2007 Annual Report - AIG.com

More documents

Recommendations

Info

American International Group, Inc. and Subsidiaries Notes to Consolidated Financial Statements Continued 2. Segment Information include issuing standard and structured notes and other securities and entering into guaranteed investment agreements (GIAs). Consumer Finance operations include American General Fi- nance Inc. (AGF) as well as AIG Consumer Finance Group Inc. (AIGCFG). AGF and AIGCFG provide a wide variety of consumer finance products, including non-conforming real estate mortgages, consumer loans, retail sales finance and credit-related insurance to customers both domestically and overseas, particularly in emerging and developing markets. Asset Management: AIG’s Asset Management operations com- prise a wide variety of investment-related services and investment products. Such services and products are offered to individuals, pension funds and institutions globally through AIG’s Spread- Based Investment business, Institutional Asset Management, and Brokerage Services and Mutual Funds business. Revenues in the Asset Management segment represent investment income with respect to spread-based products and management, advisory and incentive fees. Continued capital markets, consumer finance and insurance premium finance. AIG’s Aircraft Leasing operations represent the operations of International Lease Finance Corporation (ILFC), which generates its revenues primarily from leasing new and used commercial jet aircraft to domestic and foreign airlines. Revenues also result from the remarketing of commercial jets for its own account, and remarketing and fleet management services for airlines and for financial institutions. Capital Markets represents the operations of AIGFP, which engages as principal in a wide variety of financial transactions, including standard and customized financial products involving commodities, credit, currencies, energy, equities and rates and provides credit protection through credit default swaps on certain super senior tranches of collateralized debt obligations (CDOs). AIGFP also invests in a diversified portfolio of securities and principal investments and engages in borrowing activities that 148 AIG 2007 Form 10-K
American International Group, Inc. and Subsidiaries 2. Segment Information Continued The following table summarizes AIG’s operations by reporting segment for the years ended December 31, 2007, 2006 and 2005: Operating Segments Life Insurance Consolidation General & Retirement Financial Asset and (in millions) Insurance Services (a) Services (a) Management (a) Other (a)(b) Total Eliminations (a) Consolidated 2007 Total revenues (c)(d)(e) $ 51,708 $ 53,570 $ (1,309) $ 5,625 $ 457 $ 110,051 $ 13 $ 110,064 Interest expense 29 128 7,794 567 1,170 9,688 — 9,688 Operating income (loss) before minority interest (d)(e) 10,526 8,186 (9,515) 1,164 (2,140) 8,221 722 8,943 Income taxes (benefits) 2,393 1,494 (3,260) 334 537 1,498 (43) 1,455 Depreciation expense 300 392 1,831 88 179 2,790 — 2,790 Capital expenditures 354 532 4,569 3,557 271 9,283 — 9,283 Year-end identifiable assets 181,708 615,386 203,894 77,274 126,874 1,205,136 (144,631) 1,060,505 2006 Total revenues (c)(d) $ 49,206 $ 50,878 $ 7,777 $ 4,543 $ 483 $ 112,887 $ 500 $ 113,387 Interest expense 23 74 6,005 105 744 6,951 — 6,951 Operating income (loss) before minority interest (d) 10,412 10,121 383 1,538 (1,435) 21,019 668 21,687 Income taxes (benefits) 2,351 2,892 (26) 575 719 6,511 26 6,537 Depreciation expense 274 268 1,655 13 164 2,374 — 2,374 Capital expenditures 375 711 6,278 835 244 8,443 — 8,443 Year-end identifiable assets 167,004 550,957 202,485 78,275 107,517 1,106,238 (126,828) 979,410 2005 Total revenues (c)(d) $ 45,174 $ 48,020 $ 10,677 $ 4,582 $ 344 $ 108,797 $ (16) $ 108,781 Interest expense 7 83 5,164 11 408 5,673 — 5,673 Operating income (loss) before minority interest (d) 2,315 8,965 4,424 1,963 (2,765) (f) 14,902 311 15,213 Income taxes (benefits) 169 2,407 1,418 723 (587) 4,130 128 4,258 Depreciation expense 273 268 1,447 43 169 2,200 — 2,200 Capital expenditures 417 590 6,300 25 194 7,526 — 7,526 Year-end identifiable assets 150,667 489,331 161,919 69,584 94,047 965,548 (112,500) 853,048 (a) Beginning in 