AIG: Financial Winners and Losers

(Updated with stock price moves.)

NEW YORK (TheStreet) -- American International Group (AIG) was among the top performers of the financial sector Tuesday after UBS resumed coverage of the insurer.

AIG shares were climbing 6.5% after UBS said it resumed coverage of the stock with a neutral rating, arguing that the U.S. government's role in the insurer could mean either a sharp climb or steep decline in shares.

If the government reduces its ownership and eases the terms of its repayment agreement, shares could soar, UBS said in the research note; but if the agreement stays the same, UBS argues, the stock is headed for another drop. AIG was lately up $2.05, or 4.8%,to $44.80.

In addition to AIG, UBS resumed coverage of several other insurers. The firm assigned a neutral rating to Aflac (AFL), Conseco (CNO), Lincoln National (LNC), Manulife Financial (MFC), National Financial Partners (NFP) and Protective Life (PL).

UBS offered a buy rating for Ameriprise Financial (AMP), Genworth Financial (GENW), MetLife (MET), Phoenix Companies (PNX), Hartford Financial (HIG) and Reinsurance Group of America (RGA). The firm resumed coverage of Principal Financial (PFG) with a sell rating.

Among bank stocks, Citigroup (C) was rising after the bank said it's outsourcing some investment services offered to U.S. branch customers to outside advisers. The move is part of Citi's effort to shift its investment advisory business to a fee model derived from a percentage of assets, rather than relying upon commission-based transactions. Citi is shifting up to 550 employees to new roles as part of the move, and the company said it's already in talks with a number of independent registered investment advisory firms about partnerships.

Citigroup shares were higher by two cents, or 0.4%, to $4.69.