Defendant Federal Reserve Document Production On AIG From Sept 2008 Heavy Redactions (Lawsuit #3)

From: (b) (4)
To: Patrick.M.Parkinson@frb.gov; terrence.checki@ny.frb.org; spence.hilton@ny.frb.org

Subject: Our biggest worry here
Date: 09/12/2008 07:10 AM
AIG traded up to 755 for 5 yr CDS---t the one that worries

our head of overall credit trading -- (b) (4) the most. (b) (4)
(b) (4)
(b) (4)
(b) (4)
BOG-- FOIA 10-251 --000001

From: Patrick M Parkinson
To: Brian Madigan
Subject: AIG
Date: 09/12/2008 09:10 AM
Sounds like they are getting nervous. Pat
BOG-- FOIA 10-251 --000002

From: Brian.F.Madigan@frb.gov
To: Patrick.M.Parkinson@frb.gov
Subject: Re: AIG
Date: 09/12/2008 09:30 AM
Do you have some text on this?
Patrick.M.Parkins
on@frb.gov
To
09/12/2008 09:10 "Brian Madigan"
AM <brian.f.madigan@frb.gov>
cc
Subject
AIG
Duplicate
BOG-- FOIA 10-251 --000003

To: Brian F Madigan
Subject: Re: AIG
Date: 09/12/2008 09:32 AM
No. TFG related on conference call. Firm is expecting downgrade, worried

about liquidity.
----- Original Message -----

From: Brian.F.Madigan
Sent: 09/12/2008 09:30 AM AST
To: Patrick Parkinson
Subject: Re: AIG
Duplicate
BOG-- FOIA 10-251 --000004

From: (b) (4)
To: Chris.Burke@ny.frb.org; william.dudley@ny.frb.org; gustavo.a.suarez@frb.gov
Subject: RE: I am getting a lot of questions from Investors about AIG
Date: 09/12/2008 10:13 AM
It kinda feels like the market is melting down again for financials. Govt RP now bid at
2.40/offered at 2.30.
_____________________________________________
From: (b) (4)
Sent: Friday, September 12, 2008 9:30 AM
To: 'Chris.Burke@ny.frb.org'; ' (william.dudley@ny.frb.org)'
Subject: I am getting a lot of questions from Investors about AIG
Importance: High
**Besides the repo market very sloppy today, I am getting investors coming in
asking me if AIG is having any trouble rolling their CP. Just fyi. Their stock is
getting hit hard this morning again I believe
Repo under huge upward pressure this morning due most likely to the LEH
situation. I am sure you saw the stops yesterday in the repos that generated a
huge spike in repo into the close yesterday, so starting out very high today
with market fears of funding. Just fyi
(b) (4)
BOG-- FOIA 10-251 --000005

From: Deborah P Bailey
To: William B English
Cc: Jon D Greenlee
Subject: Re: AIG
Date: 09/12/2008 12:00 PM
Bill, I passed your email on to Jon Greenlee. I am not sure but Jon may have some
folks working on something
▼ William B English/BOARD/FRS
William B
English/BOARD/FRS
To Deborah P Bailey/BOARD/FRS@BOARD
cc
09/12/2008 11:55 AM Subject AIG
Deborah-
Do you guys have an expert on AIG? I thought I would ask before

asking one of my folks to look into them, just to be sure we are not
duplicating work.
Thanks,
Bill E.
BOG-- FOIA 10-251 --000006

From: Jon D Greenlee
To: Deborah P Bailey
Cc: William B English
Subject: Re: AIG
Date: 09/12/2008 12:55 PM
Bill,
We don't have an expert on the company, but I do believe we have done some work
on their credit exposures. I will see what we have and share it with you.
Jon
Jon Greenlee
Associate Director
Board of Governors of the Federal Reserve System
Phone (202) 452-2962
▼ Deborah P Bailey/BOARD/FRS
Deborah P
Bailey/BOARD/FRS
To William B English/BOARD/FRS@BOARD
cc Jon D Greenlee/BOARD/FRS
09/12/2008 12:00 PM Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000007

