American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q1 2013 Earnings Presentation
22 slides from American International Group, Inc. New's earnings presentation, May 3, 2013
Slide 1: First Quarter 2013 Results Conference Call Presentation
American International Group, Inc. First Quarter 2013 Results Conference Call Presentation May 3, 2013
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: First Quarter 2013 Key Themes
First Quarter 2013 Key Themes Highlights: Noteworthy Items Parent liquidity of $15.0 billion Dividends and loan repayments of $1.3 billion from AIG Life and Retirement Liquidity and Capital $2.1 billion in parent company liability management ($1.1 billion hybrid call and $1.0 billion in tender
Slide 4: Financial Highlights
Financial Highlights First Quarter Inc. ($ in millions, except per share amounts) 2012 2013 (Dec.) Revenues $17,497 $15,888 (9%) Net income attributable to AIG 3,208 2,206 (31%) After-tax operating income attributable to AIG $3,046 $1,982 (35%) Diluted earnings per common share: Income from continui
Slide 5: After-tax Operating Income
After-tax Operating Income Operating results benefit from strong investment returns and modest catastrophe losses. First Quarter ($ in millions, except per share amounts) 2012 2013 Insurance operations AIG Property Casualty $1,043 $1,589 AIG Life and Retirement 1,311 1,394 Mortgage Guaranty (reporte
Slide 6: Strong Capital Position
Strong Capital Position Outstanding borrowings reflect first quarter hybrid call and tender offers. Capital Structure Book Value Per Share ($ in billions, except per share data) 70.0 $66.38 $67.41 $124.1 $123.2 $0.7 $0.7 $8.51 $8.02 $16.1 $15.6 60.0 Non-redeemable $9.4 $7.4 noncontrolling 50.0 inter
Slide 7: Financial Flexibility – A Source of Strength
Financial Flexibility – A Source of Strength Parent liquidity balance reflects subsidiary distributions and liability management actions during the quarter. Insurance Company Distributions Parent Liquidity ($ in millions) ($ in billions) AIG Property Casualty AIG Life and Retirement $16.1 1,600 $0.5
Slide 8: AIG Property Casualty – Financial Results
AIG Property Casualty – Financial Results Operating results demonstrate continued execution of strategic initiatives. ($ in millions) 1Q12 1Q13 Global Combined Ratios Calendar Year Accident Year, Net premiums written $8,820 $8,437 as adjusted(1) 120 102.1 100.4 97.3 97.2 Net premiums earned 8,688 8,
Slide 9: Commercial Insurance – Underwriting Results
Commercial Insurance – Underwriting Results Commercial results reflect business mix shift, enhanced risk selection, and price increases. Net Premiums Written ($ in millions) Commercial Insurance continued to focus on growing higher value, profitable lines of business and geographies. 6,000 $5,223
Slide 10: Consumer Insurance – Underwriting Results
Consumer Insurance – Underwriting Results Consumer continues to implement global growth strategies across multiple distribution channels. Net Premiums Written ($ in millions) 4,000 $3,597 Consumer Insurance represented 42% of total AIG Property $3,532 Casualty NPW in 1Q13. 3,000 $1,790 $1,739 Co
Slide 11: AIG Property Casualty – Investments
AIG Property Casualty – Investments Returns driven by strong alternative investment income and gains on fair value option securities. Net investment income: First Quarter ($ in millions) 2012 2013 Inc./(Dec.) Interest and dividends $ 990 $ 936 (5%) Alternative investments 130 258 98% (1) Other, net
Slide 12: Mortgage Guaranty – Improving Trends
Mortgage Guaranty – Improving Trends 1Q13 operating income of $41 million reflects growing portion of premium from high quality business written since 2009 and declining losses from run-off of legacy exposure. New Insurance Written (NIW)(1) Primary Delinquency (DQ) Ratio (%) ($ in billions) 12.0% Gr
Slide 13: AIG Life and Retirement – Financial Results
AIG Life and Retirement – Financial Results Results reflect active management of net investment spreads and strong alternative investment income. ($ in millions) 1Q12 1Q13 Premiums and deposits $5,560 $5,580 Operating income in 1Q13 reflects strong alternative investment income, active net investm
Slide 14: AIG Life and Retirement – Revised Segment Structure
AIG Life and Retirement – Revised Segment Structure The chart below shows the products under the previous operating segments and their mapping to the new operating segments. New Operating Retail Institutional Segments Life Insurance Retirement Income Institutional Businesses Fixed Annuities Group Re
Slide 15: AIG Life and Retirement – Retail & Institutional Results
AIG Life and Retirement – Retail & Institutional Results Retail Operating Income* Institutional Operating Income* ($ in millions) ($ in millions) 1,000 800 $821 800 $761 600 $573 $173 $550 $166 600 $213 $242 400 400 $380 $427 200 200 $325 $326 $213 $214 0 0 1Q12 1Q13 1Q12 1Q13 Life Insurance and A&H
Slide 16: AIG Life and Retirement – Investments
AIG Life and Retirement – Investments Investment performance driven by strong alternative investment returns. Net investment income: First Quarter ($ in millions) 2012 2013 Inc./(Dec.) Interest and dividends $ 2,385 $ 2,307 (3%) Alternative investments 282 489 73% Change in fair value of Maiden Lane
Slide 17: AIG Life and Retirement – Base Yields and Spreads
AIG Life and Retirement – Base Yields and Spreads Base Yields(1) Base Net Investment Spreads(1) 6.00% 3.00% 5.60% 5.26% 5.31% 2.50% 5.12% 5.12% 2.13% 2.18% 2.19% 5.10% 5.20% 1.97% 1.98% 5.19% 5.23% 2.00% 4.80% 5.01% 4.95% 1.96% 4.85% 1.91% 1.50% 1.75% 1.69% 1.75% 4.40% 4.00% 1.00% 1Q12 2Q12 3Q12 4Q1
Slide 18: Q&A
AIG Q&A
Slide 19: Appendix
AIG Appendix
Slide 20: Legacy AIGFP: What We've Accomplished
Legacy AIGFP: What We’ve Accomplished AIG will continue to de-risk the legacy AIGFP portfolio while ensuring the firm retains the maximum economic benefit possible. Net Notional Exposures ($ in billions) Gross Vega ($ in billions)(2) 1.5 1.25 % Reduction 99% Dec. 31, Dec. 31, Mar. 31, 1 Reduction De
Slide 21: Legacy AIGFP Derivatives: Largely Wound Down
Legacy AIGFP Derivatives: Largely Wound Down Actively managing the portfolio for maximum profit contribution and with limited risk. Estimated Type Average Description Life AIG Derisking Activities and Portfolio Hedging - ~$73 billion: Bulk of risk related to interest rates, foreign exchange and eq
Slide 22: AIG
AIG
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