American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q2 2012 Earnings Presentation
18 slides from American International Group, Inc. New's earnings presentation, Aug 3, 2012
Slide 1: American International Group, Inc. Second Quarter 2012 Results
American International Group, Inc. Second Quarter 2012 Results Conference Call Presentation August 3rd, 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, and officers and representatives of American International Group, Inc. (AIG) may from time to time make, projections, goals, assumptions and s
Slide 3: Second Quarter 2012 Key Themes
Second Quarter 2012 Key Themes Highlights Noteworthy Items $2.0 billion shares repurchased ($5.0 billion YTD) Through 8/2, received proceeds of $6.1 billion on ML III interest with an additional $1.9 billion expected mid-August Continued Execution of Capital Management Through 8/2, AIG purchas
Slide 4: Financial Highlights
Financial Highlights Second Quarter ($ in millions, except earnings per share) 2012 2011 Change Revenues $17,123 $16,680 3% Net income attributable to AIG 2,332 1,836 27% After-tax operating income attributable to AIG $1,858 $1,240 50% Diluted earnings per common share: Net Income attributable to AI
Slide 5: After-tax Operating Income (Loss)
After-tax Operating Income (Loss) Improvement in insurance operations drives growth in operating income. Second Quarter ($ in millions) 2012 2011 Insurance operations Chartis $936 $783 SunAmerica 933 723 Mortgage Guaranty (reported in Other) 43 12 Total Insurance Operations 1,912 1,518 Aircraft Leas
Slide 6: Strong Capital Position
Strong Capital Position Execution of $5.0 billion share repurchases year-to-date increased BVPS by $2.34/share. Capital Structure Book Value Per Share ($ in billions, except per share data) $130.7 64.0 $60.58 $15.8 +13% $4.51 56.0 $53.53 $9.3 $2.72 48.0 (1) Financial Debt 40.0 Hybrids 32.0 $56.07 $1
Slide 7: Financial Flexibility – A Source of Strength
Financial Flexibility – A Source of Strength Insurance Company Distributions ($ in millions) 3,000 $2,606 Year-to-date distributions of $3.9 billion. 2,500 2,000 Expected annual payments of $4 – 5 billion. $1,606 1,500 $1,280 $1,326 $953 1,000 $505 $807 $324 500 $775 $1,000 * $629 $519 0 3Q11 4Q
Slide 8: Maiden Lane III Interest – Liquidation Value at June 30, 2012
Maiden Lane III Interest – Liquidation Value at June 30, 2012 At June 30, 2012, the FRBNY Senior Loan to Maiden Lane III has been fully repaid. ($ in billions) FRBNY Senior Loan $9.0 AIG Equity Interest & Accrued Distributions $5.6 AIG Equity Interest & Accrued Distributions $5.6 $8.2* $7.4* Residua
Slide 9: Maiden Lane II and Maiden Lane III – Purchases
Maiden Lane II and Maiden Lane III – Purchases AIG has received proceeds of $6.1 billion from ML III completely recovering its equity interest and accrued distributions. Additional $1.9 billion expected mid-August. Maiden Lane II Maiden Lane III ($ in billions) Estimated Fair Value at $20.5 $29.3 In
Slide 10: Chartis – Financial Highlights
Chartis – Financial Highlights Global Combined Ratios Decrease in accident year loss ratio excluding Calendar Year Accident Year(1) catastrophe losses reflects shift in mix of business 120 to higher value lines and geographies, improved 104.0 102.4 97.7 98.3 pricing and enhanced risk selection too
Slide 11: Chartis – Net Premiums Written
Chartis – Net Premiums Written Net premiums written reflect continued business mix shift and enhanced risk selection. Commercial NPW ($ in millions) $5,723 $5,564 Global commercial rates increased 5.5% 6,000 (3%) $997 over the prior year period (8% for the U.S.) 5,000 $1,076 $875 led by Property a
Slide 12: SunAmerica – Financial Highlights
SunAmerica – Financial Highlights Operating Income Operating income in 2Q12 benefited ($ in millions) from improved base net investment 1,000 $933 spreads mainly due to cash +29% 800 $723 redeployment in 2011 and disciplined $338 management of interest crediting rates. 600 $222 The year ago peri
Slide 13: SunAmerica – Base Yields and Net Investment Spreads
SunAmerica – Base Yields and Net Investment Spreads Base Yields and Net spreads increased in the second quarter. Base Yields(1) 5.40% 5.28% 5.30% 5.33% Base yields and base net investment 5.30% 5.28% spreads improved in 2Q12 mainly due to 5.17% 5.20% cash redeployment and disciplined new and renew
Slide 14: SunAmerica – Proactively Addressing Sustained Low Interest Rates
SunAmerica – Proactively Addressing Sustained Low Interest Rates 2012 Management Actions Effect of Low Rates on Annual Earnings(1) $ in millions 2012 2013 2014 2015 Continued disciplined Estimated impact on approach to new business pre-tax operating $0 – ($50) – ($110) – ($180) – ($10) ($60) ($125
Slide 15: Mortgage Guaranty – Improving Trends
Mortgage Guaranty – Improving Trends In 2Q 2012, Mortgage Guaranty generated $8.5 billion new insurance written (NIW)(1) in operating income of $43 million, driven by 2Q 2012 with consistently high quality risks. favorable prior year development and a decline in new delinquencies. NIW ($ in bill
Slide 16: Appendix
Appendix 16
Slide 17: Legacy AIGFP: What We've Accomplished
Legacy AIGFP: What We’ve Accomplished AIG will continue to reduce the risk of the legacy AIGFP portfolio with the goal of retaining the maximum economic benefit possible. (1) Gross Vega ($ billion)(2) 1.5 1.25 98% Net Notional Exposures ($ billion) % Reduction 1 Reduction December December 2008 – 20
Slide 18: Legacy AIGFP: Where We're Going
Legacy AIGFP: Where We’re Going Actively managing the portfolio for maximum economic benefit and limited risk. Estimated (1) Type Average Description Life AIG Derisking Activities and portfolio hedging - ~$84 billion: Aggregate Value at Risk on Market Derivatives is effectively zero at a 95% confi
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