INFORMATION PROVIDED IN CONNECTION WITH OUTSTANDING DEBT

6 Months Ended

Jun. 30, 2013

INFORMATION PROVIDED IN CONNECTION WITH OUTSTANDING DEBT

INFORMATION PROVIDED IN CONNECTION WITH OUTSTANDING DEBT

16. INFORMATION PROVIDED IN CONNECTION WITH OUTSTANDING DEBT

The following condensed consolidating financial statements reflect the results of AIG Life Holdings, Inc. (AIGLH), a holding company and a wholly owned subsidiary of AIG. AIG provides a full and unconditional guarantee of all outstanding debt of AIGLH.

Condensed Consolidating Balance Sheets

(in millions)	American International Group, Inc. (As Guarantor)		AIGLH		Other Subsidiaries			Reclassifications and Eliminations			Consolidated AIG
June 30, 2013
Assets:
Short-term investments	$	10,141	$	–	$	12,080		$	(2,006	)	$	20,215
Other investments(a)		7,189		–		330,803			–			337,992
Total investments		17,330		–		342,883			(2,006	)		358,207
Cash		107		31		1,624			–			1,762
Loans to subsidiaries(b)		32,394		–		1,446			(33,840	)		–
Investment in consolidated subsidiaries(b)		68,722		39,770		–			(108,492	)		–
Other assets, including current and deferred income taxes		23,635		140		121,902			624			146,301
Assets held for sale		–		–		31,168			–			31,168
Total assets	$	142,188	$	39,941	$	499,023		$	(143,714	)	$	537,438
Liabilities:
Insurance liabilities	$	–	$	–	$	274,433		$	(118	)	$	274,315
Long-term debt		31,787		1,393		9,434			–			42,614
Other liabilities, including intercompany balances(a)(c)		11,807		149		85,099			(1,277	)		95,778
Loans from subsidiaries(b)		1,131		350		32,360			(33,841	)		–
Liabilities held for sale		–		–		26,496			–			26,496
Total liabilities		44,725		1,892		427,822			(35,236	)		439,203
Redeemable noncontrolling interests (see Note 12)		–		–		80			–			80
Total AIG shareholders' equity		97,463		38,049		70,429			(108,478	)		97,463
Non-redeemable noncontrolling interests		–		–		692			–			692
Total equity		97,463		38,049		71,121			(108,478	)		98,155
Total liabilities and equity	$	142,188	$	39,941	$	499,023		$	(143,714	)	$	537,438
December 31, 2012
Assets:
Short-term investments	$	14,764	$	–	$	18,323		$	(4,279	)	$	28,808
Other investments(a)		3,902		–		345,706			(2,592	)		347,016
Total investments		18,666		–		364,029			(6,871	)		375,824
Cash		81		73		997			–			1,151
Loans to subsidiaries(b)		35,064		–		5,169			(40,233	)		–
Investment in consolidated subsidiaries(b)		70,781		43,891		(28,239	)		(86,433	)		–
Other assets, including current and deferred income taxes		23,153		150		121,345			(4,955	)		139,693
Assets held for sale		–		–		31,965			–			31,965
Total assets	$	147,745	$	44,114	$	495,266		$	(138,492	)	$	548,633
Liabilities:
Insurance liabilities	$	–	$	–	$	280,533		$	(235	)	$	280,298
Long-term debt		36,366		1,638		10,197			299			48,500
Other liabilities, including intercompany balances(a)(c)		12,375		261		89,976			(9,146	)		93,466
Loans from subsidiaries(b)		1,002		472		41,754			(43,228	)		–
Liabilities held for sale		–		–		27,366			–			27,366
Total liabilities		49,743		2,371		449,826			(52,310	)		449,630
Redeemable noncontrolling interests (see Note 12)		–		–		192			142			334
Total AIG shareholders' equity		98,002		41,743		44,955			(86,698	)		98,002
Non-redeemable noncontrolling interests		–		–		293			374			667
Total equity		98,002		41,743		45,248			(86,324	)		98,669
Total liabilities and equity	$	147,745	$	44,114	$	495,266		$	(138,492	)	$	548,633

(a)  Includes intercompany derivative positions, which are reported at fair value before credit valuation adjustment.

(b)  Eliminated in consolidation.

(c)  For June 30, 2013 and December 31, 2012, includes intercompany tax payables of $6.3 billion and $6.1 billion, respectively, and intercompany derivative liabilities of $527 million and $602 million, respectively, for American International Group, Inc. (As Guarantor) and intercompany tax receivables for $82 million and $120 million, respectively, for AIGLH.

