AIG 2014 Annual Report Download - page 122

ITEM 7 / RESULTS OF OPERATIONS / CORPORATE AND OTHER
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105
Other Businesses
2014 and 2013 Comparison
Other businesses’ pre-tax operating income improved in 2014 compared to 2013 due to an increase in gains on investments in
life settlements resulting from higher net death benefits.
2013 and 2012 Comparison
Other businesses’ pre-tax operating loss in 2013 was essentially flat compared to 2012.
AIG Parent and Other Results
2014 and 2013 Comparison
AIG Parent and Other’s pre-tax operating losses decreased in 2014 compared to 2013 primarily due to our share of AerCap’s
pre-tax operating income, which is accounted for under the equity method, and lower interest expense from ongoing debt
management activities described in Liquidity and Capital Resources, partially offset by an increase in general operating
expenses.
General operating expenses increased in 2014 compared to 2013 as a result of centralizing processes to lower-cost locations
and increased costs related to investments in technology.
2013 and 2012 Comparison
AIG Parent and Other reported an increase in pre-tax operating losses in 2013 compared to 2012 primarily due to severance
charges and higher general operating expenses. These increases were partially offset by lower interest expense due to
various debt management activities described in Liquidity and Capital Resources.
General operating expenses increased in 2013 compared to 2012 due to higher incentive compensation costs. In addition,
2012 included reductions in expenses of $211 million resulting from the decrease in the estimate of the liability for the
Department of the Treasury’s underwriting fees in connection with sales of AIG Common Stock.
Retained Interests
Change in Fair Value of AIA Securities Prior to Their Sale
We sold our remaining 33 percent interest in AIA ordinary shares for proceeds of $14.5 billion and a net gain of $2.1 billion
through three sale transactions on March 7, September 11, and December 20, 2012.
Change in Fair Value of ML III Prior to Liquidation
The gains attributable to AIG’s interest in ML III for 2012 were based in part on the completion of the final auction of ML III
assets by the FRBNY, in the third quarter of 2012.