Date Published : Friday, September 19, 2008
Australia's largest home and car insurer Insurance Australia Group (IAG) has moved to assure shareholders and the media that it is not troubled insurance giant AIG, nor is it related to AIG.
Both Suncorp-Metway and IAG have informed the Australian stock exchange this week that they have "no exposure" AIG or Lehman Brothers, Bloomberg reported.
The news provider claimed that AIG - the biggest insurer in the US - has this week accepted a USD$85 billion ($107 billion) loan from the federal government in return for a majority equity stake in the company in order to prevent "the worst financial collapse in history".
Furthermore, it was reported that the fourth-largest investment bank in the US, Lehman Brothers filed for bankruptcy this week.
In a statement to the exchange, IAG said it would like to inform shareholders that "some media coverage of issues associated with AIG has incorrectly named the organisation concerned as IAG".
The company said that IAG "is not related to AIG", nor does it have "material exposure to AIG".
"IAG is financially sound and will continue to deliver for its customers, people, shareholders and the broader community," the company furthered.
IAG is an international general insurance group with operations in Australia, New Zealand, the UK and Asia with its combined businesses underwriting around $7.8 billion of premium per annum and employing around 15,000 people.
According to the Age, a number of Australian banks are attempting to "extract themselves from about $410 million worth of exposure to Lehman Brothers".
It is claimed that ANZ has the biggest direct exposure to Lehman Brothers ($152 million) while CBA has around $150 million worth of exposure to the Wall Street firm.
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