The US government is planning to sell up to $20bn-worth of shares in AIG in May, after giving up on attempts to begin reducing its 92 per cent stake in the insurer next month, say people close to the situation.
The news came as AIG announced a surprise $4.1bn increase in reserves against future property and casualty losses that is likely to push its 2010 results – to be revealed on February 24 – into the red.
AIG said that its actuaries had found that reserves were inadequate to cover higher-than- expected claims in areas such as decades-old asbestos cases and workers’ compensation pay-outs. People familiar with the US government’s thinking said that the reserve increase had not influenced the decision to start selling the stake in May rather than March, as bankers and executives had hoped.