To: Sabeth I Siddique
Subject: Fw: AIG
Date: 09/12/2008 12:58 PM
Anyone in your group know much about AIG? I imagine we've looked at some of
their credit exposures but not much else. Is there anything we can share?
Jon Greenlee
Associate Director
Phone (202) 452-2962
----- Forwarded by Jon D Greenlee/BOARD/FRS on 09/12/2008 12:57 PM -----
Deborah P
Bailey/BOARD/FRS
09/12/2008 12:00 PM Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000008

From: (b) (4)
Subject: RE: I am getting a lot of questions from Investors about AIG: Update
Date: 09/12/2008 01:05 PM
Investors are heading for the exits in CP on Aig, I am beeing asked to bid back
multiple pieces of Aig Funding CP from multiple investors. This is not going very
well.(Their stock is below $13 I believe)
Duplicate
BOG-- FOIA 10-251 --000009

From: Maria G Perozek
Subject: Re: AIG
Date: 09/12/2008 01:10 PM
Hi Bill--I have been completely swamped with forecast issues, so I am afraid I am

not going to be much help at the moment on recent developments at AIG. After my
memo goes out this afternoon, I will do some research and get back to you.
Best,
Maria
William B
English/BOARD/FRS
To Maria G Perozek/BOARD/FRS@BOARD
cc
09/12/2008 11:56 AM Subject AIG
Hi Maria-
What do you know about AIG? Have you produced memos on them
anytime recently? They appear to be under much more stress in the
past few days, and I would like to know more about them.
Thanks,
Bill E.
BOG-- FOIA 10-251 --000010

From: Gustavo A Suarez
To: JNellie Liang; Daniel M Covitz
Subject: Fw: I am getting a lot of questions from Investors about AIG: Update
Date: 09/12/2008 01:14 PM
(b) (4) reports that several investors are asking her to bid back on CP issued by
AIG.
----- Forwarded by Gustavo A Suarez/BOARD/FRS on 09/12/2008 01:13 PM -----
(b) (4)
To <Chris.Burke@ny.frb.org>,
<william.dudley@ny.frb.org>,
<gustavo.a.suarez@frb.gov>
09/12/2008 01:05 PM cc
Subject RE: I am getting a lot of questions from Investors
about AIG: Update
Investors are heading for the exits in CP on Aig, I am beeing asked to bid back
multiple pieces of Aig Funding CP from multiple investors. This is not going very
well.(Their stock is below $13 I believe)
Duplicate
BOG-- FOIA 10-251 --000011

From: JNellie Liang
To: Patrick Parkinson; Brian Madigan
Cc: Gustavo Suarez
Subject: Fw: I am getting a lot of questions from Investors about AIG: Update
Date: 09/12/2008 01:22 PM
Take this with a grain of salt, but is refle

--------------------------------------------------------------------------------
--Sent from my BlackBerry Wireless Handheld
▼ Gustavo A Suarez

Sent: 09/12/2008 01:14 PM EDT
To: JNellie Liang; Daniel Covitz
Subject: Fw: I am getting a lot of questions from Investors about AIG:
Update
(b) (4) reports that several investors are asking her to bid back on CP
issued by AIG.
Duplicate
BOG-- FOIA 10-251 --000012

To: JNellie Liang; Brian F Madigan
Cc: Gustavo A Suarez
Subject: Re: I am getting a lot of questions from Investors about AIG: Update
Date: 09/12/2008 01:23 PM
Consistent with other rumblings. Pat

From: JNellie.Liang
Sent: 09/12/2008 01:22 PM AST
To: Patrick Parkinson; Brian Madigan
Cc: Gustavo Suarez
Subject: Fw: I am getting a lot of questions from Investors about AIG:
Update
Duplicate
Duplicate
BOG-- FOIA 10-251 --000013

