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AIG Reports Fourth Quarter Operating Income of $290 Million, Including After-Tax Storm Sandy Losses of $1.3 Billion; Fourth



  AIG Reports Fourth Quarter Operating Income of $290 Million, Including
  After-Tax Storm Sandy Losses of $1.3 Billion; Fourth Quarter Net Loss of
  $4.0 Billion

  * Fourth quarter net loss reflects $4.4 billion net loss on sale from
    discontinued operations (International Lease Finance Corporation)
  * Book value per share, excluding accumulated other comprehensive income
    (AOCI), of $57.87, up 15.5 percent for the year
  * Remaining AIA shares sold for $6.5 billion and a realized gain of $240
    million
  * Department of the Treasury sells last of its AIG shares

Business Wire

NEW YORK -- February 21, 2013

American International Group, Inc. (NYSE: AIG) today reported a net loss of
$4.0 billion, or $2.68 per diluted share, for the fourth quarter ended
December 31, 2012, compared with net income of $21.5 billion, or $11.31 per
diluted share, in the prior year quarter. Full year 2012 net income was $3.4
billion, or $2.04 per diluted share, compared with $20.6 billion, or $11.01
per diluted share, for the full year of 2011.

After-tax operating income in the 2012 fourth quarter was $290 million, or
$0.20 per diluted share, compared with $1.5 billion, or $0.77 per diluted
share, in the prior year quarter. After-tax operating income for the full year
of 2012 was $6.6 billion, or $3.93 per diluted share, compared with $2.1
billion, or $1.16 per diluted share, in 2011.

Fourth quarter and full year 2012 results included pre-tax catastrophe losses
from Storm Sandy of $2.0 billion ($1.3 billion after-tax). Net income for the
fourth quarter and full year of 2012 included a $4.4 billion net loss on sale
from discontinued operations associated with the agreement to sell
International Lease Finance Corporation (ILFC), which reduced book value per
share by $2.97 per share. Net income for the fourth quarter and full year of
2011 reflected a U.S. consolidated income tax deferred tax asset valuation
allowance release of $19.3 billion and $18.4 billion, respectively.

“AIG’s operating profit this quarter shows the power and financial strength of
our diverse global franchise,” said Robert H. Benmosche, AIG President and
Chief Executive Officer. “We achieved these operating profits in spite of
Storm Sandy – the second largest single catastrophe event for AIG in the U.S.
These results show how the people of AIG are working together and getting the
job done.

“In so many ways, this was an historic quarter -- from the positive return we
delivered to the American taxpayers on the investment in AIG, to our ability
to monetize non-core assets, and to again becoming a unified AIG. When history
is written, we will look back and see that by the end of 2012, a new era for
AIG had begun. As one AIG, we will expand on our accomplishments. Teams from
our core businesses are working together, sharing experiences, and providing
complementary skill sets to create new opportunities and better serve our
customers. This partnership is AIG’s global foundation for growth.”

Mr. Benmosche concluded, “We still have work to do, but we have confidence in
the opportunities we will create in 2013 and beyond. We remain committed to
investing in our business, but expect to take continued actions to improve our
efficiencies through technology and streamlined work processes.”

Liquidity, Capital Management, and Other Significant Developments

  * AIG shareholders’ equity totaled $98.0 billion at December 31, 2012.
  * During the fourth quarter of 2012, the U.S. Department of the Treasury
    (Treasury) completed a registered public offering of its remaining shares
    of AIG Common Stock for proceeds of approximately $7.6 billion, marking
    the full repayment of America’s financial support of AIG. Since 2008,
    through asset sales and other actions by AIG, the Federal Reserve, and
    Treasury, the U.S. Government recovered its full $182.3 billion commitment
    to AIG, plus a combined positive return of $22.7 billion. Treasury
    continues to hold warrants to purchase approximately 2.7 million shares of
    AIG common stock, the sale of which is expected to provide an additional
    positive return to taxpayers.
  * In December 2012, AIG sold its remaining stake of approximately 1.65
    billion ordinary shares of AIA Group Limited (AIA) recognizing gross
    proceeds of approximately $6.5 billion and a gain of $240 million. For the
    full year, AIG recognized gains of $2.1 billion from AIA.

