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AIG REPORTS SECOND QUARTER 1993 NET INCOME ROSE 14.8 PERCENT

 NEW YORK, July 29 /PRNewswire / -- American International Group, Inc. (NYSE: AIG) (AIG) today reported that its net income for the second quarter of 1993 increased 14.8 percent to $481.6 million, compared to $419.6 million in the second quarter of 1992. For the first six months of 1993, net income totalled $977.6 million, an increase of 13.8 percent, compared to $859.2 million in the same period of 1992.
 Following is a comparative table of second quarter and six months
information (in millions, except per share amounts). Per share results are shown before and after adjustment for the previously announced three-for-two split of the company's common stock in the form of a 50 percent common stock dividend payable July 30, 1993.
 SECOND QUARTER SIX MONTHS
 1993 1992 1993 1992
 Net income, as reported $481.6 $419.6 $977.6 $859.2
 Income, as adjusted(a) $463.6 $402.5 $916.3 $793.4
 PER SHARE RESULTS:
 Pre-split:
 Net income, as reported$ 2.27 $ 1.98 $ 4.61 $ 4.04
 Income, as adjusted(a) $ 2.19 $ 1.90 $ 4.32 $ 3.73
 Avg. shares outstanding 211.6 211.6 211.6 211.9
 Post-split:
 Net income, as reported$ 1.52 $ 1.32 3.08 $ 2.70
 Income, as adjusted(a) $ 1.46 $ 1.27 $ 2.88 $ 2.49
 Avg. shares outstanding 317.4 317.4 317.4 317.9
 (a) Adjusted to exclude cumulative effect of accounting changes recognized January 1, 1992 and 1993 and realized capital gains, net of taxes.
 Income before income taxes for the second quarter of 1993 amounted to $650.2 million, an increase of 16.3 percent over the $559.0 million reported in
1992. For the first six months of 1993, income before income taxes and the cumulative effect of accounting changes increased 16.8 percent to
 $1.29 billion from $1.11 billion reported last year. Included in these results were pretax realized capital gains of $27.8 million and $62.4
million for the second quarter and six months of 1993, respectively, compared to $26.5 million and $54.6 million for the same periods in 1992.
 Revenues in the second quarter of 1993 rose 10.7 percent to $5.02 billion from $4.53 billion in the year-earlier quarter. For the first six months, revenues totalled $9.66 billion, an increase of 8.6 percent over $8.89 billion in 1992.
 At June 30, 1993, AIG's consolidated assets and shareholders' equity reached all time highs approximating $94 billion and $13.8 billion, respectively.
 Commenting on the quarter's and six months' results, AIG Chairman M.R. Greenberg said, "AIG achieved excellent earnings in the second quarter and six months. Virtually all segments of our business were strong.
 "Operating income for general insurance rose 14.0 percent over last year's quarter. In our domestic brokerage group, the strategy we have been pursuing for the past several years of pruning our book to eliminate underpriced business is showing positive results. While the marketplace is still in a state of transition, we have achieved price increases in a number of classes, particularly specialty lines and property.
 "Results at the New Hampshire Insurance Company also improved, as this company posted an operating profit for the six months, compared to a loss last year. Our strategy of repositioning the New Hampshire and integrating it into the domestic brokerage group has been smooth and is now nearly complete.
 "In our foreign general business, we had an excellent quarter in all major areas of the world. Our Asian general insurance operations had very strong results. In Japan, we had positive growth, in spite of the slowing domestic economy. Latin America had significant growth and Europe was also strong.
 "Our life insurance operations did extremely well, particularly in Asia. In Europe, our life business was considerably improved. AIG's domestic life companies continue to make progress in developing their new distribution system, with an increase in career agencies. Overall, life operating income rose 16.9 percent over last year's quarter.
 "AIG's financial services group also had a strong quarter, as operating income rose 19.9 percent over last year's quarter. International Lease Finance Corporation (ILFC) posted record results, and announced a significant number of new aircraft leases with 12 airlines, including six
new ILFC customers. AIG Trading


Corporation had an excellent quarter, particularly in its foreign
exchange business. AIG Trading's client base continues to expand, and it is recognized as one the world's leading metals traders.
 "AIG Financial Products Corp. (AIGFP) had good operating performance during the quarter and for the six months, although certain investments held by AIGFP have recently experienced financial difficulties
 and suffered rating downgrades. The pretax impact on AIG of the estimated other than temporary
impairment in value of these investments is $125 million. As is
AIG's policy in such situations where credit ratings have
deteriorated significantly, this impairment has been


appropriately recognized by charges to income in current and prior
quarters. The quality of the other invested assets in


