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The U.S. Treasury Department said it received an additional repayment of $972 million from American International Group (ÌìÃÀÍøÕ¾´«Ã½´«Ã½).

The payment came mostly from the scheduled release of the escrow from ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s sale of its American Life Insurance to MetLife last year.

The proceeds are used to pay back the government investment in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ by redeeming an equal portion of Treasury’s preferred equity interests in AIA Aurora, a special purpose vehicle (SPV) that was created to assist ÌìÃÀÍøÕ¾´«Ã½´«Ã½. Treasury announced the latest ÌìÃÀÍøÕ¾´«Ã½´«Ã½ repayment on Tuesday, Nov. 1.

The remaining liquidation preference Treasury holds in the AIA Aurora is now reduced to $8.4 billion.

At the height of U.S. financial crisis, the U.S. government’s support for ÌìÃÀÍøÕ¾´«Ã½´«Ã½ totaled $182.3 billion.

Remaining Gov’t Investments/Loans Down to $67.5B

After this latest repayment, the U.S. government’s remaining outstanding investment in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ through Treasury (including common and preferred interests) stands at $50 billion.

Additionally, the Federal Reserve Bank of New York has loans to special purpose vehicles (SPVs) to assist ÌìÃÀÍøÕ¾´«Ã½´«Ã½ that amount to $17.5 billion, including principal and accrued interest outstanding. These Federal Reserve Bank of New York loans are collateralized by assets with a current value of $30.7 billion.

In January 2011, ÌìÃÀÍøÕ¾´«Ã½´«Ã½ completed a recapitalization deal, resulting in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ repaying all outstanding loans provided by the Federal Reserve Bank of New York. Also at that time, Treasury received 1.655 billion shares of ÌìÃÀÍøÕ¾´«Ã½´«Ã½ common stock (92 percent of ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s outstanding common stock) and $20.3 billion in preferred equity interests in ÌìÃÀÍøÕ¾´«Ã½´«Ã½.

Since then, Treasury sold 200 million shares of ÌìÃÀÍøÕ¾´«Ã½´«Ã½ for $5.8 billion and ÌìÃÀÍøÕ¾´«Ã½´«Ã½ made payments to Treasury, including the repayment announced this week, of $12.4 billion on the preferred equity interests.

“We continue to make steady progress toward our goal of America’s taxpayers recouping their entire investment in ÌìÃÀÍøÕ¾´«Ã½´«Ã½,” said ÌìÃÀÍøÕ¾´«Ã½´«Ã½ President and CEO Robert Benmosche. “I am confident that ÌìÃÀÍøÕ¾´«Ã½´«Ã½’s employees will continue to work hard so we can achieve this goal.”

ÌìÃÀÍøÕ¾´«Ã½´«Ã½ said the money paid this week is the sixth major payment to the government in 2011 and brings the total repaid in 2011 to $45 billion.

Topics USA New York ÌìÃÀÍøÕ¾´«Ã½´«Ã½