  * In December 2012, AIG entered into an agreement to sell up to a 90 percent
    stake in ILFC to an investor group. The transaction, which is subject to
    required regulatory approvals, including all applicable U.S. and Chinese
    regulatory reviews and approvals, is expected to close in the second
    quarter of 2013. At closing, AIG will retain at least a 10 percent
    ownership stake in ILFC subject to dilution for management issuances
    (which, over time, would reduce AIG’s ownership by one percentage point).

  * Distributions from insurance operations totaled $1.4 billion in the fourth
    quarter of 2012, and $5.3 billion for the full year of 2012, in each case
    excluding a capital contribution to AIG Property Casualty of $1.0 billion
    following Storm Sandy.
  * AIG Parent liquidity sources amounted to $16.1 billion at December 31,
    2012, up from $11.6 billion at September 30, 2012, reflecting the sale of
    AIA shares.

                                                    
AFTER-TAX OPERATING
INCOME (LOSS)
                                                        
                         Three Months Ended            Full-Year Ended
                         December 31,                  December 31,
(in millions)              2012          2011          2012           2011    
Insurance Operations                                               
AIG Property Casualty    $ (945  )     $ 367         $ 1,820        $ 1,218
AIG Life and Retirement    1,090         912           4,160          3,277
Mortgage Guaranty          (45   )       (25   )       9              (97    )
(reported in Other)
Total Insurance            100           1,254         5,989          4,398   
Operations
Direct Investment book     509           (27   )       1,215          604
Global Capital Markets     300           46            557            (11    )
Change in fair value of
AIA (including realized    240           1,021         2,069          1,289
gains in 2012)
Change in fair value of    -             208           2,888          (646   )
ML III
Interest expense           (408  )       (364  )       (1,597 )       (1,685 )
Corporate expenses and     (356  )       (470  )       (1,039 )       (1,410 )
eliminations
Pre-tax operating income   385           1,668         10,082         2,539   
Income tax expense         (87   )       (77   )       (3,187 )       243
Noncontrolling interest    -             (96   )       (208   )       (634   )
– Treasury
Other noncontrolling       (8    )       (24   )       (52    )       (62    )
interest
After-tax operating
income attributable to   $ 290         $ 1,471       $ 6,635        $ 2,086   
AIG
                                                                              

AIG PROPERTY CASUALTY

AIG Property Casualty reported an operating loss of $945 million in the fourth
quarter of 2012, which included $2.0 billion of catastrophe losses from Storm
Sandy, compared to operating income of $367 million in the fourth quarter of
2011. Excluding catastrophe losses, AIG Property Casualty’s fourth quarter
2012 operating income was $1.0 billion, reflecting improved underwriting
margins and strong investment performance. AIG Property Casualty continued to
shift its mix of business to higher value products and regions, while
benefiting from positive rate trends.

The fourth quarter 2012 combined ratio was 125.1, compared to 107.1 in the
fourth quarter of 2011. Fourth quarter 2012 results included net prior year
adverse development of $116 million. The accident year loss ratio, as
adjusted, improved to 63.3 from 69.3 in the fourth quarter of 2011 driven by a
shift to higher value business and price increases. The fourth quarter 2012
acquisition ratio was 20.2, a 1.7 point increase over the fourth quarter of
2011 due to changes in business mix and a greater emphasis on direct
marketing. The fourth quarter 2012 general operating expense ratio was 17.3, a
3.2 point increase over the fourth quarter of 2011. Over half of the increase
in general operating expenses was related to investments in strategic
initiatives and higher severance and other personnel costs.

Fourth quarter 2012 net premiums written of $7.8 billion were essentially
unchanged compared to the fourth quarter of 2011. Commercial Insurance net
premiums written in original currencies were flat compared to the fourth
quarter of 2011. Growth in higher value products and geographies was offset by
risk selection initiatives and a new reinsurance program in U.S. excess
casualty. Consumer Insurance net premiums written in original currencies
increased 0.8 percent compared to the fourth quarter of 2011. Consumer
Insurance continued to focus on growth strategies in its major lines of
business, while expanding direct marketing as part of its multi-distribution
channel approach.

Commercial Insurance reported a fourth quarter 2012 operating loss of $857
million and a combined ratio of 130.4, compared to operating income of $448
million and a combined ratio of 107.1 in the fourth quarter of 2011. The
accident year loss ratio, as adjusted, improved to 66.4 from 76.9 in the
fourth quarter of 2011 due primarily to the shift to higher value business and
price increases. The fourth quarter 2012 acquisition ratio was 15.5, a 0.6
point increase over the fourth quarter of 2011. The fourth quarter 2012
general operating expense ratio was 14.0, a 2.1 point increase over the fourth
quarter of 2011.

