Policy interests protected, says AIG-Philamlife

With the current financial issues in the US affecting its parent company, American International Group, Inc. (AIG), the Philippine American Life and General Insurance Co. (Philamlife) assures its customers and policy owners that their interests are protected with the company's financial strength.

The AIG Board has announced on Sept. 16, 2008 that the Federal Reserve Bank of New York is providing a two-year $85 billion secured revolving credit facility to AIG that will ensure the company can meet its liquidity needs. The new AIG head Edward Liddy said, "The Federal Reserve Bank's decision is a tremendous vote of confidence in AIG's future."

In a statement, Philamlife president and CEO Jose Cuisia Jr., said that "Philamlife is very adequately capitalized. We have the strongest balance sheet in the life insurance industry and we continue to pursue a conservative investment strategy aimed at minimizing risks and maximizing returns to our clients."

As of Dec. 31, 2007, Philamlife has consolidated assets of P170 billion and consolidated Stockholders' Equity of P49.5 billion. In 2007, revenues amounted to P36.7 billion reflecting a 14 percent growth while New Business from Life Insurance Operations of P7.4 billion was higher by 57.6 percent versus the previous year. Benefits payments totaled P6.6 billion.

As a locally incorporated company, Philamlife is subject to Philippine Insurance Commission (IC) regulations and oversight. Philamlife's capitalization is separate from the US business with investments and accounts held locally. As of Dec. 31, 2007, Philamlife's consolidated investments amounted to P164.2 billion (at market). The bulk of invested assets are concentrated in marketable Philippine government securities, corporate bonds and blue chip equities.

Philamlife is capable of meeting its obligation to its clients and providing them with quality service. -

The AIG Board has announced on Sept. 16, 2008 that the Federal Reserve Bank of New York is providing a two-year $85 billion secured revolving credit facility to AIG that will ensure the company can meet its liquidity needs. The new AIG head Edward Liddy said, "The Federal Reserve Bank's decision is a tremendous vote of confidence in AIG's future."

In a statement, Philamlife president and CEO Jose Cuisia Jr., said that "Philamlife is very adequately capitalized. We have the strongest balance sheet in the life insurance industry and we continue to pursue a conservative investment strategy aimed at minimizing risks and maximizing returns to our clients."

As of Dec. 31, 2007, Philamlife has consolidated assets of P170 billion and consolidated Stockholders' Equity of P49.5 billion. In 2007, revenues amounted to P36.7 billion reflecting a 14 percent growth while New Business from Life Insurance Operations of P7.4 billion was higher by 57.6 percent versus the previous year. Benefits payments totaled P6.6 billion.

As a locally incorporated company, Philamlife is subject to Philippine Insurance Commission (IC) regulations and oversight. Philamlife's capitalization is separate from the US business with investments and accounts held locally. As of Dec. 31, 2007, Philamlife's consolidated investments amounted to P164.2 billion (at market). The bulk of invested assets are concentrated in marketable Philippine government securities, corporate bonds and blue chip equities.

Philamlife is capable of meeting its obligation to its clients and providing them with quality service.

(Philstar News Service)

Head of AIG Singapore unit resigns

SINGAPORE (AFP)- The head of the Singapore subsidiary of troubled global insurance giant American International Group (AIG) has resigned, the company said in a statement.

It said late Thursday Mark O'Dell's departure was "in no way related to the recent developments at AIG," whose Singapore subsidiary has been thronged by hundreds of anxious policyholders worried over the future of the parent company.

A statement from American International Assurance Company Limited (AIA) said O'Dell had resigned and taken immediate leave of absence from his position as executive vice-president and general manager of AIA Singapore.

"It is a personal decision that he has been planning for some time," the statement said.

Effective Friday, Kenneth Juneau will lead the company until a new general manager is found, the statement said. Juneau is executive vice president and senior regional life executive of AIA's regional office.

O'Dell resigned on the same day he took out a full-page newspaper advertisement to reassure AIA's customers about the company.

Despite short-term liquidity pressures at AIG, the Singapore unit is a "strong, well-positioned business," O'Dell wrote in the advertisement.

Local newspapers reported that O'Dell will join a rival company.

Attempts by AFP to reach him were unsuccessful. He has also resigned as president of the Life Insurance Association of Singapore, a member of staff there said.

Hundreds of customers lined up outside the AIA Singapore offices this week, hoping to terminate their policies or to seek answers after the US Federal Reserve announced a bailout of AIG.

On Friday the queues had gone, and only a few dozen people were inside the customer service area. A staff member said some were making inquiries, others hoped to cancel their policies, and some wanted to reinstate them.

