Predictably, the Republicans who all bragged about what a sweetheart deal this would be are nowhere to be found. They’re the same ones who wanted to get similar sweetheart deals on Wall Street because it would pay so well. Uh huh.
Embattled insurance giant American International Group, set to reveal its latest financial results on Monday, is reportedly close to securing a new bailout deal from the federal government.
The Wall Street Journal, citing sources familiar with the matter, reported Sunday evening that AIG’s board was close to approving significant changes to the terms of the $123 billion in loans extended so far, and might announce a revised $150 billion deal as early as Monday.
Details were still in flux, but under the plan being discussed Sunday night, the government would cut the interest rate AIG is paying and use its authority under last month’s $700 billion bailout law to buy $40 billion in preferred shares, the Journal said.
The government would also stand behind billions of dollars in credit default swap agreements – essentially insurance contracts that AIG had sold to customers worldwide, according to the Journal. Finally, it would backstop AIG’s business of securities lending.