Consumer Insurance reported a fourth quarter 2012 operating loss of $286
million and a combined ratio of 111.2, compared to operating income of $131
million and a combined ratio of 98.8 in the fourth quarter of 2011. The fourth
quarter 2012 accident year loss ratio, as adjusted, was 58.0, compared to 57.7
in the fourth quarter of 2011. The fourth quarter 2012 acquisition ratio was
26.9, a 3.0 point increase over the fourth quarter of 2011 due to changes in
Consumer Insurance’s business mix and increased investments in direct
marketing. The fourth quarter 2012 general operating expense ratio was 16.4, a
0.9 point increase over the fourth quarter of 2011.

AIG LIFE AND RETIREMENT

AIG Life and Retirement reported operating income of $1.1 billion in the
fourth quarter of 2012, compared to $912 million in the fourth quarter of 2011
as results were positively impacted by efforts to actively manage spread
income. Results benefited from higher net investment income, lower interest
credited, and lower reserve charges for death claims compared to the prior
year quarter. Partially offsetting these improvements were a favorable
litigation settlement of $226 million in 2011, less favorable equity market
performance in the fourth quarter of 2012 compared to the fourth quarter of
2011, loss recognition reserves of $61 million for a legacy block of long-term
care insurance issued prior to 2002, and less favorable mortality results
compared to the prior year.

Net investment income in the fourth quarter of 2012 was $2.7 billion, a $343
million increase from the fourth quarter of 2011, principally due to higher
returns on alternative investments and $57 million of fair value gains on the
investment in People's Insurance Company (Group) of China Limited (PICC). The
fourth quarter 2012 base investment yield was 5.33 percent, compared to 5.44
percent in the fourth quarter of 2011, reflecting lower yields on new
purchases due to declining interest rates along with opportunistic sales of
higher yielding securities and higher credit quality of new purchases. The
decline in base investment yield was more than offset by lower interest
crediting rates, which resulted in improved base net investment spreads for
group retirement products and fixed annuities, compared to the fourth quarter
of 2011. Total yield for the fourth quarter of 2012 was 6.09 percent compared
to 5.33 percent in the fourth quarter of 2011, reflecting higher alternative
investment returns and fair value gains on the PICC investment.

Premiums, deposits, and other considerations totaled $5.2 billion in the
fourth quarter of 2012, compared to $5.9 billion in the fourth quarter of
2011, principally due to a decline in fixed annuity deposits, as AIG Life and
Retirement continued to maintain pricing discipline in the current low
interest rate environment. Individual variable annuities showed significant
growth over the fourth quarter of 2011, benefiting from the expansion of the
sales organization, attractive product design, as well as a more favorable
competitive environment. Variable annuity deposits totaled $1.2 billion in the
fourth quarter of 2012, a 50 percent increase over the fourth quarter of 2011.
Premiums, deposits, and other considerations in the fourth quarter of 2012
increased by $430 million compared to the third quarter of 2012, principally
due to higher variable annuity and group retirement deposits.

Assets under management were $290.4 billion at the end of the fourth quarter
of 2012, compared to $256.9 billion at the end of the fourth quarter of 2011,
reflecting growth in variable annuities, strong fixed income and equity
markets, and the novation of stable value wrap business from Global Capital
Markets.

AIG Life and Retirement provided $440 million of distributions to AIG Parent
in the fourth quarter of 2012 and $2.9 billion for the full year 2012.

MORTGAGE GUARANTY

Mortgage Guaranty operations reported an operating loss of $45 million for the
fourth quarter of 2012 compared to an operating loss of $25 million in the
fourth quarter of 2011. Fourth quarter 2012 results reflected an increase in
first-lien loss reserves offset by favorable development in other lines.
Lengthening foreclosure timelines in certain states coupled with a reduction
in estimated future cures drove the increase in first-lien loss reserves.