The US government will give an unprecedented loan of up to 85 billion dollars to AIG in a bid to avert its collapse and a global financial calamity.

Singapore's de facto central bank, the Monetary Authority of Singapore (MAS), said that apart from O'Dell there were no other changes in AIA Singapore's management.

"We are satisfied with the ability of the company to carry on business as usual and to meet new demands even when there are any changes in management," it said in a statement, adding that MAS's regulatory oversight was "rigorous".

But some customers were not impressed by the timing of O'Dell's departure.

"He should have been gracious enough to wait for this crisis to settle down," said Daniel Chan, 50, a college lecturer who said he was considering what to do with his policy. He said he was unlikely to cancel, partly because he trusted the local regulators.

Lynn Siew, another client making inquiries, said O'Dell's resignation "just added to the gloom. It was very irresponsible."

AIA in Singapore and Hong Kong said only a fraction of policyholders had cancelled, and announced measures to woo back their clients.

More than 1,200 customers, seeking to end their policies or get cash loans from the firm in case it went bankrupt, descended Wednesday on the office of the AIG subsidiary in downtown Taipei. The number fell sharply on Thursday.

In Brunei, there were no queues but some concerned policyholders wanted to terminate their agreements, the Borneo Bulletin reported Thursday.

Like other regional units of AIG, the Brunei subsidiary issued a statement saying the local business remained sound.

Analysts from Moody's Investors Services said in a report that AIG's core insurance operations are fundamentally solid, but subject to "substantial reputational risk" because of the recent market turmoil.

"It will take time to determine the extent to which recent events may have weakened the companies' standing in the market," Moody's said.

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AIG STATEMENT ON ANNOUNCEMENT BY FEDERAL RESERVE BOARD OF $85 BILLION SECURED REVOLVING CREDIT FACILITY ADDRESSES LIQUIDITY ISSUES

Contact: Charlene Hamrah (Investment Community) 212-770-7074
Nicholas Ashooh (News Media) 212-770-3523
AIG STATEMENT ON ANNOUNCEMENT BY FEDERAL RESERVE BOARD OF $85 BILLION SECURED REVOLVING CREDIT FACILITY
ADDRESSES LIQUIDITY ISSUES AND POLICYHOLDER CONCERNS
NEW YORK, September. 16, 2008 - The Board of Directors of American International Group, Inc. (NYSE:AIG) issued the following statement in response to today’s announcement by the Federal Reserve Board that the Federal Reserve Bank of New York is providing a two-year, $85 billion secured revolving credit facility to AIG that will ensure the company can meet its liquidity needs:

“The AIG Board has approved this transaction based on its determination that this is the best alternative for all of AIG’s constituencies, including policyholders, customers, creditors, counterparties, employees and shareholders. AIG is a solid company with over $1 trillion in assets and substantial equity, but it has been recently experiencing serious liquidity issues. We believe the loan, which is backed by profitable, well-capitalized operating subsidiaries with substantial value, will protect all AIG policyholders, address rating agency concerns and give AIG the time necessary to conduct asset sales on an orderly basis. We expect that the proceeds of these sales will be sufficient to repay the loan in full and enable AIG’s businesses to continue as substantial participants in their respective markets. In return for providing this essential support, American taxpayers will receive a substantial majority ownership interest in AIG.
“We commend the Federal Reserve and the Treasury Department for taking this decisive action to address AIG’s liquidity needs and broader financial market concerns. We thank them for their leadership during this critical time for the global financial markets. We also thank Governor Paterson, Commissioner Dinallo, Commissioner Ario, the other state Commissioners, and the Office of Thrift Supervision for their willingness to assist AIG.
“Policyholders of AIG companies around the world can rest assured that AIG’s commitments will continue to be honored.”


It should be noted that the remarks made in this press release may contain projections concerning financial information and statements concerning future economic performance and events, plans and objectives relating to management, operations, products and services, and assumptions underlying these projections and statements. It is possible that AIG's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these projections and statements. Factors that could cause AIG's actual results to differ, possibly materially, from those in the specific projections and statements are discussed in Item 1A. Risk Factors of AIG's Annual Report on Form 10-K for the year ended December 31, 2007, and in Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations of AIG's Quarterly Report on Form 10-Q for the period ended June 30, 2008. AIG is not under any obligation (and expressly disclaims any such obligations) to update or alter its projections and other statements whether as a result of new information, future events or otherwise.

American International Group, Inc. (AIG), a world leader in insurance and financial services, is the leading international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo.