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AIG’s $2 Billion of Bonds Rise in First Trading Day, Trace Data

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Dec. 1 (Bloomberg) -- Bonds issued by American International Group Inc. rose in secondary trading, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

The insurer sold debt yesterday for the first time since its 2008 rescue by the U.S. government. The New York-based company’s $500 million of 3.65 percent notes due January 2014 rose 0.83 cent to 100.8 cents on the dollar, as of 8:39 a.m. in New York, Trace data show. The bonds yield 179 basis points points more than similar-maturity Treasuries after issuing at a 295 basis-point spread.

AIG’s $1.5 billion of 6.4 percent debt due December 2020 rose 0.33 cent to 100.07 cents on the dollar, a spread of 349 basis points, Trace data show. Those notes were issued with a relative yield of 362.5 basis points, Bloomberg data show.

“It was a good deal because it was relatively cheap,” said Michael Donelan, who oversees $3.5 billion of bonds as director of trading and head portfolio manager at Ryan Labs Inc. in New York. “They priced it at concession, but not as much as what we would have hoped.”

Link to Company News:{AIG US <Equity> CN <GO>}

To contact the reporter on this story: John Detrixhe in New York at jdetrixhe1@bloomberg.net

To contact the editor responsible for this story: Pierre Paulden at ppaulden@bloomberg.net

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