Net premiums written were $236 million for the fourth quarter of 2012,
compared to $200 million for the fourth quarter of 2011. Domestic first-lien
new insurance written totaled $11.6 billion of principal amount of loans
insured for the quarter compared to $7.1 billion for the same period in 2011.
These results were driven primarily by increased mortgage originations and
higher private mortgage penetration in the fourth quarter of 2012 compared to
the comparable quarter of 2011 along with an expanded Mortgage Guaranty sales
force, new lenders, added distribution channels, and the exit of two
competitors in the second half of 2011. Borrower quality remained high, with
an average FICO score of 758 and an average loan-to-value of 91 percent on new
business.

OTHER OPERATIONS

AIG’s Other Operations reported fourth quarter 2012 operating income of $260
million, compared to $502 million in the fourth quarter of 2011.

Conference Call

AIG will host a conference call tomorrow, February 22, 2013, at 8:00 a.m. ET
to review these results. The call is open to the public and can be accessed
via a live listen-only webcast at www.aig.com. A replay will be available
after the call at the same location.

                                     ###

Additional supplementary financial data is available in the Investor
Information section at www.aig.com.

The conference call (including the conference call presentation material), the
earnings release and the financial supplement may include projections, goals,
assumptions and statements that may constitute “forward-looking statements”
within the meaning of the Private Securities Litigation Reform Act of 1995.
These projections, goals, assumptions and statements are not historical facts
but instead represent only our belief regarding future events, many of which,
by their nature, are inherently uncertain and outside our control. These
projections, goals, assumptions and statements include statements preceded by,
followed by or including words such as “believe,” “anticipate,” “expect,”
“intend,” “plan,” “view,” “target,” or “estimate.” These projections, goals,
assumptions and statements may address, among other things: the monetization
of our interests in ILFC, including whether our proposed sale of up to 90
percent of ILFC will be completed and if completed, the timing and final terms
of such sale; our exposures to subprime mortgages, monoline insurers, the
residential and commercial real estate markets, state and municipal bond
issuers and sovereign bond issuers; our exposure to European governments and
European financial institutions; our strategy for risk management; our
generation of deployable capital; our return on equity and earnings per share
long-term aspirational goals; our strategies to grow net investment income,
efficiently manage capital and reduce expenses; our strategies for customer
retention, growth, product development, market position, financial results and
reserves; and the revenues and combined ratios of our subsidiaries. It is
possible that our actual results and financial condition will differ, possibly
materially, from the results and financial condition indicated in these
projections, goals, assumptions and statements. Factors that could cause our
actual results to differ, possibly materially, from those in the specific
projections, goals, assumptions and statements include: changes in market
conditions; the occurrence of catastrophic events, both natural and man-made;
significant legal proceedings; the timing and applicable requirements of any
new regulatory framework to which we are subject as a savings and loan holding
company, and if such a determination is made, as a systemically important
financial institution; concentrations in our investment portfolios; actions by
credit rating agencies; judgments concerning casualty insurance underwriting
and insurance liabilities; judgments concerning the recognition of deferred
tax assets; judgments concerning deferred policy acquisition costs (DAC)
recoverability; and such other factors as are discussed in Part II, Item 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations (MD&A) and in Part I, Item IA. Risk Factors in AIG's Annual Report
on Form 10-K for the year ended December 31, 2012. We are not under any
obligation (and expressly disclaim any obligation) to update or alter any
projections, goals, assumptions, or other statements, whether written or oral,
that may be made from time to time, whether as a result of new information,
future events or otherwise.

                                     ###

Comment on Regulation G

Throughout this press release, including the financial highlights, we present
our operations in the way we believe will be most meaningful, representative,
and most transparent. That presentation includes the use of certain non-GAAP
financial measures. The reconciliations of such measures to the most
comparable GAAP measures in accordance with Regulation G are included within
the relevant tables.

