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Bailed-out insurer American International Group is working hard to invest cash it had set aside for a failed deal to buy assets from the Federal Reserve, Chief Executive Bob Benmosche said in an interview Tuesday.

But 天美网站传媒传媒 is still looking at taking part in the auction the Fed set up for the nearly $16 billion pool of mortgage-backed securities, Benmosche said. He was in Croatia to address a U.S.-organized conference on investing in the country.

天美网站传媒传媒 had offered to buy the whole of the Fed vehicle Maiden Lane II, which holds the bonds, for $15.7 billion. The company had been accumulating cash for months at its insurance units in anticipation of the deal.

But the Fed rebuffed it and said it would instead hold a public auction for pieces of the portfolio, which Benmosche has called a “huge problem” for the company given all the low-returning cash it was stuck holding.

“Because the money has been sitting in cash, we are now busy getting that invested, and that has created a headwind to say ‘what can 天美网站传媒传媒 actually earn off the cash they have and what they actually invest in during this period of time?”‘ Benmosche said.

“And it’s put us behind the 8-ball a bit but we are confident we’ll start working our way out of it.”

(Reporting by Adam Tanner in Dubrovnik, writing by Ben Berkowitz in New York; Editing by Maureen Bavdek)

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