Hot stocks to watch this afternoon: GPRO, HAS, MU >>> READ MORE

Hey, Government, AIG Wants Its Shares Back

Insurer is looking to buy back shares owned by the Treasury


American International Group (NYSE:AIG) has been stacking its pennies and dimes recently — and now has accumulated billions of dollars in cash.

What’s the company saving up for? Nothing new or fancy — just shares of itself, that are currently owned by the U.S. government.

Right now, the government owns a 61% stake in the company thanks to the financial-industry bailout that took place around four years ago.

With all the cash AIG has, though, along with some it expects to be bringing in, the insurer could be able to repay its bailout sooner than originally expected. In fact, the government’s stake could be cut as low as 30% before the presidential election rolls around.

The downside, though, is that effectively buying back shares and reducing the government’s control will simply mean increasing the Federal Reserve’s control. The Fed will instead toughly regulate AIG once the government doesn’t own a majority stake, meaning AIG would become subject to “stress tests” by the agency.

The actual buyback of the shares, though, is dependent on future asset sales that must go as planned to make such talk a reality.

Article printed from InvestorPlace Media,

©2017 InvestorPlace Media, LLC