Update adds change in the board of directors.Oddly enough American International Group ( AIG - Get Report) actually said something promising during its annual meeting on Tuesday. Executives of the insurance giant said there is an "excellent chance" it will be able to repay the government's massive loan and that AIG is actually "more stable than before." Meanwhile, investors are awaiting a reverse stock split that is expected to come into affect later today. This would mean if you own 1,000 shares you now own 50. AIG will initially multiply the share value by a like amount, so investors will retain their equity, but it's unlikely they can grow their investment. Tuesday was the first time shareholders were able to gather since the AIG mess surfaced last year. And while the meeting was relatively subdued, shareholders voted in a new reign of government-backed directors, with about seven of the new directors recommended by either the U.S. Treasury Department or the trustees. Only fair, seeing as the government now owns 80% of the flailing insurer. AIG has been under public scrutiny after losing $99 billion last year, mostly from its exposure to credit default swaps. The company expects to incur more losses from swaps this year. It has also been berated for bonuses awarded in its financial products unit, the source of much of its losses. But government-placed CEO Edward Liddy said the financial products unit has nearly halved its derivatives exposure, to $1.4 trillion from $2.7 trillion, and by year-end "our risk will have been reduced substantially from its current status." Liddy plans to step down, but a timeframe on his replacement was not revealed. AIG had delayed its annual meeting, usually held in May, to give it more time to shuffle its board, which has been almost entirely reconfigured over the last year.
TheStreet’s Fundamentals of Investing Course will teach you the keys to making the right decisions in any market.
TheStreet’s Personal Finance Essentials Course will teach you money management basics and investing strategies to help you avoid major financial pitfalls.
TheStreet Courses offers dedicated classes designed to improve your investing skills, stock market knowledge and money management capabilities.
More from Opinion
Tesla's Stock Is Finally Pricing in a Lot of its Business Risks
Following their recent tumble, the risks and potential rewards presented by Tesla's stock might finally be in balance, or at least close to it.
Pinterest's Earnings Report Doesn't Justify Pressing the Panic Button
The social media platform's guidance isn't that bad in light of its spending and growth strategy, and some of its first-quarter numbers were pretty solid.
Cisco: Despite Another Strong Quarter, Stock Could Stall
High valuations and earnings growth supported primarily by share repurchases suggest that Cisco's stock may take a break from its recent run-up.
Disney's Earnings: A Five-Year Growth Story Is Unfolding
Should Disney execute well on its transition plan over the next few years, an investment in the stock at current levels will likely be properly justified, proving the forward earnings multiple of 20x to be overly conservative.