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DISCONTINUED OPERATIONS
 6 Months Ended
Jun. 30, 2012
DISCONTINUED OPERATIONS  
DISCONTINUED OPERATIONS

13. DISCONTINUED OPERATIONS

    The results of operations for the following sales are presented as discontinued operations through the date of disposition in the Consolidated Statement of Operations for the three and six months ended June 30, 2011:

    See Note 9(D) herein for a discussion of guarantees and indemnifications associated with sales of businesses.

  • •
    AIG Star and AIG Edison Sale — On September 30, 2010, AIG entered into a definitive agreement with Prudential Financial, Inc. for the sale of its Japan-based insurance subsidiaries, AIG Star and AIG Edison, for total consideration of $4.8 billion, including the assumption of certain outstanding debt totaling $0.6 billion owed by AIG Star and AIG Edison. The transaction closed on February 1, 2011 and AIG recognized a pre-tax gain of $3.5 billion on the sale that is reflected in Income (loss) from discontinued operations in the Consolidated Statement of Operations.

    •
    Nan Shan Sale — On January 12, 2011, AIG entered into an agreement to sell its 97.57 percent interest in Nan Shan Life Insurance Company, Ltd. to a Taiwan-based consortium; the transaction closed on August 18, 2011. For the three and six months ended June 30, 2011, AIG recorded a pre-tax loss of $559 million and $864 million, respectively.

The following table summarizes income (loss) from discontinued operations:

   
(in millions)
   Three Months Ended
June 30, 2011
   Six Months Ended
June 30, 2011
  
   

Revenues:

              

Premiums

   $ 1,548   $ 4,097  

Net investment income

     497     1,209  

Net realized capital gains

     595     964  

Other income

     -     5  
   

Total revenues

     2,640     6,275  
   

Benefits, claims and expenses

     2,001     5,096  

Interest expense allocation

     -     2  
   

Income from discontinued operations

     639     1,177  
   

Gain (loss) on sales

     (719 )   2,309  
   

Income (loss) from discontinued operations, before tax expense (benefit)

     (80 )   3,486  
   

Income tax expense (benefit)

     (43 )   938  
   

Income (loss) from discontinued operations, net of income tax

   $ (37 ) $ 2,548