WANSHINGTON: Insurer AIG, rescued by the US government at the peak of the 2008 financial crisis, will no longer face the stricter oversight of a “too big to fail” institution, the Treasury Department said Friday.
Regulators with the Financial Stability Oversight Council voted 6-3 to relieve AIG of the designation that its failure could “pose a threat to US financial stability,” the department said.
The move greatly eases the regulatory oversight of AIG, which was rescued in a government bailout at the height of the crisis because of its close links with other key financial institutions.
The government saved AIG with a controversial $182 billion bailout that was later repaid in full by the insurer.
It was one of the most momentous decisions taken at the height of the crisis.
Once the world’s largest insurer, AIG was teetering on the verge of collapse under tens of billions of dollars of souring, unhedged derivatives contracts in September 2008 when it sought liquidity from the New York Fed.
On the same climactic weekend that they let investment banking giant Lehmann Brothers fail, the government agreed to lend AIG an initial $85 billion in exchange for a 79.9 percent controlling stake.
AIG was saved as the global financial system stood at the brink of disaster.
If AIG had failed, former Treasury Secretary Henry Paulson said in 2015 in a trial over whether the bailout was even legal, “it would have taken down the financial system and hurt millions of Americans.”
AIG recovered its leading role in the US industrial and property insurance market after it unloaded key international units. The US Treasury sold its final shares in December 2012.
“The Council has worked diligently to thoroughly reevaluate whether AIG poses a risk to financial stability,” Treasury Secretary Steven Mnuchin said Friday.
“This action demonstrates our commitment to act decisively to remove any designation if a company does not pose a threat to financial stability.”
Mnuchin was joined in the majority by other regulators including Federal Reserve Chair Janet Yellen.
Those voting against included Richard Cordray, director of the Consumer Financial Protection Bureau.
AIG applauded the vote.
“The Council’s decision reflects the substantial and successful de-risking that AIG’s employees have achieved since 2008,” said chief executive Brian Duperreault.
“The company is committed to continued vigilant risk management and to working closely with our numerous regulators to enable a strong AIG to continue to serve our clients.”
Shares in AIG rose 1.0 percent in after-hours trade to $62.
AIG stripped of ‘too big to fail’ label by US regulators
AIG stripped of ‘too big to fail’ label by US regulators
Saudi Arabia’s foreign reserves rise to a 6-year high of $475bn
RIYADH: Saudi Arabia’s foreign reserves climbed 3 percent month on month in January to SR1.78 trillion, up SR58.7 billion ($15.6 billion) from December and marking a six-year high.
On an annual basis, the Saudi Central Bank’s net foreign assets rose by 10 percent, equivalent to SR155.8 billion, according to data from the Saudi Central Bank, Argaam reported.
The reserve assets, a crucial indicator of economic stability and external financial strength, comprise several key components.
According to the central bank, also known as SAMA, the Kingdom’s reserves include foreign securities, foreign currency, and bank deposits, as well as its reserve position at the International Monetary Fund, Special Drawing Rights, and monetary gold.
The rise in reserves underscores the strength and liquidity of the Kingdom’s financial position and aligns with Saudi Arabia’s goal of strengthening its financial safety net as it advances economic diversification under Vision 2030.
The value of foreign currency reserves, which represent approximately 95 percent of the total holdings, increased by about 10 percent during January 2026 compared to the same month in 2025, reaching SR1.68 trillion.
The value of the reserve at the IMF increased by 9 percent to reach SR13.1 billion.
Meanwhile, SDRs rose by 5 percent during the period to reach SR80.5 billion.
The Kingdom’s gold reserves remained stable at SR1.62 billion, the same level it has maintained since January 2008.
Saudi Arabia’s foreign reserve assets saw a monthly rise of 5 percent in November, climbing to SR1.74 trillion, according to the Kingdom’s central bank.
Overall, the continued advancement in reserve assets highlights the strength of Saudi Arabia’s fiscal and monetary buffers. These resources support the national currency, help maintain financial system stability, and enhance the country’s ability to navigate global economic volatility.
The sustained accumulation of foreign reserves is a critical pillar of the Kingdom’s economic stability. It directly reinforces investor confidence in the riyal’s peg to the US dollar, a foundational monetary policy, by providing SAMA with ample resources to defend the currency if needed.
Furthermore, this financial buffer enhances the nation’s sovereign credit profile, lowers national borrowing costs, and provides essential fiscal space to navigate global economic volatility while continuing to fund its ambitious Vision 2030 transformation agenda.
