AIG: Financial Winners & Losers

NEW YORK ( TheStreet) -- American International Group ( AIG) was among few winners of the financial sector Monday after a report that the insurer will retain $21 million in bonus payments.

AIG will hold back the bonus payments from current and former employees of its financial products unit, according to a CNBC report. AIG is slated to pay out $46 million in bonuses Monday to about 70 people, most of whom are former employees.
AIG

The retained bonuses are expected to help AIG exceed a $45 million giveback target demanded by pay czar Kenneth Feinberg, a source told Reuters. So far, AIG employees, mostly current and some former, have agreed to return $40 million, in part by accepting lower 2010 payouts.

AIG shares were lately up 58 cents, or 1.7%, to $34.81. Other insurance stocks were trading mixed, with Prudential PLC ( PUK) down 3.5% to $16.25, Hartford Financial ( HIG) down 0.7% to $26.57, and MetLife ( MET) up 0.1% to $42.16.

Several other U.S. financial stocks were trading lower as Senate Banking Committee Chairman Christopher Dodd (D., Conn.) was preparing to unveil his draft bill for financial reform, which will reportedly focus on the consolidation banking regulators and the creation of consumer watchdog agency within the Federal Reserve.

Senator Bob Corker (R., Tenn.), who had worked with Dodd on a bipartisan solution to financial reform before talks fell apart, told CNBC that he expects Dodd will "introduce a bill that will be to the left of where we were -- close, but left." Corker called the new draft a "much better bill," but added that it "will be a bill I cannot support."

Among U.S. bank stocks trading lower, Citigroup ( C) fell 2% to $3.88, Morgan Stanley ( MS) was down 0.5% to $29.77, and Goldman Sachs ( GS) dipped 0.2% to $174.64.

On the upside, Bank of America ( BAC) tacked on 0.2% to $16.88, and JPMorgan Chase ( JPM) was up 0.1% to $43.19.

Credit-card issuers were also trading mixed as companies prepared to report card metrics for February. Already, Capital One Financial ( COF) said its annualized net charge-off rate for U.S. credit cards fell to 10.19% last month from 10.41% in January.

Capital One said delinquent accounts, which are late by 30 days or more and are an indicator of future losses, fell to 5.51% in February from 5.80% in January. Still, Capital One shares were down 0.6% to $39.64.

Discover Financial ( DFS), meanwhile, gained 0.5% to $15.05 after The Wall Street Journal said the credit-card company will implement a new accounting rule requiring companies to bring their off-the-books securitized loans onto their balance sheet in fiscal 2010.

Discover, which will release its own monthly card metrics later, will bring on its books $21 billion of assets and increase reserves by $2.1 billion as a result of the rule change, according to the paper. Discover will report quarterly results after the close of trading Tuesday.

Monthly credit card delinquency data from American Express ( AXP) as well as delinquency data on securitized loans from the large credit card issuing banks Bank of America, JPMorgan and Citigroup will likely be filed later Monday.

PNC Financial ( PNC) fell 1.9% to $56.75 after Rochdale Securities analyst Dick Bove cut his rating on the stock to neutral from buy, arguing that the company is facing a difficult year in 2010.

"While management is very positive on its longer term outlook, the challenges this company faces short-term are significant," Bove wrote in a research note."While PNC's loan loss experience is better than that of its peers, there is no indication that loan losses will decline in the first half of 2010. The probability is that they will rise."

-- Written by Robert Holmes in Boston.

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