We believe that After-tax operating income attributable to AIG permits a
better assessment and enhanced understanding of the operating performance of
our businesses by highlighting the results from ongoing operations and the
underlying profitability of our businesses. After-tax operating income
attributable to AIG is derived by excluding the following items from net
income (loss) attributable to AIG: (income) loss from discontinued operations,
net loss (gain) on sale of divested businesses, income from divested
businesses, legacy FIN 48 and other tax adjustments, legal reserves
(settlements) related to “legacy crisis matters,” deferred income tax
valuation allowance release, amortization of the Federal Reserve Bank of New
York (FRBNY) prepaid commitment fee asset, changes in fair value of AIG Life
and Retirement fixed income securities designated to hedge living benefit
liabilities, change in benefit reserves and deferred policy acquisition costs
(DAC), value of business acquired (VOBA), and sales inducement assets (SIA)
related to net realized capital (gains) losses, (gain) loss on extinguishment
of debt, net realized capital (gains) losses and non-qualifying derivative
hedging activities, excluding net realized capital (gains) losses. See page 10
for the reconciliation of Net income (loss) attributable to AIG to After-tax
operating income attributable to AIG. “Legacy crisis matters” include
favorable and unfavorable settlements related to events leading up to and
resulting from our September 2008 liquidity crisis. It also includes legal
fees incurred by AIG as the plaintiff in connection with such legal matters.

Although the investment of premiums to generate investment income (or loss)
and realized capital gains or losses is an integral part of both life and
general insurance operations, the determination to realize capital gains or
losses is independent of the insurance underwriting process. Moreover, under
applicable GAAP accounting requirements, losses can be recorded as the result
of other-than-temporary impairments in value without actual realization. In
sum, investment income and realized capital gains or losses for any particular
period are not indicative of underlying business performance for such period.

Life and retirement services premiums, deposits and other considerations is a
non-GAAP measure which includes life insurance premiums, deposits on annuity
contracts and mutual funds. We use this measure because it is a standard
measure of performance used in the insurance industry and thus allows for
meaningful comparisons with our insurance competitors.

We present the Accident year loss ratio, as adjusted, and Accident year
combined ratio, as adjusted, for our AIG Property Casualty operations. These
ratios exclude catastrophe losses and related reinstatement premiums, prior
year developments, net of premium adjustments and the impact of reserve
discount. Catastrophe losses are generally weather or seismic events having a
net impact on AIG Property Casualty in excess of $10 million each.

We believe Book Value Per Share, Excluding Accumulated Other Comprehensive
Income is a useful non-GAAP measure for investors because it eliminates the
effect of non-cash items that can fluctuate significantly from period to
period, including changes in fair value of our available for sale portfolio
and foreign translation adjustments.

Additionally, in some cases, revenues and rates of performance are shown
exclusive of partnership income, other enhancements to income and foreign
exchange rates. In all such instances, we believe that excluding these items
permits investors to better assess the operating performance of each of our
underlying businesses by highlighting the results from ongoing operations and
the underlying profitability of its businesses. We believe that providing
information in a non-GAAP manner is more useful to investors and analysts and
more meaningful than the GAAP presentation. When such measures are disclosed,
reconciliations to the comparable GAAP measure are provided.

                                     ###

American International Group, Inc. (AIG) is a leading international insurance
organization serving customers in more than 130 countries and jurisdictions.
AIG companies serve commercial, institutional, and individual customers
through one of the most extensive worldwide property-casualty networks of any
insurer. In addition, AIG companies are leading providers of life insurance
and retirement services in the United States. AIG common stock is listed on
the New York Stock Exchange and the Tokyo Stock Exchange.

Additional information about AIG can be found at www.aig.com | YouTube:
www.youtube.com/aig |Twitter: @AIG_LatestNews| LinkedIn:
http://www.linkedin.com/company/aig |

AIG is the marketing name for the worldwide property-casualty, life and
retirement, and general insurance operations of American International Group,
Inc. For additional information, please visit our website at www.aig.com. All
products and services are written or provided by subsidiaries or affiliates of
American International Group, Inc. Products or services may not be available
in all jurisdictions, and coverage is subject to actual policy language.
Non-insurance products and services may be provided by independent third
parties. Certain property-casualty coverages may be provided by a surplus
lines insurer. Surplus lines insurers do not generally participate in state
guaranty funds, and insureds are therefore not protected by such funds.

