AIG 2013 Annual Report Download - page 147

Liquidity and Capital Resources Highlights 2013
Sources
•AIG Parent Funding from Subsidiaries
We collected $8.7 billion in cash dividends and loan repayments from our insurance subsidiaries — $4.1 billion
in cash dividends from AIG Property Casualty, $4.4 billion in cash dividends and loan repayments from AIG
Life and Retirement and $90 million in cash dividends from Mortgage Guaranty. Infrequent events at our
insurance subsidiaries including capital management initiatives at AIG Property Casualty and proceeds from
legal settlements at AIG Life and Retirement resulted in higher than usual dividends.
•Legal Settlements
On August 26, 2013, we agreed to the termination of an interest rate swap agreement with Brookfield Asset
Management, Inc. and Brysons International, Ltd, in exchange for a payment to AIGFP of $905 million.
We received $1.0 billion from settlements with financial institutions that participated in the creation, offering and
sale of RMBS from which we realized losses during the financial crisis.
•Debt Issuances
On August 9, 2013, we issued $1.0 billion aggregate principal amount of 3.375% senior notes due 2020. On
October 2, 2013, we issued $1.0 billion aggregate principal amount of 4.125% senior notes due 2024.
•ALICO Escrow Release
On May 1, 2013, $547 million held in escrow to secure indemnifications provided to MetLife, Inc. (MetLife)
under the ALICO stock purchase agreement was released to AIG.
Uses
•Debt Reduction*
We repaid approximately $9.7 billion of debt as follows.
We redeemed:
• $1.1 billion aggregate principal amount of our 7.70% Series A-5 Junior Subordinated Debentures and
$750 million aggregate principal amount of our 6.45% Series A-4 Junior Subordinated Debentures, in each
case for a redemption price of 100 percent of the principal amount, plus accrued and unpaid interest; and
• $500 million aggregate principal amount of our 3.650% senior notes due 2014 for a redemption price of
101.1 percent of the principal amount, plus accrued and unpaid interest.
We purchased, in cash tender offers:
• for an aggregate purchase price of approximately $1 billion, approximately 77 million British pounds
aggregate principal amount of our 8.625% Series A-8 Junior Subordinated Debentures, approximately
182 million Euro aggregate principal amount of our 8.000% Series A-7 Junior Subordinated Debentures,
approximately $79 million aggregate principal amount of our 6.25% Series A-1 Junior Subordinated
Debentures and approximately $366 million aggregate principal amount of our 8.175% Series A-6 Junior
Subordinated Debentures;
• for an aggregate purchase price of approximately $211 million, approximately $19 million liquidation amount
of 81⁄2% Capital Trust Pass-Through Securities, approximately $114 million liquidation amount of 7.57%
Capital Securities, Series A and approximately $29 million liquidation amount of 81⁄8% Capital Securities,
Series B, all of which were issued by statutory trusts controlled by AIG Life Holdings, Inc; and
• for an aggregate purchase price of approximately $61 million, approximately $62 million aggregate principal
amount of 5.60% Senior Debentures we had assumed that were originally issued by SunAmerica Inc.
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AIG 2013 Form 10-K 129
ITEM 7 / LIQUIDITY AND CAPITAL RESOURCES
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