April 6 (Bloomberg) - American International Group Inc. seeks to boost returns on its investment portfolio cash after the Federal Reserve Bank of New York rejected the bids of the insurer to buy mortgage bonds in its rescue plan.
"Right now, we need to come up with a performance," Chief Executive Robert Benmosche, 66, said today in an interview at his villa in Dubrovnik (Croatia). "We look for in a broad spectrum of investments".Benmosche redesigns investment portfolio of the company based in New York as returns pressure near-record low interest rates and the Department of the Treasury of the United States is preparing to sell its stake in the insurer to private investors. Rivals, including Warren Buffet Berkshire Hathaway Inc. and Allstate Corp., have reduced the duration of the investment, predicting interest rates will increase.The New York Fed is sale of former mortgage bonds of the AIG block after refusing an offer for AIG to buy the whole pool, called Maiden Lane II, $ 15.7 billion. "Even with winds that have been created in reason for not purchasing Maiden Lane II, still believe us that the taxpayer will recover at least what they gave us, the principal and interest," said Benmosche.AIG has sold more than 50 billion dollars in assets "including non-American life units to repay a Fed credit line. Plans of the Treasury Board to dispose of its set of 92%, more than 55 billion dollars based on the price of closing of yesterday, in bids to recover its investment.The Fed held its rate target of loan overnight at zero to 0.25% since December 2008, reducing the borrowing costs and the decrease in yields for investors.Investment income rose 10% of the IncomeAIG of the investment to 5.46 billion in the three months ending December 31 as alternative assets, including private placements and fund holdings, generated coverage 650 million against 443 million dollars a year earlier. Company was $ 1.56 billion, in cash and short-term investments $ 42.2 billion to its subsidiaries at the end of last year, according to a report on its site Web.En February, David Herzog Financial Director of AIGsaid that the company provides that "the redeployment of cash and investments in the short term in higher long-term yield securities will provide an opportunity to improve future earnings.""Buffett, 80, President and CEO of Omaha, Nebraska-based Berkshire, said last month that he would recommend against buying long-term bonds denominated in U.S. dollars."If you ask me if the US dollar will keep its authority to purchase fully at the 2011 level, 5 years, 10 years or 20 years, I would say that it will not," Buffett said in New Delhi March 25 .three-an PlanBenmosche, who says personal in October that he has been treated for cancer, said his health is "OK" and that it continues to exercise. AIG said last year that President Steve Miller is available to be CEO Benmosche walking down before a permanent successor is named. Benmosche, who became CEO in 2009, said that he intends to complete three years on the job. "I would like to see all the stocks of the Council sold a Treasury and comfortable that we have a sustainable organization and the management team, that AIG if it hits some new bumps in the road will not be a problem,"he said today."-Editors: Dan Reichl, William Ahearn
To contact the reporters on this story: Boris Cerni Ljubljana to bcerni@bloomberg.net; Noah Buhayar in New York at nbuhayar@bloomberg.net.
To contact the editor responsible for this story: Dan Kraut in New York at the dkraut2@bloomberg.net
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