From: Patrick.M.Parkinson@frb.gov
To: brian.f.madigan@frb.gov; michael.s.gibson@frb.gov
Subject: AIG
Date: 09/12/2008 03:00 PM
Importance: High
Trish Mosser just called. AIG is coming to FRBNY this afternoon. Evidently
they have a huge hole and are worried about downgrades, liquidity problems.
Source of hole is credit derivatives. She will call later with details.
I may or may not be going to NY, perhaps later today but more likely
tomorrow morning. So I am going to point Trish in your direction.
Pat
BOG-- FOIA 10-251 --000014

From: Fabio M Natalucci
To: Roberto Perli
Cc: Fabio M Natalucci
Subject: AIG collateral posting in case of a downgrade--based on their Aug 6 10-Q
Date: 09/12/2008 04:20 PM
A significant portion of AIGFP’s guaranteed investment agreements (GIAs) and financial

derivative transactions include provisions that require AIGFP, upon a downgrade of AIG’s
long-term debt ratings, to post collateral or, with the consent of the counterparties, assign or
repay its positions or arrange a substitute guarantee of its obligations by an obligor with
higher debt ratings.
It is estimated that, as of the close of business on July 31, 2008, based on AIGFP’s

outstanding municipal GIAs and financial derivative transactions at that date, a
downgrade of AIG’s long-term senior debt ratings to ‘A1’ by Moody’s Investors Service
(Moody’s) and ‘A+’ by Standard & Poor’s, a division of The McGraw-Hill Companies,
Inc. (S&P), would permit counterparties to make additional calls for up to
approximately $13.3 billion of collateral, while a downgrade to ‘A2’ by Moody’s and ‘A’
by S&P would permit counterparties to call for approximately $1.2 billion of additional
collateral. If either of Moody’s or S&P downgraded AIG’s ratings to ‘A1’ or ‘A+’,
respectively, the estimated collateral call would be for up to approximately $10.5 billion,
while a downgrade to ‘A2’ or ‘A’, respectively, by either of the two rating agencies
would permit counterparties to call for up to approximately $1.1 billion of additional
collateral.
Furthermore, a downgrade of AIG’s long-term senior debt ratings to ‘A1’ by Moody’s

or to the same levels by both rating agencies would permit either AIG or the
counterparties to elect early termination of contracts resulting in payments of up to
approximately $4.6 billion, while a downgrade to ‘A2’ by Moody’s and ‘A’ by S&P
would permit either AIG or the counterparties to elect early termination of additional
contracts resulting in additional payments of up to approximately $800 million. AIGFP
believes that it is unlikely that certain of these counterparties would exercise their rights to
elect termination of their contracts given the substantial economic benefit that such
counterparties would forfeit upon termination.
The actual amount of collateral that AIGFP would be required to post to counterparties in the
event of such downgrades, or the aggregate amount of payments that AIG could be required
to make, depends on market conditions, the fair value of outstanding affected transactions
and other factors prevailing at the time of the downgrade. Additional obligations to post
collateral or the costs of assignment, repayment or alternative credit support would increase
the demands on AIG’s liquidity. Further downgrades could result in requirements for
substantial additional collateral, which could have a material adverse effect on AIG’s
liquidity.
BOG-- FOIA 10-251 --000015

