AIG, which got one of the biggest bailouts of all time, says it will be able to pay back some $51 billion after it sells two subsidiaries.
That's not nearly enough to pay off what the company owes.
The size of the bailout is often put at around $180 billion, but it's more complicated — and more fluid — than that single number suggests. Here are some key figures based on the most recent public information:
|New York Fed preferred equity in two AIG subsidiaries:||$25 billion|
|NY Fed gave AIG a $35 billion line of credit. Amount AIG owes:||$25 billion|
|NY Fed loaned money to two entities created to buy ugly assets from AIG. Principal those entities owe the Fed:||$33 billion|
|Treasury agreed to loan AIG $70 billion. Amount AIG has borrowed:||$45 billion|
Those first two rows up there — the line of credit and preferred equity from the NY Fed — are what AIG plans to pay back with the money it gets from selling the subsidiaries. AIG will be paid a little over $30 billion in cash for the sales, so that money should flow through to the Fed as soon as the deals go through. The rest of the payment will be in the form of stock, which AIG plans to sell over time.
AIG doesn't have to pay back the money in the third row — the loans to entities created to buy AIG assets. The entities are currently collecting payments from the underlying assets (packages of mortgages and the like) and are slowly paying back the loan to the Fed. The entities may ultimately wind up selling off the assets. Whatever happens, AIG isn't on the hook for that money.
That last row — the loans from Treasury — that's taxpayer money that AIG is supposed to pay back some day. It's unclear whether that will ever happen; the CBO, Congress's nonpartisan scorekeeper, recently estimated that Treasury would lose $9 billion on its contribution to the AIG bailout.
A few notes on the figures in the table above: The New York Fed numbers are as of March 3, and are from a weekly Fed report. The Treasury numbers are as of Jan. 31 and are from a monthly Treasury report.