The Federal Reserve Bank of New York has agreed to issue AIG a two year, $85 Billion secured revolving credit facility in return for a 79.9 percent equity interest in AIG and the right to veto the payment of dividends to common and preferred shareholders.
United States
EAPD Issues Advisory Regarding Insolvency Proceedings in the US, UK and Japan
Lehman Brothers Holdings Inc., the holding company for the fourth-largest United States investment bank, filed for protection under Chapter 11 of the United States Bankruptcy Code on September 15, 2008, marking the largest US bankruptcy filing in history. Following the filing in the Southern District of New York, the directors of Lehman Brothers International (Europe) and three of its UK subsidiaries applied for administration (a process similar to Chapter 11) in the UK.
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AIG Issues Statement to Address Policyholder Concerns
Earlier today, AIG issued this press release in response to policyholder concerns about the company.
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The New York Mets’ Insurance Concern
By Troutman Pepper Locke on
As the New York Mets’ players are focused on reaching the post-season, team management has other concerns – insurance. Billy Wagner, the team’s closer, underwent ulnar collateral ligament reconstruction (commonly known as Tommy John surgery) last week and is likely to miss the entire 2009 season. …
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Florida District Court Disallows Production of Documents Regarding Agent’s “Loss Ratio Bonuses” But Holds That Plaintiff May Nevertheless Depose Agent for Impeachment Purposes
By Troutman Pepper Locke on
In Buckley Towers Condominium, Inc. v. QBE Ins. Co., No. 07-22988-CIV, 2008 WL 2645680 (S.D. Fla., Jun. 26, 2008), a Florida federal court found that financial or contractual documents between an insurer and its adjusting agent are not discoverable in a coverage action, but the agent may be deposed as to his knowledge of financial incentives, and such testimony may be admissible for impeachment purposes. …
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Fidelity Reaches Auction Rate Securities Settlement With New York Attorney General
By Troutman Pepper Locke on
The New York Attorney General recently announced that it had reached a settlement with Fidelity Investments regarding Fidelity’s involvement with auction rate securities (“ARS”). The settlement, which calls for Fidelity to return $300 million to its customers by the end of the year, is the first settlement reached with a downstream retail broker.
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Bank of America Reaches Auction Rate Securities Settlement with Massachusetts Securities Division
By Troutman Pepper Locke on
Bank of America recently announced that it has reached a settlement with the Massachusetts Securities Division concerning its involvement in the Auction Rate Securities (“ARS”) market. (Click here for Bank of America’s press release.) …
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BREAKING NEWS: AIG Receives Special Permission to Access $20 Billion of Subsidiaries’ Capital
In the wake of American International Group, Inc.’s (“AIG”) request for a $40 billion bridge loan from the Federal Reserve, New York Governor David Patterson has announced that AIG has been granted “special permission to access $20 billion of capital in its subsidiaries to free up liquidity.” This will enable, in essence, AIG to make a bridge loan to itself.
Insurers Cannot Assume They Are Safe From FCPA
By Troutman Pepper Locke on
Corruption of public officials has not been viewed as a significant problem for the insurance industry. That may change. Fighting corruption is high on the international agenda.
Florida Insurance Commissioner Orders State Farm to Refund $120 Million for Unpaid Windstorm Mitigation Discounts
By Troutman Pepper Locke on
On September 9, 2008, Florida Insurance Commissioner Kevin McCarty ordered State Farm Florida to issue $120 million in credits or refunds to approximately 98,000 current or former policyholders who did not receive, or who did not apply for, Windstorm Loss Reduction Rating Plan discounts that were available to Windstorm policy holders who made their homes more windstorm resistant.