                                                                                               
American International Group, Inc.
Financial Highlights*
(in millions, except share data)
                                                                  
                     Three Months Ended December 31,             Twelve Months Ended December 31,
                                                  % Inc.                                        % Inc.
                     2012           2011          (Dec.)           2012           2011          (Dec.)
AIG Property
Casualty
Operations:
Net premiums       $ 7,809        $ 7,848         (0.5   ) %     $ 34,436       $ 34,840        (1.2   ) %
written
Net premiums         8,613          8,962         (3.9   )         34,873         35,689        (2.3   )
earned
Claims and
claims
adjustment           7,545          6,675         13.0             25,785         27,949        (7.7   )
expenses
incurred
Acquisition          1,737          1,657         4.8              6,936          6,464         7.3
expense
General
operating            1,493          1,266         17.9             5,152          4,406         16.9
expense
Underwriting         (2,162 )       (636    )     (239.9 )         (3,000 )       (3,130  )     4.2
loss
Net investment       1,217          1,003         21.3             4,820          4,348         10.9    
income
Operating            (945   )       367           -                1,820          1,218         49.4    
income (loss)
Net realized
capital gains        (51    )       454           -                (2     )       607           -
(losses) (a)
Legal                17             -             -                17             -             -
settlements
Other income         (4     )       (4      )     -                2              (5      )     -
(loss)
Pre-tax income     $ (983   )     $ 817           -              $ 1,837        $ 1,820         0.9
(loss)
                                                                                                 
Loss ratio           87.6           74.5                           73.9           78.3
Acquisition          20.2           18.5                           19.9           18.1
ratio
General
operating            17.3           14.1                           14.8           12.4     
expense ratio
Combined ratio       125.1          107.1                          108.6          108.8          
                                                                                                          
AIG Life and
Retirement
Operations:
Premiums           $ 626          $ 639           (2.0   )       $ 2,428        $ 2,513         (3.4   )
Policy fees          735            681           7.9              2,791          2,705         3.2
Net investment       2,715          2,372         14.5             10,718         9,882         8.5
income
Other income         9              209           (95.7  )         9              209           (95.7  )
Total revenues       4,085          3,901         4.7              15,946         15,309        4.2
Benefits and         2,995          2,989         0.2              11,786         12,032        (2.0   )
expenses
Operating            1,090          912           19.5             4,160          3,277         26.9    
income
Legal                154            -             -                154            -             -
settlements
Changes in
fair value of
fixed income
securities
designated to
hedge living
benefit
liabilities,
net of               (11    )       -             -                37             -             -
interest
expense
Change in
benefit
reserves and
DAC, VOBA and
SIA related
to net
realized             (81    )       (132    )     38.6             (1,201 )       (327    )     (267.3 )
capital gains
(losses)
Net realized
capital gains        100            97            3.1              630            6             -
(a)
Pre-tax income     $ 1,252        $ 877           42.8           $ 3,780        $ 2,956         27.9    
Other
operations,          260            502           (48.2  )         4,124          (1,774  )     -       
operating
income (loss)
Other
operations,
pre-tax income
(loss) before        290            979           (70.4  )         3,398          (4,715  )     -
net realized
capital gains
(losses)
Other
operations,
net realized         98             173           (43.4  )         501            12            -
capital gains
(a)
Consolidation
and
elimination          (28    )       (75     )     62.7             (194   )       43            -
adjustments
(a)
Income from
continuing
operations
before income
tax
expense              629            2,771         (77.3  )         9,322          116           -
(benefit)
Income tax
expense              246            (18,737 )     -                1,570          (19,424 )     -
(benefit)
Income from
continuing           383            21,508        (98.2  )         7,752          19,540        (60.3  )
operations
Income (loss)
from
discontinued         (4,332 )       94            -                (4,052 )       1,790         -
operations,
net of tax
Net income           (3,949 )       21,602        -                3,700          21,330        (82.7  )
(loss)
Less:
Net income
from
continuing
operations
attributable
to
noncontrolling
interests:
Noncontrolling
nonvoting,
callable,
junior and
senior
preferred
interests            -              96            -                208            634           (67.2  )
Other                9              26            (65.4  )         54             54            -
Total net
income from
continuing
operations
attributable
to
noncontrolling       9              122           (92.6  )         262            688           (61.9  )
interests
Net income
from
discontinued
operations
attributable
to
noncontrolling       -              1             -                -              20            -
interests
Total net
income
attributable         9              123           (92.7  )         262            708           (63.0  )
to
noncontrolling
interests
Net income
(loss)               (3,958 )       21,479        -                3,438          20,622        (83.3  )
attributable
to AIG
Net income
(loss)
attributable       $ (3,958 )     $ 21,479        -        %     $ 3,438        $ 19,810        -        %
to AIG common
shareholders
                                                                                                          

