American International Group Inc. (AIG) has filed its Quarterly Report on Form 10-Q for the period ending June 30, 2005 with the Securities and Exchange Commission. Additionally, AIG filed a Form 10-Q/A restating the second quarter and the first six months of 2004 and 2003.
Second quarter 2005 net income was $3.99 billion or $1.53 per diluted share, compared to $2.65 billion or $1.01 per diluted share in the second quarter of 2004. At June 30, 2005, shareholders’ equity was $88.88 billion and consolidated assets were $828.64 billion.
Net income for the first six months of 2005 was $7.68 billion or $2.93 per diluted share, compared to $5.21 billion or $1.98 per diluted share in the first six months of 2004.
Commenting on second quarter earnings, AIG President and Chief Executive Officer Martin Sullivan said, “In a quarter where the company devoted significant time and attention to its internal review, our operations stayed focused on their customers and business, achieving good results. Market conditions and other trends evident in the first quarter largely continued through the second quarter. Worldwide General Insurance, Foreign Life Insurance & Retirement Services and Consumer Finance were among our best performing businesses. A flat yield curve affected our spread businesses, and transaction volume in Domestic Life Insurance & Retirement Services and Capital Markets was lower as a result of regulatory and related issues. Our second quarter results were also adversely affected by the recording of a charge for the cumulative effect of the correction of an error relating to certain manufacturers’ payments made for the benefit of ILFC. These factors were offset, however, by solid underwriting results and strong investment returns throughout our businesses.
“General Insurance operating income before realized capital gains (losses) increased 20.5 percent compared to the second quarter of 2004. The combined ratio was 92.04. Premium growth of 4.2 percent reflects the underwriting discipline that we are maintaining in an environment that has been characterized by softer pricing in the domestic and international markets. Terms and conditions continue to be largely unchanged. The Domestic Brokerage Group had a combined ratio of 96.05, and the Foreign General combined ratio was an excellent 82.04. Domestic Personal Lines had premium growth of 7.5 percent and a combined ratio of 95.92. Mortgage Guaranty had premium growth of 6.6 percent and a delinquency ratio that continues to run well below the industry average. General Insurance cash flow was $2.71 billion and $6.21 billion in the second quarter and first six months of 2005, respectively. Pretax third quarter 2005 losses arising from hurricanes Emily and Dennis are estimated to be $40 million.
“In conclusion, AIG performed well and demonstrated great resilience in the second quarter of 2005. Our strong global presence, diverse product range and the discipline and dedication of our employees around the world were instrumental in achieving these results.”
Was this article valuable?
Here are more articles you may enjoy.