Condensed Consolidating Statements of Income

(in millions)	American International Group, Inc. (As Guarantor)			AIGLH			Other Subsidiaries		Reclassifications and Eliminations			Consolidated AIG
Three Months Ended June 30, 2013
Revenues:
Equity in earnings of consolidated subsidiaries(a)	$	2,374		$	754		$	–	$	(3,128	)	$	–
Other income(b)		673			–			16,726		(84	)		17,315
Total revenues		3,047			754			16,726		(3,212	)		17,315
Expenses:
Interest expense(c)		482			32			36		(15	)		535
Loss on extinguishment of debt		38			–			–		–			38
Other expenses		335			–			13,317		(57	)		13,595
Total expenses		855			32			13,353		(72	)		14,168
Income (loss) from continuing operations before income tax
expense (benefit)		2,192			722			3,373		(3,140	)		3,147
Income tax expense (benefit)		(538	)		(3	)		967		(4	)		422
Income (loss) from continuing operations		2,730			725			2,406		(3,136	)		2,725
Income from discontinued operations, net of income taxes		1			–			32		–			33
Net income (loss)		2,731			725			2,438		(3,136	)		2,758
Less:
Net income from continuing operations attributable to noncontrolling interests		–			–			27		–			27
Net income (loss) attributable to AIG	$	2,731		$	725		$	2,411	$	(3,136	)	$	2,731
Three Months Ended June 30, 2012
Revenues:
Equity in earnings of consolidated subsidiaries(a)	$	1,126		$	84		$	–	$	(1,210	)	$	–
Change in fair value of ML III		1,306			–			–		–			1,306
Other income(b)		50			–			14,930		(65	)		14,915
Total revenues		2,482			84			14,930		(1,275	)		16,221
Expenses:
Interest expense(c)		525			44			62		(64	)		567
Net loss on extinguishment of debt		9			–			–		–			9
Other expenses		926			–			13,050		–			13,976
Total expenses		1,460			44			13,112		(64	)		14,552
Income (loss) from continuing operations before income tax expense (benefit)		1,022			40			1,818		(1,211	)		1,669
Income tax expense (benefit)		(1,310	)		463			356		–			(491	)
Income (loss) from continuing operations		2,332			(423	)		1,462		(1,211	)		2,160
Income from discontinued operations, net of income taxes		–			–			179		–			179
Net income (loss)		2,332			(423	)		1,641		(1,211	)		2,339
Less:
Net income from continuing operations attributable to noncontrolling interests:
Other		–			–			7		–			7
Net income from continuing operations attributable to noncontrolling interests		–			–			7		–			7
Net income (loss) attributable to AIG	$	2,332		$	(423	)	$	1,634	$	(1,211	)	$	2,332

(in millions)	American International Group, Inc. (As Guarantor)			AIGLH			Other Subsidiaries		Reclassifications and Eliminations			Consolidated AIG
Six Months Ended June 30, 2013
Revenues:
Equity in earnings of consolidated subsidiaries(a)	$	4,265		$	1,424		$	–	$	(5,689	)	$	–
Other income(b)		967			–			32,389		(153	)		33,203
Total revenues		5,232			1,424			32,389		(5,842	)		33,203
Expenses:
Interest expense(c)		1,010			68			118		(84	)		1,112
Loss on extinguishment of debt		307			–			71		–			378
Other expenses		593			71			25,127		(57	)		25,734
Total expenses		1,910			139			25,316		(141	)		27,224
Income (loss) from continuing operations before income tax
expense (benefit)		3,322			1,285			7,073		(5,701	)		5,979
Income tax expense (benefit)		(1,618	)		(14	)		2,752		(4	)		1,116
Income (loss) from continuing operations		4,940			1,299			4,321		(5,697	)		4,863
Income (loss) from discontinued operations, net of income taxes		(3	)		–			129		–			126
Net income (loss)		4,937			1,299			4,450		(5,697	)		4,989
Less:
Net income from continuing operations attributable to noncontrolling interests		–			–			52		–			52
Net income (loss) attributable to AIG	$	4,937		$	1,299		$	4,398	$	(5,697	)	$	4,937
Six Months Ended June 30, 2012
Revenues:
Equity in earnings of consolidated subsidiaries(a)	$	3,946		$	136		$	–	$	(4,082	)	$	–
Change in fair value of ML III		1,957			–			601		–			2,558
Other income(b)		701			49			30,679		(269	)		31,160
Total revenues		6,604			185			31,280		(4,351	)		33,718
Expenses:
Interest expense(c)		1,169			98			133		(268	)		1,132
Net loss on extinguishment of debt		9			–			–		–			9
Other expenses		1,105			–			25,337		–			26,442
Total expenses		2,283			98			25,470		(268	)		27,583
Income (loss) from continuing operations before income tax expense (benefit)		4,321			87			5,810		(4,083	)		6,135
Income tax expense (benefit)		(1,219	)		463			1,346		–			590
Income (loss) from continuing operations		5,540			(376	)		4,464		(4,083	)		5,545
Income from discontinued operations, net of income taxes		–			–			243		–			243
Net income (loss)		5,540			(376	)		4,707		(4,083	)		5,788
Less:
Net income (loss) from continuing operations attributable to noncontrolling interests:
Nonvoting, callable, junior and senior preferred interests		–			–			–		208			208
Other		–			–			40		–			40
Net income from continuing operations attributable to noncontrolling interests		–			–			40		208			248
Net income (loss) attributable to AIG	$	5,540		$	(376	)	$	4,667	$	(4,291	)	$	5,540