AIGFP's portfolio remains excellent, with an average rating of A+ or better.
 "On June 30, AIG announced the formation of two new Bermuda- based companies to provide, respectively, property catastrophe reinsurance and
 high layer excess liability insurance. AIG is the sponsor of International Property Catastrophe Reinsurance Company, Ltd. and co-sponsor of Starr Excess Liability Insurance
Company, Ltd. We own slightly less than 25 percent of each.


These companies respond to growing needs in the international market for property catastrophe cover and high excess liability cover. Both are off to a good start.
 "AIG's cash flow remains strong, and during the quarter we added $208 million to our general insurance net loss and loss adjustment reserves, bringing the total of such net reserves to $17.1 billion at June 30. We hold the highest ratings from the principal rating services."


GENERAL INSURANCE
 General insurance pretax income before realized capital gains for the second quarter of 1993 increased 14.0 percent to $332.4 million, compared to $291.6 million last year. For the first six months of 1993, general insurance pretax income before realized capital gains was $684.2 million, an increase of 14.1 percent over the $599.8 million in 1992.
 Worldwide general insurance net premiums written in the second quarter of 1993 amounted to $2.64 billion, 11.6 percent ahead of the $2.36 billion in 1992. For the first six months of 1993, general insurance net premiums written were $5.08 billion, an increase of 9.8 percent, compared to $4.63 billion last year.
 The general insurance combined ratio was 99.60 in the second quarter of 1993, compared to 100.77 in 1992. For the six months of 1993 and 1992, the combined ratios were 99.59 and 100.43, respectively.
 General insurance net investment income rose 7.0 percent to $328.4 million in the second quarter and 7.0 percent to $659.0 million in the six months of 1993.


LIFE INSURANCE
 AIG's worldwide life insurance operations reported second quarter 1993 pretax income before realized capital gains of $179.7 million, an
 increase of 16.9 percent, compared to $153.7 million in 1992. For the first six months of 1993, life insurance pretax income before realized capital gains increased 16.6 percent to $344.2 million, compared to $295.2 million last year.
 Life insurance premium income increased 20.9 percent in the second quarter
to $1.44 billion from $1.19 billion in 1992. For the first six months, premium income amounted to $2.70 billion, an increase of 19.4 percent, compared to $2.26 billion in 1992.
 Life insurance net investment income rose 16.7 percent to $367.6 million for the second quarter of 1993, compared to $314.9 million for the same period last year. For the first six months, net investment income amounted to $716.9 million, an increase of 15.0 percent, compared to $623.3 million in 1992.


FINANCIAL SERVICES
 Financial services pretax operating income increased 19.9 percent to $99.6 million in the second quarter of 1993, compared to $83.1 million in the same period last year. For the six months of 1993, financial services operating income rose 27.7 percent to $185.8 million, compared to $145.5 million in 1992.


OTHER OPERATIONS
 Agency and service fee pretax operating income for the second quarter was
$16.3 million, 36.5 percent above last year. For the first six months, agency and service fee operating income increased 21.7 percent to $32.3 million from $26.5 million in 1992.
 AIG's equity in the net income of Transatlantic Holdings,


Inc., a reinsurance holding company in which AIG owns a minority interest, amounted to $9.2 million compared to $8.0 million in the second quarter last year. Equity in income of Transatlantic Holdings for the first six months of 1993 was $38.8 million, including $20.7 million related to the cumulative effect of accounting changes, compared to $16.2 million in 1992.
 AIG is the leading U.S.-based international insurance
organization and the nation's largest underwriter of commercial
and industrial coverages. Its member companies write property,
casualty, marine, life and financial services insurance in


approximately 130 countries and jurisdictions, and are engaged in a range
 of financial services businesses. American International


