AIG and a Federal Reserve-created firm agreed to pay $62 billion to settle derivative transactions with 16 investment banks, getting in return securities whose market value has fallen below $30 billion, according to a regulatory filing.
The troubled insurer and Maiden Lane III, a Fed vehicle created to bail out AIG, had said their plan to settle the beleaguered firm’s credit-default swaps, but hadn’t disclosed details related to the derivatives’ value and the amounts paid.
An AIG representative said nobody at the company was immediately available to discuss the disclosure, which was made Monday in a Securities and Exchange Commission filing.
Société Genéralé and Goldman Sachs were the biggest beneficiaries. SocGen held derivatives with a notional value of $16.4 billion, but a negative mark-to-market of $8.4 billion, according to the filing.
The French firm initially received nearly $9.6 billion as collateral from AIG, and Maiden Lane made up the difference of nearly $6.9 billion, according to AIG disclosures.
Goldman Sachs held derivatives with a notional value of $14 billion, but a negative mark-to-market of $8 billion. AIG posted collateral of $8.4 billion and Maiden Lane added $5.6 billion to make up the difference.
