WASHINGTON–American International Group shareholders will apparently get no say in the running of the company under the conditions of the loan the U.S. government is providing the company to help deal with its liquidity crisis.

Moreover, until it is reconfigured and pays off the loan, AIG will have to pay 8.5 percent interest even on the unused portion of the loan, and was forced to pay a 2 percent upfront commitment fee to the government in order to get the loan, according to details released yesterday.

On the $35 billion that AIG has borrowed so far the company will pay 8.5 percent on top of the current LIBOR rate of 3 perecent.

Recommended For You

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
  • Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
NOT FOR REPRINT

© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.