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AIG on Track to Repay Bailout: CEO Benmosche

Having gone to the government for $180 billion in bailout money, American International Group is now on track to realign its business and paying back U.S. taxpayers, Chief Executive Robert Benmosche told CNBC on Wednesday.

"We're going to do it first by raising a lot of cash," Benmosche said. "What's important is that we pay the Federal Reserve credit facility [in full.]"

Benmosche said the U.S. Treasury could convert preferred AIG shares it holds into common stock, which Benmosche says could even present a profit.

"[AIG] stock will sell as we continue to perform," Benmosche said. "If you look at how we're earning money, you will see that to the extent the stock has value based on our performance, which we think is there, the Treasury will come out not only with their money, but with a profit."

Upon conversion, the Treasury could own as much as 92 percent of AIG .

Despite posting a $2.4 billion third-quarter loss last Friday, Benmosche said he sees the company's earnings rising steadily, with potential profit of $6 to $8 billion in 2011

AIG recently raised $37 billion with the sale of two of its foreign insurance businesses. That came amid heavy restructuring efforts to trim AIG back down to its core operations, which will include four main lines of business — property casualty insurance, life annuity, aircraft leasing, and mortgage guarantee.

Amid AIG's turnaround efforts, Benmosche recently announced he was diagnosed with cancer and has begun began chemotherapy.

"I'm feeling fine," Benmosche said. "Cancer is a very difficult thing to face. I'm going to be optimistic that I'll be able to see my way through this restructuring and, in fact, see the government sale of its position and even be healthy enough to go back to my retirement."