From: Fabio M Natalucci
To: Roberto Perli
Subject: Bloomberg story on AIG
Date: 09/12/2008 04:23 PM
AIG May Announce Its Turnaround Plan Before Sept. 25 (Update2)
By Hugh Son and Shannon D. Harrington
Sept. 12 (Bloomberg) -- American International Group Inc., the largest U.S. insurer, may
accelerate plans to raise capital or sell assets after the shares plunged 42 percent this week,
said a person familiar with the company.
Chief Executive Officer Robert Willumstad may announce the turnaround plan before his
Sept. 25 deadline said the person, who declined to be named because the New York-based
insurer hasn't made an official statement. AIG may be able to raise $20 billion selling assets
including its consumer finance, reinsurance and plane-leasing units, according to analysts at
Citigroup Inc.
AIG shares slumped and the cost of insuring its debt rose to a record today on concern that
the company may be the next big U.S. financial firm after Lehman Brothers Holdings Inc. to
run short of capital. AIG spokesman Joe Norton declined to comment on the reorganization
plans.
`Ìt's a carbon-copy story for a lot of these guys that need capital,'' said Robert Bolton,
managing director for trading at Mendon Capital Advisors Corp. in Rochester, New York.
`Ìt's unprecedented that two storied franchises, Bear Stearns and Lehman, have taken on the
type of water they have, and now there are fears about another titan, AIG.''
AIG dropped $4.61, or 26 percent, to $12.94 at 3:29 p.m. in New York Stock Exchange
composite trading. The price of credit- default swaps, used as hedges against losses on bad
debt, approached distressed levels and traded higher than those for Lehman, the securities
firm that's fighting for survival.
Raising Capital
The insurer raised $20.3 billion in May by selling debt and equity, diluting the holdings of
long-time investors. It's ``very hard to predict'' if AIG will need more capital, Willumstad
said Aug. 7.
`Às distressed as they are, raising new capital could be extremely hard,'' said Tim Backshall,
chief strategist at Credit Derivatives Research LLC in Walnut Creek, California, today in an
e-mail.
BOG-- FOIA 10-251 --000016

The insurer disclosed in an Aug. 6 filing that a ratings cut may have `à material adverse
effect on AIG's liquidity.'' The company was forced to put up $16.5 billion in collateral
through July 31 for investors who bought protection from AIG through credit-default swaps.
The firm reported about $25 billion in writedowns in three previous quarters on the swaps.
The contracts backed $441 billion of assets as of June 30, including $57.8 billion in securities
tied to subprime mortgages.
Credit-Default Swaps
Most of the valuation declines on the swaps will reverse and AIG may have to pay $8.5
billion on the contracts in a worst-case scenario, the company said Aug. 7.
American General Finance, AIG's consumer lender, could fetch more than $6 billion if the
unit sold for twice its book value. AIG Investments could sell for more than $3 billion if it
sold for 2.5 percent of clients' assets under management. The stake in reinsurer Transatlantic
Holdings Inc. is worth about $2.4 billion, based on the Sept. 10 share price.
Bank of America Corp. analyst Alain Karaoglan said Willumstad should reconsider the
decision to keep its aircraft- leasing unit, which could sell for $7 billion to $14 billion.
BOG-- FOIA 10-251 --000017

From: (b) (4)
Subject: AIG: Update
Date: 09/12/2008 05:22 PM
I am sure you saw, S&P put Aig ratings on NEG WATCH for downgrade. I think this
along with their Stock/CDS price action today will shut them out of CP on Monday
given the investor nervousness I saw today. News sources saying AIG may have
some conference call Monday, so we will see what happens.
(b) (4)
BOG-- FOIA 10-251 --000018

To: JNellie Liang; Daniel M Covitz; Patrick M Parkinson
Subject: Fw: AIG: Update
Date: 09/12/2008 05:25 PM
(b) (4)
To <Chris.Burke@ny.frb.org>,
<gustavo.a.suarez@frb.gov>
09/12/2008 05:22 PM cc
Subject AIG: Update
I am sure you saw, S&P put Aig ratings on NEG WATCH for downgrade. I think this
along with their Stock/CDS price action today will shut them out of CP on Monday
given the investor nervousness I saw today. News sources saying AIG may have
some conference call Monday, so we will see what happens.
(b) (4)
BOG-- FOIA 10-251 --000019

To: Patrick M Parkinson
Cc: Brian F Madigan; Scott Alvarez; Jon D Greenlee
Subject: Re: AIG
Date: 09/12/2008 05:35 PM
There is a big concern. I did tell the Chairman and vice chairman because the
President of AIG said that he was planning to call the Chairman and vice chairman
re: 13-3 loan. We are(b) working on background of the Co. AIG is under the OTS. The
holding company is a The thrift is The ratings on this was May 08.
(8) (b) (8)
Brian, the vice chair asked that you include me on the Saturday call? Thanks
--------------------------
Sent from the Blackberry of Deborah Bailey
▼ Patrick M Parkinson