2007, revenues and operating income related to certain foreign investment contracts, which were historically reported as a component of the Asset Management segment, are now reported in the Life Insurance & Retirement Services segment, net realized capital gains and losses; including derivative gains and losses and foreign exchange transaction gains and losses for Financial Services entities other than AIGFP and Asset Management entities, which were previously reported as part of AIG’s Other category, are now included in Asset Management and Financial Services revenues and operating income; and revenues and operating income related to consolidated managed partnerships and funds, which were historically reported in the Asset Management segment, are now being reported in Consolidation and eliminations. All prior periods have been revised to conform to the current presentation. (b) Includes AIG Parent and other operations that are not required to be reported separately. The following table presents the operating loss for AIG’s Other category for the years ended December 31, 2007, 2006 and 2005: For the Years Ended December 31, (in millions) 2007 2006 2005 Operating income (loss): Equity earnings in partially owned companies* $ 157 $ 193 $ (124) Interest expense (1,223) (859) (541) Unallocated corporate expenses (560) (517) (413) Compensation expense — SICO Plans (39) (108) (205) Compensation expense — Starr tender offer — (54) — Net realized capital gains (losses) (409) (37) 269 Regulatory settlement costs — — (1,644) Other miscellaneous, net (66) (53) (107) Total Other $ (2,140) $ (1,435) $ (2,765) * Includes current year catastrophe-related losses from unconsolidated entities of $312 million in 2005. There were no significant catastrophe-related losses from unconsolidated entities in 2007 and 2006. AIG 2007 Form 10-K 149
Page 1 and 2:
AMERICAN INTERNATIONAL GROUP, INC.
Page 3 and 4:
FINANCIAL HIGHLIGHTS (in millions,
Page 5 and 6:
overall financial condition, althou
Page 7 and 8:
Group Executive Committee We are ad
Page 9 and 10:
AIG’s life insurance network is t
Page 11 and 12:
We have also begun to address the e
Page 13 and 14:
WHAT WE SEE The ability to see and
Page 15 and 16:
The Major Accounts Practice within
Page 17 and 18:
Around the world, the middle class
Page 19 and 20:
WE SEE GROWTH OPPORTUNITIES IN EMER
Page 21 and 22:
To grow the strength of the AIG glo
Page 23 and 24:
Since 2003, the AIG Disaster Relief
Page 25 and 26:
RESPECT Respect encompasses how we
Page 27 and 28:
Life Insurance & Retirement Service
Page 29 and 30:
Domestic Brokerage Group— Gross P
Page 31 and 32:
In the summer of 2007, widespread f
Page 33 and 34:
in gross premiums written. It launc
Page 35 and 36:
It grew new business premiums from
Page 37 and 38:
emerging markets for its services,
Page 39 and 40:
ILFC—Revenues by Region Total = $
Page 41 and 42:
AIG Investments acquired a 94 perce
Page 43 and 44:
and changing interest rates, as wel
Page 45 and 46:
American International Group, Inc.
Page 47 and 48:
Page 49 and 50:
Page 51 and 52:
Page 53 and 54:
Page 55 and 56:
UNITED STATES SECURITIES AND EXCHAN
Page 57 and 58:
Page 59 and 60:
Page 61 and 62:
Page 63 and 64:
Page 65 and 66:
Page 67 and 68:
Page 69 and 70:
Page 71 and 72:
Page 73 and 74:
Page 75 and 76:
Page 77 and 78:
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87 and 88:
Page 89 and 90:
Page 91 and 92:
Page 93 and 94:
Page 95 and 96:
Page 97 and 98:
Page 99 and 100:
Page 101 and 102:
Page 103 and 104:
Page 105 and 106:
Page 107 and 108:
Page 109 and 110:
Page 111 and 112:
Page 113 and 114:
Page 115 and 116:
Page 117 and 118:
Page 119 and 120:
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Page 145 and 146:
Page 147 and 148:
Page 149 and 150:
Page 151 and 152: American International Group, Inc.
Page 191 and 192: Index of Notes to Consolidated Fina
Page 201: American International Group, Inc.
Page 253 and 254:
Page 255 and 256:
Page 257 and 258:
Page 259 and 260:
Page 261 and 262:
Page 263 and 264:
Page 265 and 266:
Page 267 and 268:
Page 269 and 270:
Page 271 and 272:
Page 273 and 274:
Page 275 and 276:
SHAREHOLDER INFORMATION Corporate H
show all

2007 Annual Report - AIG.com

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?