AIG bailout: gets $85 billion from the U.S. government

American International Group Inc accepted a loan of $85 billion from the federal government which now gives the US government the majority stake in the giant insurer.

After private efforts failed by AIG, the U.S. federal government reversed its opposition to a bailout of AIG, the Federal Reserve concluded that “a disorderly failure of AIG could add to already significant levels of financial market fragility,” reported in a statement by the Federal government yesterday.

Financial markets across the world were waiting for the results of the AIG crisis, as nobody really had a clue as to how bad it could be, and what it would have meant if the insurer was allowed to fail, it’s a huge relief for many people.

The government have taken a 79.9 percent stake in AIG and senior managers including Robert Willumstad the CEO will leave their jobs it’s been leaked by a source close to the situation that the position will be taken over by Edward Liddy.

Read the full article at Bloomberg