9/11. You do have unexpected things happen in the property/casualty business and I did not want to be writing a letter to the shareholders, but for this, this, this, we would have had a good year.
So we then built our life business step-by-step globally. When I left the company our life operation was the largest in the world between domestic and foreign and our life business was quite good. The foreign side was excellent, always had been. Yes, a couple of small territories might have a marginal year but we were also conservative in how we invested the assets. You’re a trustee for other people’s money in a life insurance company. You can’t ever forget that. You don’t speculate with that, which is what they did in the security lending program. Essentially speculating to get a higher return and forgetting about the matching of assets and liabilities. That was essential.
So that gave us more diversification; again, more stability. We were triple-A rated when I was there before I left the company. A triple-A rating is an asset and you want to maximize the benefit of that. That’s why we created AIGFP [American International Group Financial Products]. But it was under control. AIGFP earned a lot of money for us when I was there. It wasn’t intended to go off and do things in the way they did it without hedging. If they were going to do it, they should have been hedging. It’s like me writing all the earthquake insurance in California and not having reinsurance. It’s that kind of mentality that seemed to overtake the company. I don’t know who the hell was doing it but they were.
So diversification was always one of the strategies of AIG and did give us the breadth. For example, consumer finance when we had a big operation, say in Hong Kong and Southeast Asia, we were able to use Consumer Finance to feed off our life insurance business and we did. So that gave us a breadth that no company could compete with. We were really in a category all our own. There was nobody close to us. What’s troubling is to see how rapidly a great company could come to its knees. It doesn’t take long.
ASIA
DANKWA: Speaking of the assets in Asia, the ones that they’ve put up for sale, I’m wondering what your take is on what potential buyers are in Asia for some of these assets. Do you think that the local domestic players out there might be interested in acquiring those companies?
GREENBERG: I saw that none of the Japanese life companies want to buy any part of the domestic AIG Alico business in Japan. We had three life companies in Japan.
DANKWA: They were going to merge two of them, right?
GREENBERG: Those were going to be merged anyway. But they’re not interested. They don’t have to be because they’re going to get that business sooner or later.
DANKWA: What do you mean?
GREENBERG: Because people are leaving AIG and a lot of that business is going to be taken over by competitors.
DANKWA: So you think it’s going to be more difficult to sell those entities than perhaps the ones Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7