                                                                                              
Financial
Highlights
-continued
             
                   Three Months Ended December 31,              Twelve Months Ended December 31,
                                                  % Inc.                                       % Inc.
                     2012           2011          (Dec.)          2012           2011          (Dec.)
                                                                                                        
Net income
(loss)             $ (3,958 )     $ 21,479        -       %     $ 3,438        $ 20,622        (83.3 ) %
attributable
to AIG
Adjustments to
arrive at
after-tax
operating
income
attributable
to AIG
(amounts net
of tax):
(Income) loss
from                 4,332          (93     )     -               4,052          (1,770  )     -
discontinued
operations
Net loss
(gain) on sale       (1     )       (1      )     -               1              48            (97.9 )
of divested
businesses
Income from
divested             -              -             -               -              (16     )     -
businesses
Legacy FIN 48
and other tax        200            -             -               543            -             -
adjustments
Legal reserves
(settlements)
related to           (129   )       6             -               353            13            -
legacy crisis
matters
Deferred
income tax
valuation            (116   )       (19,252 )     99.4            (1,911 )       (18,307 )     (89.6 )
allowance
release
Amortization
of FRBNY
prepaid              -              -             -               -              2,358         -
commitment fee
asset
Changes in
fair value of
AIG Life and
Retirement
fixed income
securities
designated to
hedge living         7              -             -               (24    )       -             -
benefit
liabilities
Change in
benefit
reserves and                                                                                    
DAC, VOBA and
SIA related
to net
realized             52             83            (37.3 )         781            202           286.6
capital
(gains) losses
(Gain) loss on
extinguishment       -              (328    )     -               6              (520    )     -
of debt
Net realized
capital              (97    )       (414    )     76.6            (586   )       (460    )     (27.4 )
(gains) losses
Non-qualifying
derivative
hedging
activities,
excluding net
realized
capital              -              (9      )     -               (18    )       (84     )     78.6
(gains) losses
After-tax
operating
income             $ 290          $ 1,471         (80.3 )       $ 6,635        $ 2,086         218.1
attributable
to AIG
                                                                                                        
Income (loss)
per common
share -
diluted:
Net income
(loss)
attributable       $ (2.68  )     $ 11.31         -             $ 2.04         $ 11.01         (81.5 )
to AIG common
shareholders
After-tax
operating
income             $ 0.20         $ 0.77          (74.0 )       $ 3.93         $ 1.16          239.0
attributable
to AIG
                                                                                                        
Book value per                                                  $ 66.38        $ 53.53         24.0    %
share (b)
Book value per
share,
excluding
accumulated                                                     $ 57.87        $ 50.11         15.5    %
other
comprehensive
income (c)
                                                                                                        
Return on            NM             NM                            3.4    %       24.1    %
equity (d)
Return on
equity,
excluding
accumulated          NM             NM                            3.7    %       26.6    %
other
comprehensive
income (e)
Return on
equity -
after-tax            1.3    %       7.0     %                     7.2    %       2.7     %
operating
income (f)
 

 
Financial highlights - notes
     
*     Including reconciliation in accordance with Regulation G.
      Includes gains (losses) from hedging activities that did not qualify for
(a)   hedge accounting treatment, including the related foreign exchange gains
      and losses.
(b)   Represents total AIG shareholders' equity divided by shares outstanding.
      Represents total AIG shareholders’ equity, excluding accumulated other
      comprehensive income (AOCI) divided by shares outstanding. Amounts for
(c)   periods prior to December 31, 2012 have been revised to reflect
      reclassification of income taxes from AOCI to additional paid in capital
      to correct the presentation of components of AIG shareholders’ equity.
      Computed as Actual or Annualized net income (loss) attributable to AIG
(d)   divided by average AIG shareholders' equity. Equity includes deferred
      tax assets.
      Computed as Actual or Annualized net income (loss) attributable to AIG
(e)   divided by average AIG shareholders' equity, excluding AOCI. Equity
      includes deferred tax assets.
      Computed as Actual or Annualized after-tax operating income divided by
(f)   average AIG shareholders' equity, excluding AOCI. Equity includes
      deferred tax assets.
NM - Not meaningful

Contact:

American International Group, Inc.
Investors:
Liz Werner, 212-770-7074
elizabeth.werner@aig.com
or
Media:
Jon Diat, 212-770-3505
jon.diat@aig.com
Jim Ankner, 212-770-3277
james.ankner@aig.com
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