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Insurance Giant Expected to Post Biggest Ever Corporate Loss


Two government bailouts apparently have not been enough to keep one of the world's biggest insurance companies from again teetering on the brink of collapse.

Reuters and CNBC television say American International Group will report a $60 billion loss next week. It would be the largest corporate loss in history.

AIG was once the largest insurance company in the world, but has only survived thanks to $150 billion from the U.S. government.

AIG is talking with government officials in an attempt to secure even more money, but media reports say the company is also preparing to file for bankruptcy if the talks break down.

The U.S. government currently owns an almost 80 percent stake in AIG, which suffered major losses last year in investments linked to the housing market.

At that time, the Federal Reserve - the U.S. central bank - argued the bailout was necessary because the insurance giant's failure would add to "already significant" levels of fragility in the financial markets.

The latest concerns about AIG come as the U.S. government is under pressure to take steps to save a growing number of companies from collapse.

U.S. investors have been growing increasingly concerned that the government may need to take over, or nationalize, two of the largest U.S. banks, sending the major stock indexes sharply lower over the past few days.

The government has already given Citigroup and Bank of America, a private bank, a combined $90 billion in loans, but the White House, the Treasury Department and growing number of officials, including Federal Deposit Insurance Corporation chair Sheila Bair, say the government has no desire to nationalize any private banks.

Bank of America has even sent a note to its employees saying it is not discussing nationalization with government officials.

Two of the three biggest U.S. automakers have also gotten money from the government. General Motors and Chrysler have received about $17 billion and are asking for billions more.


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