AIG CEO: Taxpayers Will Get '$10 Billion' Profit
American International Group is selling assets and "cleaning up the volatility of the stock" so it can pay back the U.S. government "with a profit of at least $10 billion" whenever the US wants to sell its shares, CEO Robert Benmoshe told CNBC.
He spoke Thursday after AIG reported first-quarter earnings of $1.65 a share, beating expectations of $1.12. However, revenue came in at $8.69 billion, below expectations of $8.96 billion. Shares fell in late trading.
The "fundamentals of the company are strong," he told "Closing Bell." "I've been saying that for five quarters. We're emerging out of this crisis as an insurance company."
AIG has been shedding assets ever since the Treasury Department took over the company during the 2008 financial meltdown, including its AIA insurance unit in China and other holdings.
"As we continue to perform, as we continue to sell noncore assets [and buy back stock]...the better we do and the better people feel about our future, the faster [the government will] be able to sell their shares," Benmoshe said.
The last major noncore asset it must sell is its ILFC aircraft leasing business, but Benmoshe said the company is in no rush to sell at just any price. "This is about getting it right," he said. Much of the aircraft is so old it the planes will have to be taken apart and sold for scrap, he added.
AIG is already working to rebuild its Asia operations. Benmoshe said AIG still has insurance operations in 90 countries, including Thailand, Malaysia, Indonesia and Japan, where it is starting to sell life insurance," Benmoshe said.
Although AIG had to sell the China insurance company to pay back the U.S. government, "we still have a lot of powder left in this company. We’re still big and strong," he said.
So is Benmoshe, for now. The CEO, who disclosed last year he has cancer but is in no hurry to retire, said Thursday his doctors are "pleased with my progress and they’re confident I’ll stay strong for a while."