AIG Fights to Buy Back Its Own Crap Assets, NY Fed Isn't Having Any of That
Poor AIG, anyone else crying a river for them? This is what happens when you need the government and the Bernanke Mafia to come save you. I find it hilarious that AIG's Benmosche believes he is the one in charge of the company when, in fact, the government/Bernanke Mafia are majority owners.
The Federal Reserve Bank of New York’s rejection of the American International Group’s offer to buy back $15.7 billion worth of mortgage securities poses a big problem for the insurer, the company’s chief executive said on Wednesday.
Instead of selling the entire Maiden Lane II portfolio of securities back to A.I.G., the New York Fed instead has chosen to sell off pieces over time, potentially opening up the sales process to other bidders.
But Robert H. Benmosche, A.I.G.’s chief executive, argues that it could potentially weaken the insurer’s financial position.
“It’s a huge problem for us,” he told DealBook in a telephone interview.
The decision, he said, also took him by surprise. Mr. Benmosche said he was notified of the New York Fed’s plan only by a phone call at 4 p.m. on Wednesday.
Here's the obvious issue, the New York Fed needs to make the most it can off this deal lest they be accused of squandering taxpayer money. I'm not sure when we hired them to manage our tax portfolio but we'll save that discussion for another day.
Credit Suisse Group AG (CSGN), Barclays Plc (BARC) and Morgan Stanley are each seeking groups of investors to counter American International Group Inc. (AIG)’s $15.7 billion bid for a pool of mortgage bonds held by the Federal Reserve Bank of New York, people with knowledge of the discussions said.
The dealers are among bond brokers gauging whether they can assemble bids from customers that would beat AIG’s offer if the Fed decides to sell the assets, according to the people, who declined to be identified because the talks are private. Banks have told clients that the New York Fed, which hired BlackRock Inc. (BLK) to manage the portfolio, probably isn’t ready for bids or to decide on the sales process, the people said.
AIG, which is 92 percent-owned by the U.S. government, made public on March 10 its offer for the assets, which the insurer turned over to a Fed fund in 2008. AIG said its proposal would benefit taxpayers by boosting investment returns at the company as it seeks to attract private capital to replace government funds. The New York Fed said March 11 it’s seeking a solution that “maximizes the proceeds to the taxpayer.”
Maybe NY Fed should just hang onto this crap a little bit longer, that way when the wheels fall off this thing, they'll be the ones left holding the bag. They were all too happy to unload most of AIG on the Treasury, makes one wonder what sort of sentimental attachment they have to these damn bonds. What gives? When AIG was failing no one wanted this shit, now look at them fighting to get a piece!
This money laundering shit is complicated!