AIG Posts 2nd Consecutive Quarterly Profit

STEPHEN BERNARD

NEW YORK (AP) — AIG said Friday it was profitable for the second straight quarter as its core insurance operations continue to stabilize after the company's bailout by the government last year.

American International Group Inc. also said the amount of its government financial assistance dropped by 4 percent during the third quarter. Its results got a lift from the increasing value of investments it still holds that soured last year and helped drive it to the brink of collapse.

While new insurance business stabilized compared with the second quarter, it is still sharply below year-ago figures as the economy remains weak and AIG struggles with its image after being bailed out by the government. A recovery in its core insurance operations is considered vital to AIG repaying the government.

CEO Robert Benmosche warned that earnings will remain choppy as the company executes its restructuring plan.

"We continue to focus on stabilizing and strengthening our businesses, but expect continued volatility in reported results in the coming quarters, due in part to charges related to ongoing restructuring activities," Benmosche said in a statement.