Sent: 09/12/2008 05:18 PM EDT
To: Deborah Bailey
Subject: Re: AIG
I've heard. One FRBNY staffer thinks it's in worse shape than LB.
Brian Madigan said there is concern about its ability to make payments
on Monday.
Pat
Deborah P
Bailey/BOARD/FRS
To Patrick M Parkinson/BOARD/FRS@BOARD
cc
09/12/2008 05:16 PM Subject AIG
NY Fed talked with them. It's not good. I am on the call but call me
when you are done.
--------------------------
BOG-- FOIA 10-251 --000020

From: Michael S Gibson
Subject: Re: AIG
Date: 09/12/2008 05:35 PM
Are you still waiting for Trish to call? If it is important for me to stay here to talk to
Trish, I can stay, but I do have some things to take care of at home tonight.
Just let me know.
FYI, I looked at AIG's Q2 earnings presentation. They have taken cumulative MTM
writedowns of $25 billion on super senior ABS CDOs ($80 billion notional). They
have posted $16.5 billion of collateral. Their CSAs do have rating-based triggers for
collateral. For them as for others, MTM writedowns will become realized losses as
the CDOs liquidate, which (market-wide) is happening gradually.
MG
▼ Patrick.M.Parkinson@frb.gov
Patrick.M.Parkinson@frb.gov
To brian.f.madigan@frb.gov,
michael.s.gibson@frb.gov
09/12/2008 03:00 PM cc
Subject AIG
Duplicate
BOG-- FOIA 10-251 --000021

To: Michael S Gibson
Subject: Re: AIG
Date: 09/12/2008 05:38 PM
You will get an email later. You probably will be invited to a meeting tomorrow.
They are in terrible shape, possibly worse than Lehman! The losses are at the
derivative products sub. Pat
▼ Michael S Gibson/Board/FRS
Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS cc
Subject
Re: AIG
09/12/2008 05:35 PM
Duplicate
BOG-- FOIA 10-251 --000022

From: Lyle Kumasaka
To: Brian F Madigan; James A Clouse; William B English; William R Nelson; Roberto Perli
Subject: AIG FSB
Date: 09/12/2008 05:39 PM
RESTRICTED FR
AIG FSB is a federally chartered thrift headquartered in Wilmington DE (3rd Dist).

Total Assets: $1.3 billion (June 2008)
CAMELS comp. (b) (8)
(b) (8)
Has borrowing docs but no collateral.

DLOD cap: $57 mil.
BOG-- FOIA 10-251 --000023

From: Patricia Mosser
To: Timothy Geithner; Brian F Madigan; Patrick M Parkinson; Jon D Greenlee; Deborah P Bailey; Arthur Angulo;
William Dudley; William Rutledge; Sarah Dahlgren; Brian Peters; Meg McConnell; Thomas Baxter; Michael S
Gibson
Cc: jim.mahoney@ny.frb.org
Subject: AIG meeting this afternoon
Date: 09/12/2008 05:44 PM
Attachments: AIG Meeting Notes.doc
Restricted FR
2
AIG Meeting Notes
September 12, 2008
AIG – Jacob Frenkel (Vice Chairman), Steve Bensinger (CFO), David Herzog (SVP
& Comptroller), Robert Gender (VP & Treasurer), Alan Pryor (EVP – Financial
Services Division)
FRBNY – Trish Mosser, Jim Mahoney, Bill Dudley
AIG is facing serious liquidity issues that threaten its survival viability.
There are potential credit rating agency downgrades. Moody’s Committee meets on
Monday September 15 (currently rated AA3, downgraded at least one notch)… S&P
already has AIG on negative watch (as of today)… Fitch already has AIG on
negative watch.
Rating triggers:
GICs are issued out of AIG-Financial Products (AIG-FP), insured by the holding
company.
downgrade by 1 rating agency leads to $10B in collateral calls, plus an additional
$4B-$5B in portfolio obligations that are puttable if downgraded (total of $15B in
liquidity needs)
downgrade by 2 rating agencies – additional $3B in liquidity needs
If downgraded, they must post half of the additional collateral within 2 days, and
the other half in 10 days.
Markets are also punishing AIG. Stock prices are off about 40% today, and CDS is
traded at about 1400 bp (up from about 10 bp eighteen months ago).
Some banks are already pulling away; some banks are even turning down AIG in the
secured (repo) borrowing markets
AIG is having problems rolling its commercial paper (CP). $2.5B in CP matured
today, but they were able to roll only $1.1B, the remaining $1.4B was funded out of
the parent.
AIG has a total of about $15B in CP, which has backstop (backup lines
of credit) from a consortium of banks; AIG may have to draw on lines
on Monday, which is a material event and so will become publicly
known and have negative implications.
AIG also has ABCP facilities of about $5B, and these have no backup
lines
BOG-- FOIA 10-251 --000024