(a)  Eliminated in consolidation.

(b)  Includes intercompany income of $74 million and $60 million for the three-month periods ended June 30, 2013 and 2012, respectively, and $140 million and $131 million for the six-month period ended June 30, 2013 and 2012, respectively, for American International Group, Inc. (As Guarantor).

(c)  Includes intercompany interest expense of $2 million and $3 million for the three-month periods ended June 30, 2013 and 2012, respectively, and $5 million and $136 million for the six-month period ended June 30, 2013 and 2012, respectively, for American International Group, Inc. (As Guarantor).

Condensed Consolidating Statements of Comprehensive Income

(in millions)	American International Group, Inc. (As Guarantor)			AIGLH			Other Subsidiaries			Reclassifications and Eliminations			Consolidated AIG
Three Months Ended June 30, 2013
Net income (loss)	$	2,731		$	725		$	2,438		$	(3,136	)	$	2,758
Other comprehensive income (loss)		(4,800	)		(3,351	)		(4,707	)		8,037			(4,821	)
Comprehensive income (loss)		(2,069	)		(2,626	)		(2,269	)		4,901			(2,063	)
Total comprehensive income attributable to noncontrolling interests		–			–			6			–			6
Comprehensive income (loss) attributable to AIG	$	(2,069	)	$	(2,626	)	$	(2,275	)	$	4,901		$	(2,069	)
Three Months Ended June 30, 2012
Net income (loss)	$	2,332		$	(423	)	$	1,641		$	(1,211	)	$	2,339
Other comprehensive income (loss)		918			934			1,720			(2,662	)		910
Comprehensive income (loss)		3,250			511			3,361			(3,873	)		3,249
Total comprehensive loss attributable to noncontrolling interests		–			–			(1	)		–			(1	)
Comprehensive income (loss) attributable to AIG	$	3,250		$	511		$	3,362		$	(3,873	)	$	3,250
Six Months Ended June 30, 2013
Net income (loss)	$	4,937		$	1,299		$	4,450		$	(5,697	)	$	4,989
Other comprehensive income (loss)		(5,535	)		(3,990	)		(5,627	)		9,596			(5,556	)
Comprehensive income (loss)		(598	)		(2,691	)		(1,177	)		3,899			(567	)
Total comprehensive income attributable to noncontrolling interests		–			–			31			–			31
Comprehensive income (loss) attributable to AIG	$	(598	)	$	(2,691	)	$	(1,208	)	$	3,899		$	(598	)
Six Months Ended June 30, 2012
Net income (loss)	$	5,540		$	(376	)	$	4,707		$	(4,083	)	$	5,788
Other comprehensive income (loss)		2,638			1,759			3,695			(5,457	)		2,635
Comprehensive income (loss)		8,178			1,383			8,402			(9,540	)		8,423
Total comprehensive income attributable to noncontrolling interests		–			–			37			208			245
Comprehensive income (loss) attributable to AIG	$	8,178		$	1,383		$	8,365		$	(9,748	)	$	8,178