Group, Inc.'s common stock is listed on the New York Stock Exchange as well as the stock exchanges in London, Paris, Switzerland and Tokyo.
 AMERICAN INTERNATIONAL GROUP, INC.
 Financial Highlights
 (In thousands, except per share amounts)
 SIX MONTHS ENDED JUNE 30,
 1993 1992 Percent
 Change
 General Insurance Operations:
 Net Premiums Written $ 5,079,050 $4,627,420 9.8
 Net Premiums Earned 4,604,036 4,582,668 0.5
 Adjusted Underwriting Profit
 (Loss) 25,189 (15,860) --
 Net Investment Income 659,023 615,698 7.0
 Income before Realized Capital
 Gains 684,212 599,838 14.1
 Realized Capital Gains 40,836 39,899 --
 Operating Income $ 725,048 $ 639,737 13.3
 Loss Ratio 79.81 80.37
 Expense Ratio 19.78 20.06
 Combined Ratio 99.59 100.43
 Life Insurance Operations:
 Premium Income $ 2,696,221 $2,258,408 19.4
 Net Investment Income 716,863 623,276 15.0
 Income before Realized Capital
 Gains 344,181 295,195 16.6
 Realized Capital Gains 27,601 26,059 --
 Operating Income 371,782 321,254 15.7
 Financial Services Operating Income 185,805 145,460 27.7
 Agency and Service Fee Operating
 Income 32,273 26,527 21.7
 Equity in Income of Minority-Owned
 Reinsurance Operations 18,086 16,165 11.9
 Other Income (Deductions) - net (34,786) (36,429) --
 Foreign Exchange Gains (Losses) (1,622) 3,799 --
 Other Realized Capital Gains (Losses) (6,076) (11,406) --
 Income before Income Taxes and
 Cumulative Effect of Accounting
 Changes 1,290,510 1,105,107 16.8
 Income Taxes 333,650 277,821 --
 Income before Cumulative Effect of
 Accounting Changes 956,860 827,286 15.7
 Cumulative Effect of Accounting Changes (A):
 AIG -- 31,941 --
 Minority-Owned Reinsurance
 Operations 20,695 -- --
 Net Income $ 977,555 $859,227 13.8
 Per Share (B) (C):
 Income before Cumulative Effect of
 Accounting Changes $4.51 $3.89 15.9
 Cumulative Effect of Accounting Changes:
 AIG -- 0.15 --
 Minority-Owned Reinsurance
 Operations 0.10 -- --
 Net Income $4.61 $4.04 14.1
 Average Common Shares Outstanding (C) 211,604 211,917
 AMERICAN INTERNATIONAL GROUP, INC.
 Financial Highlights
 (In thousands, except per share amounts)
 THREE MONTHS ENDED JUNE 30,
 Percent
 1993 1992 Change
 General Insurance Operations:
 Net Premiums Written $ 2,635,240 $2,361,634 11.6
 Net Premiums Earned 2,366,448 2,277,475 3.9
 Adjusted Underwriting Profit (Loss) 4,055 (15,163) --
 Net Investment Income 328,367 306,761 7.0
 Income before Realized Capital Gains 332,422 291,598 14.0
 Realized Capital Gains 16,135 18,778 --
 Operating Income $ 348,557 $ 310,376 12.3
 Loss Ratio 79.41 80.68
 Expense Ratio 20.19 20.09
 Combined Ratio 99.60 100.77
 Life Insurance Operations:
 Premium Income $ 1,441,912 $1,192,360 20.9
 Net Investment Income 367,641 314,928 16.7
 Income before Realized Capital
 Gains 179,707 153,694 16.9
 Realized Capital Gains 14,511 11,920 --
 Operating Income 194,218 165,614 17.3
 Financial Services Operating Income 99,614 83,055 19.9
 Agency and Service Fee Operating Income 16,258 11,908 36.5
 Equity in Income of Minority-Owned
 Reinsurance Operations 9,199 8,010 14.8
 Other Income (Deductions) - net (15,274) (16,416) --
 Foreign Exchange Gains (Losses) 511 577 --
 Other Realized Capital Gains (Losses) (2,844) (4,167) --
 Income before Income Taxes and
 Cumulative Effect of Accounting
 Changes 650,239 558,957 16.3
 Income Taxes 168,605 139,374 --
 Income before Cumulative Effect of
 Accounting Changes 481,634 419,583 14.8
 Cumulative Effect of Accounting Changes (A):
 AIG -- -- --
 Minority-Owned Reinsurance Operations -- -- --
 Net Income $ 481,634 $ 419,583 14.8
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Date:Jul 29, 1993
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