AIG’s repo book is all investment grade, mostly structured mortgage products….
Things that have, in the past, been used as repo collateral... but the combination of
being perceived as a weak counterparty and risky, illiquid collateral is resulting in
counterparties stepping away….
Securities lending (mostly out of the insurance companies) – about $69B in liabilities,
and the holding company has only enough cash to fund ½ of that, if the sec lending
counterparties turn away from the AIG name.
Mobility of liquidity – most cash within the organization is ‘trapped’ in regulated

entities and is not freely transferable to AIG holding company or AIG Financial
Products (the derivatives and trading sub) for its liquidity needs.
Today, the holding company started with $9B in liquidity, used $1.4 for CP, but
was able to upstream about $1.4B in ‘dividends’ from subs up to holding company,
but little ability, in general, to use subs to upstream liquidity to holding co or its non-
regulated subs.
Bottom line: Treasurer estimates that parent and AIG FS sub have 5-10 days before
they are out of liquidity.
Plans to address liquidity stress? AIG is aggressively pursuing:

Asset sales – but many viable assets to sell have distressed and illiquid markets
into which to sell
Equity issuance – not viable at this time – 3 months ago, AIG raised $20B in
capital. It is all gone.
Holding company has about $12B in ‘Fed-eligible’ assets (that is, PDCF
collateral… note, however, this does not include the restriction on assets that have
‘available prices’)
The various insurance subs have very large quantity of high quality assets, but the
restrictions on pledging those are very unclear.
Unwinding in event of bankruptcy is likely to be very messy, because derivatives

book is large and complex $2.7 Trillion, largely of very long-term structure products.
$1 Trillion is concentrated in 12 large counterparties. Book is very far from balanced,
although they could not give a MTM value. One of the challenges they are already
facing is very aggressive marks from counterparties and strategic unwinding of “in
the money” positions, and this will likely accelerate in coming days adding to the cash
drain. Their super senior CDO book is about $80 bn and at present they have
approximately $19 billion in collateral posted against it.
Access to Fed facilities:

They have what they describe as a very small thrift, and so limited ability to borrow
from DW. Recently they drew up a plan to become a primary dealer over a 6-12
month period, but obviously do not have the time to implement that plan. They
explicitly asked about how to obtain an IPC 13-3 loan. They are very willing to open
their books to us, and give us a better sense of their risk profile, the complexity of
their book and detailed liquidity profile as soon as possible (ie this weekend.)
BOG-- FOIA 10-251 --000025

