activities and portfolio hedging - ~$90 $90 bn: Aggregate Value at Risk on Market Derivatives is effectively zero at a 9
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