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Insurer AIG profit climbs 29 percent in 1st quarter, well above Wall Street projection

Insurer AIG profit climbs 29 percent in 1st quarter, well above Wall Street projection

American International Group Inc., one of the world's largest insurers, said Thursday its profit rose more than 29 percent in the first quarter on strong growth in underwriting results and investment income.
That handily beat Wall Street estimates.
AIG, which is based in New York, said net income was $4.13 billion (euro3.05 billion), or $1.58 (euro1.17) a share, in the January-March period, up from $3.2 billion (euro2.37 billion), or $1.22 (euro.90) a share, a year earlier.
Excluding one-time items, profit was $4.4 billion (euro3.25 billion), or $1.68 (euro1.24) a share, up from $3.4 billion (euro2.51 billion), or $1.29 (euro.95) a share, a year earlier.
Revenue was $30.65 billion (euro22.66 billion), up 12 percent from $27.28 billion (euro20.17 billion).
Analysts surveyed by Thomson Financial had projected net income of $1.54 (euro1.14) a share on revenue of $29.45 billion (euro21.77 billion).
AIG's president and chief executive, Martin J. Sullivan, said in a statement accompanying the results that "AIG had a very good quarter," with strong performance in general insurance businesses worldwide and foreign life insurance. "Asset management results increased compared to the first quarter of 2006," he added.
Sullivan said the company continued to seek growth opportunities overseas, saying, "We believe these businesses complement our existing operations ... and offer future growth potential."
Operating income from general insurance operations rose to $3.1 billion (euro2.29 billion) in the first quarter from $2.33 billion (euro1.72 billion) a year earlier, with both underwriting profit and net investment income rising.
But operating income was down to $2.3 billion (euro1.7 billion) in the first quarter from $2.6 billion (euro1.92 billion) a year earlier in life insurance and retirement services, mainly because of a decline in deposits and increased surrender activity in domestic retirement services, AIG said.
Financial services operations turned a profit of $292 million (euro215.86 million), while operating income in asset management operations nearly doubled to $994 million (euro734.83 million).
Sullivan was selected by AIG's board in March 2005 to replace longtime Chief Executive Officer Maurice "Hank" Greenberg amid investigations into the company's record keeping.
AIG in February 2006 agreed to pay $1.64 billion (euro1.21 billion) to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies.
In regular trading Thursday, AIG shares rose 20 cents to $72.20.
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On the Net:
http://www.aig.com