BOG-- FOIA 10-251 --000026
Restricted FR
AIG Meeting Notes

September 12, 2008
AIG – Jacob Frenkel (Vice Chairman), Steve Bensinger (CFO), David Herzog (SVP &
Comptroller), Robert Gender (VP & Treasurer), Alan Pryor (EVP – Financial
Services Division)
FRBNY – Trish Mosser, Jim Mahoney, Bill Dudley
AIG is facing serious liquidity issues that threaten its survival viability.
There are potential credit rating agency downgrades. Moody’s Committee meets on
Monday September 15 (currently rated AA3, downgraded at least one notch)…
S&P already has AIG on negative watch (as of today)… Fitch already has AIG
on negative watch.
Rating triggers:
GICs are issued out of AIG-Financial Products (AIG-FP), insured by the holding
company.
- downgrade by 1 rating agency leads to $10B in collateral calls, plus an
additional $4B-$5B in portfolio obligations that are puttable if downgraded
(total of $15B in liquidity needs)
- downgrade by 2 rating agencies – additional $3B in liquidity needs
- If downgraded, they must post half of the additional collateral within 2 days,
and the other half in 10 days.
Markets are also punishing AIG. Stock prices are off about 40% today, and CDS is
traded at about 1400 bp (up from about 10 bp eighteen months ago).
Some banks are already pulling away; some banks are even turning down AIG in the
secured (repo) borrowing markets
AIG is having problems rolling its commercial paper (CP). $2.5B in CP matured today,
but they were able to roll only $1.1B, the remaining $1.4B was funded out of the
parent.
AIG has a total of about $15B in CP, which has backstop (backup lines of
credit) from a consortium of banks; AIG may have to draw on lines
on Monday, which is a material event and so will become publicly
known and have negative implications.
AIG also has ABCP facilities of about $5B, and these have no backup
lines
AIG’s repo book is all investment grade, mostly structured mortgage products…. Things
that have, in the past, been used as repo collateral... but the combination of being
perceived as a weak counterparty and risky, illiquid collateral is resulting in
counterparties stepping away….
1
BOG-- FOIA 10-251 --000027
Restricted FR
Securities lending (mostly out of the insurance companies) – about $69B in liabilities,
and the holding company has only enough cash to fund ½ of that, if the sec
lending counterparties turn away from the AIG name.
Mobility of liquidity – most cash within the organization is ‘trapped’ in regulated entities
and is not freely transferable to AIG holding company or AIG Financial Products
(the derivatives and trading sub) for its liquidity needs.
Today, the holding company started with $9B in liquidity, used $1.4 for CP, but
was able to upstream about $1.4B in ‘dividends’ from subs up to holding
company, but little ability, in general, to use subs to upstream liquidity to holding
co or its non-regulated subs.
Bottom line: Treasurer estimates that parent and AIG FS sub have 5-10 days before they
are out of liquidity.
Plans to address liquidity stress? AIG is aggressively pursuing:

- Asset sales – but many viable assets to sell have distressed and illiquid
markets into which to sell
- Equity issuance – not viable at this time – 3 months ago, AIG raised $20B in
capital. It is all gone.
- Holding company has about $12B in ‘Fed-eligible’ assets (that is, PDCF
collateral… note, however, this does not include the restriction on assets that
have ‘available prices’)
- The various insurance subs have very large quantity of high quality assets, but
the restrictions on pledging those are very unclear.
Unwinding in event of bankruptcy is likely to be very messy, because derivatives book is

large and complex $2.7 Trillion, largely of very long-term structure products. $1
Trillion is concentrated in 12 large counterparties. Book is very far from
balanced, although they could not give a MTM value. One of the challenges they
are already facing is very aggressive marks from counterparties and strategic
unwinding of “in the money” positions, and this will likely accelerate in coming
days adding to the cash drain. Their super senior CDO book is about $80 bn and
at present they have approximately $19 billion in collateral posted against it.
Access to Fed facilities:

They have what they describe as a very small thrift, and so limited ability to borrow from
DW. Recently they drew up a plan to become a primary dealer over a 6-12
month period, but obviously do not have the time to implement that plan. They
explicitly asked about how to obtain an IPC 13-3 loan. They are very willing to
open their books to us, and give us a better sense of their risk profile, the
complexity of their book and detailed liquidity profile as soon as possible (ie this
weekend.)
2
BOG-- FOIA 10-251 --000028
To: Michael S Gibson; jim.mahoney@ny.frb.org; Jon D Greenlee
Cc: Patrick M Parkinson
Subject: followup with AIG
Date: 09/12/2008 05:47 PM
Jon and Mike,
Given how dire the situation with AIG is, Jim and I thought we should probably
follow up to get more information on their risk profile, etc. sometime tomorrow.
They will make available to us the appropriate people. Sorry to wreck your
weekend, but what times would work for you?? (Jim and I have given up --- we
know we are here for the duration.)
Thanks
Trish
BOG-- FOIA 10-251 --000029

