Fears over Manchester United sponsor AIG

Updated 15.07 Mon Sep 15 2008
Keywords: cash, finance, credit, Lehman Brothers, insurer, insurance, AIG

There are fears over the future of US insurance company AIG following the collapse of Wall Street banking giant Lehman Brothers.

According to reports, executives of American International Group met top New York state officials and banking regulators over the weekend seeking permission to liquidate assets to raise cash.

The insurer - who sponsors Manchester United football club in the UK - has incurred £10 billion in losses over the past three quarters from guarantees it wrote on mortgage derivatives

On Sunday, AIG - until recently the world's biggest insurer by market capitalisation and the sponsor of Manchester United football club in the UK - is reported to have approached the US Federal Reserve seeking over £22 billion in short-term financing.

AIG is the Premier League champions' main sponsor, having signed a four-year £56.5 million agreement in 2006 - the biggest shirt sponsorship deal in English football.

Man United has said it is "in close contact" with AIG, but declined to comment.

The insurer has incurred £10 billion in losses over the past three quarters from guarantees it wrote on mortgage derivatives.

On Friday it was hit by credit ratings firm Standard & Poor's who ranked it as a negative watch, indicating a possible downgrade.

AIG shares have fallen 80 per cent since the start of the year and on Monday they plummeted a further 52 per cent to £3.25 on the New York Stock Exchange before recouping slightly to £4.13.

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