Condensed Consolidating Statements of Cash Flows

(in millions)	American International Group, Inc. (As Guarantor)			AIGLH			Other Subsidiaries and Eliminations			Consolidated AIG
Six Months Ended June 30, 2013
Net cash (used in) provided by operating activities — continuing operations	$	698		$	1,809		$	(2,188	)	$	319
Net cash provided by operating activities — discontinued operations		–			–			1,355			1,355
Net cash (used in) provided by operating activities		698			1,809			(833	)		1,674
Cash flows from investing activities:
Sales of investments		646			–			38,446			39,092
Purchase of investments		(4,179	)		–			(37,672	)		(41,851	)
Loans to subsidiaries — net		2,427			–			(2,427	)		–
Contributions to subsidiaries — net		(86	)		(1	)		87			–
Net change in restricted cash		422			–			534			956
Net change in short-term investments		4,129			–			4,395			8,524
Other, net		205			–			(622	)		(417	)
Net cash (used in) provided by investing activities — continuing operations		3,564			(1	)		2,741			6,304
Net cash (used in) investing activities — discontinued operations		–			–			(233	)		(233	)
Net cash (used in) provided by investing activities		3,564			(1	)		2,508			6,071
Cash flows from financing activities:
Issuance of long-term debt		–			–			486			486
Repayments of long-term debt		(4,107	)		(245	)		(1,051	)		(5,403	)
Intercompany loans — net		128			(123	)		(5	)		–
Cash dividends paid		–			(1,482	)		1,482			–
Other, net		(257	)		–			(762	)		(1,019	)
Net cash (used in) provided by financing activities — continuing operations		(4,236	)		(1,850	)		150			(5,936	)
Net cash (used in) financing activities — discontinued operations		–			–			(1,119	)		(1,119	)
Net cash (used in) financing activities		(4,236	)		(1,850	)		(969	)		(7,055	)
Effect of exchange rate changes on cash		–			–			(70	)		(70	)
Change in cash		26			(42	)		636			620
Cash at beginning of period		81			73			997			1,151
Reclassification to assets held for sale		–			–			(9	)		(9	)
Cash at end of period	$	107		$	31		$	1,624		$	1,762
Six Months Ended June 30, 2012
Net cash (used in) provided by operating activities — continuing operations	$	(272	)	$	2,290		$	(1,812	)	$	206
Net cash provided by operating activities — discontinued operations		–			–			1,426			1,426
Net cash (used in) provided by operating activities		(272	)		2,290			(386	)		1,632
Cash flows from investing activities:
Sales of investments		1,055			–			45,836			46,891
Purchase of investments		(526	)		–			(34,426	)		(34,952	)
Loans to subsidiaries — net		3,410			–			(3,410	)		–
Contributions to subsidiaries — net		(106	)		–			106			–
Net change in restricted cash		(370	)		–			86			(284	)
Net change in short-term investments		2,898			–			(3,757	)		(859	)
Other, net		342			–			(219	)		123
Net cash provided by investing activities — continuing operations		6,703			–			4,216			10,919
Net cash (used in) investing activities — discontinued operations		–			–			(48	)		(48	)
Net cash provided by investing activities		6,703			–			4,168			10,871
Cash flows from financing activities:
Issuance of long-term debt		3,504			–			541			4,045
Repayments of long-term debt		(2,981	)		–			(2,290	)		(5,271	)
Intercompany loans — net		(2,014	)		(2,303	)		4,317			–
Purchase of common stock		(5,000	)		–			–			(5,000	)
Other, net		(44	)		–			(6,261	)		(6,305	)
Net cash (used in) financing activities — continuing operations		(6,535	)		(2,303	)		(3,693	)		(12,531	)
Net cash (used in) financing activities — discontinued operations		–			–			(190	)		(190	)
Net cash (used in) financing activities		(6,535	)		(2,303	)		(3,883	)		(12,721	)
Effect of exchange rate changes on cash		–			–			(24	)		(24	)
Change in cash		(104	)		(13	)		(125	)		(242	)
Cash at beginning of period		176			13			1,285			1,474
Cash at end of period	$	72		$	–		$	1,160		$	1,232

Supplementary Disclosure of Condensed Consolidating Cash Flow Information

(in millions)	American International Group, Inc. (As Guarantor)			AIGLH			Other Subsidiaries and Eliminations			Consolidated AIG
Cash (paid) received during the six month period ended June 30, 2013 period for:
Interest:
Third party	$	(1,117	)	$	(57	)	$	(1,234	)	$	(2,408	)
Intercompany		(5	)		(14	)		19			–
Taxes:
Income tax authorities	$	(6	)	$	–		$	(203	)	$	(209	)
Intercompany		501			(78	)		(423	)		–
Cash (paid) received during the six month period ended June 30, 2012 period for:
Interest:
Third party	$	(1,136	)	$	(64	)	$	(888	)	$	(2,088	)
Intercompany		(128	)		(47	)		175			–
Taxes:
Income tax authorities	$	2		$	–		$	(208	)	$	(206	)
Intercompany		605			(41	)		(564	)		–

American International Group, Inc. (As Guarantor) supplementary disclosure of non-cash activities:

Six Months Ended June 30, (in millions)	2013		2012
Intercompany non-cash financing and investing activities:
Capital contributions
in the form of bond available for sale securities	$	–	$	959
to subsidiaries through forgiveness of loans		341
Return of capital and dividend received
in the form of cancellation of intercompany loan		–		9,303
in the form of bond trading securities		–		3,320
Other capital contributions — net		245		339