AIG takes $5.4 billion 2nd quarter loss

The worst over?  Not so much.  AIG took a whopping $5.4 billion dollar loss last quarter related to, you guessed it, mortgage losses and write downs!  I’m one big broken record these days, but there’s not much else to say here.

AIG quickly took a nice chunk out of its recently-raised $20 billion as writedowns on mortgage hammered its business.

From Market Watch:

American International Group reported a $5.36 billion second-quarter net loss late Wednesday as the insurance giant was hit again by write-downs and impairments on mortgage-related exposures.

The quarterly net loss included $5.57 billion of unrealized market valuation losses on AIG’s super senior credit default swap portfolio. It also included $6.08 billion of net realized capital losses from its investment portfolio, the company disclosed.

“Our second quarter results were adversely affected by the severe conditions in the housing and credit markets and a very difficult investment environment,” AIG’s new Chief Executive Robert Willumstad said in a statement. “We have a lot of work to do to restore AIG’s profitability to where it should be.”

AIG reported a record quarterly loss earlier this year after suffering huge write-downs on credit exposures. The company quickly raised roughly $20 billion selling new shares and other securities.

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