American International Group reported slightly higher net income in the third quarter compared to the prior year, and said its property and casualty pre-tax operating income grew 33 percent to $1.0 billion due to improved underwriting results.
The company reported net income attributable to AIG of $2.2 billion for the quarter ended September 30, 2013, compared to $1.9 billion for the third quarter of 2012.
Analysts at Achilles Research said the results showed AIG was making “another vital step” in shaking off the bailout image earned during the financial crisis. Analysts there called the results “impressive.”
AIG said commercial and personal lines net premiums written grew 2 and 4 percent, respectively, in the third quarter 2013. These numbers excluded the effects of foreign exchange, a change in the timing of recognizing excess of loss ceded premiums and loss sensitive premium adjustments, the company said.
The company said that its commercial insurance operations continue to focus on growing higher value lines of business and rate strengthening. Its consumer Insurance continues to grow across product lines, expanding direct marketing as part of its multi-channel distribution strategy, AIG said.
On the conference call with analysts this morning, AIG president and CEO Robert H. Benmosche said AIG is still working with a consortium of Asian investors to divest a major stake in its International Leasing Finance Corporation non-core business. Benmosche said AIG believes it can close the ILFC deal as it was original announced some months ago, but accounting rules will force the company this quarter to make some choices, including maybe the decision to instead move forward with an IPO.
Benmosche called the third quarter performance “solid,” and said it “underscores the strong fundamentals of our businesses, and builds upon the momentum that we generated in the first half of this year.”
He said insurance operations reported improved pre-tax operating profits this quarter from the third quarter of 2012, and, “we continue to remain optimistic about the future. “
The company also declared a quarterly dividend of 10 per common share which will be paid on December 19, 2013.
“The continuation of a regular dividend highlights AIG's immense progress since it was bailed out five years ago,” Achilles Research analysts said.
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