Text Insurance regulators will be looking into the practice of insurers lending securities to third parties, said New York Insurance Department spokesman David Neustadt.
His comments came after AIG yesterday secured $37.8 billion from the Fed for AIG to borrow overnight to meet liquidity needs of life insurance units. The additional borrowings will be collateralized by investment-grade, fixed-income securities held by AIG's life insurance subsidiaries.
The latest credit arrangement is separate from the $85 billion loan authorization that AIG secured from the Fed last month in exchange for giving the government a 79.9 percent interest in the firm.
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