AIG beats third-quarter estimates, will buy back more shares
NEW YORK (Reuters) - Insurer American International Group AIG.N on Monday reported better-than-expected third quarter earnings, bolstered in part by improved performance at core insurance operations.
After-tax operating income jumped 23 percent from a year earlier. Chief Executive Officer Peter Hancock said the company remains "disciplined in our approach to balancing growth, profitability, and risk and focused on maintaining the strength of our industry-leading balance sheet."
The company also declared a dividend of 12.5 cents per share as it did in the previous quarter. In addition, AIG's board authorized a further up to $1.5 billion share buybacks, in addition to the $3.4 billion of AIG stock the insurer has repurchased this year. AIG shares rose 0.43 percent to close at $53.8 on Monday.
"Overall, it was a good quarter," said S&P Capital IQ equity analyst Cathy Seifert. "I think it was a triple, I don't think it was a home run."
Hancock took the reins at the company on Sept. 1, moving from his previous post as head of the company's property-casualty business.
Hancock succeeded Bob Benmosche, who was widely credited with helping turn the company around after bad bets on derivatives nearly sank the company during the financial crisis.
The company has since focused more closely on its core businesses and reinstated a dividend last year.
"Improvements in AIG's accident year-loss ratio show management's underwriting efforts having an impact," said Sanford C. Bernstein & Co analyst Josh Stirling.
For the third quarter, AIG reported net income of $2.19 billion, or $1.52 per share, compared with net income of $2.17 billion, or $1.46 per share, a year earlier. Continued...