NEW YORK ( TheStreet) -- American International Group ( AIG) and the Treasury Department got a little pat on the back from a government watchdog on Thursday. The Government Accountabilty Office issued a report on the status of the insurance giant's bailout and commented on the improvement on both the business side and the balance sheet since its last check-up in April. "Overall, federal assistance appears to be facilitating a more orderly restructuring of the company," the report reads, adding that AIG's financial condition "has generally remained relatively stable or showed signs of improvement" since the last report.
The office also finds that more of AIG's fate now rests in management's hands, implying the company is less vulnerable to macro risks than it has been in the past. This view is tied up in the fact that after last week's recapitalization, the Treasury owns roughly 92% of AIG's common stock, meaning appreciation of those shares from here will be key to getting back taxpayers' money. "Consequently, the government's and thus taxpayer's exposure to AIG is increasingly expected to be tied to the success of AIG, its ongoing performance, and its value as seen by investors of AIG's common stock," the report states. AIG shares closed Thursday at $43.18 amid some confusion among investors about the warrant distribution the company affected as part of its recapitalization. -- Written by Michael Baron in New York. >To contact the writer of this article, click here: Michael Baron. >To submit a news tip, send an email to: email@example.com