To: JNellie.Liang@frb.gov
Subject: Re: I may need some help AIG
Date: 09/12/2008 06:22 PM
Nellie,
Sorry I missed your call. I gathered some basic facts about unsecured CP by AIG and its 3
sponsored ABCP programs and gave them to Dan and Bill English.
If there is a change of plans. I can be reached by email over the weekend or at (b) (6) .
Gustavo
▼ JNellie.Liang@frb.gov
JNellie.Liang@frb.gov
To Gustavo.A.Suarez@frb.gov
cc
09/12/2008 06:04 PM
Subject Re: I may need some help AIG
Thanks, I think we're free for the weekend. Monday might be hectic.

Gustavo.A.Suarez@

frb.gov

To
09/12/2008 05:24
PM
cc

Subject
Re: I may need some help
AIG

BOG-- FOIA 10-251 --000030

Happy to help. I will be around about one more hour and will be checking
email from home after that.


09/12/2008 05:22 PM
To
"Gustavo
Suarez"

<Gustavo.A.Suarez@frb.gov>

cc

Subject
I may need some help
AIG

What time are you leaving?

-------------------------------------------------------------------------
-------
BOG-- FOIA 10-251 --000031

To: Jon D Greenlee
Cc: Ms. Deborah P Bailey; Jim Mahoney; Michael S Gibson; Patrick M Parkinson
Subject: Re: followup with AIG
Date: 09/12/2008 06:24 PM
Situation is a mess -- AIG is open to having someone go over/call in tonight to
start the process. Any chance you could call in at about 8 pm or so tonight?
▼ Jon D Greenlee/BOARD/FRS@BOARD
Jon D
Greenlee/BOARD/FRS@BOARD
To Michael S Gibson/BOARD/FRS@BOARD,
Patricia Mosser/NY/FRS@FRS
cc Jim Mahoney/NY/FRS@FRS, Patrick M
09/12/2008 06:03 PM Parkinson/BOARD/FRS@BOARD, "Ms.
Deborah P Bailey"
<Deborah.P.Bailey@FRB.Gov>
Subject
Re: followup with AIG
I have an 11 AM call and one at 1 PM, but I can miss those if

necessary.
Thanks
Jon
--------------------------
Sent from my BlackBerry Wireless Handheld
▼ Michael S Gibson

Sent: 09/12/2008 05:49 PM EDT
To: Patricia Mosser
Cc: Jim Mahoney; Jon Greenlee; Patrick Parkinson
Hi Trish,
Tomorrow morning is fine for me. Afternoon is not as good but I could make time
for a call.
Mike
▼ Patricia Mosser/NY/FRS@FRS
Duplicate
BOG-- FOIA 10-251 --000032

From: William R Nelson
To: Deborah P Bailey; Brian F Madigan; James A Clouse; Daniel M Covitz; William B English; Gustavo A Suarez
Subject: some additional info on AIG
Date: 09/12/2008 06:24 PM
Attachments: aig moodys.pdf
aig Individual Firm Information.htm
Moody's report is very recent (mid August), so may be useful background.
Here is the important instution webpage from MFST's website. It should also be
available on shared umbrella group cite, but I don't know exactly where. I'm not
sure if this will actually be readable.
this is the link, but Deborah, you will not be able to get to it, I think.
http://www.rsma.frb.gov/dma/fst/SR/Restricted/aigsum.html
--Bill
Email: william.r.nelson@frb.gov
Office: 202-452-3579
Blackberry: 202-725-3612
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000033

(b) (4)
BOG-- FOIA 10-251 --000034

(b) (4)
BOG-- FOIA 10-251 --000035

(b) (4)
BOG-- FOIA 10-251 --000036

(b) (4)
BOG-- FOIA 10-251 --000037

(b) (4)
BOG-- FOIA 10-251 --000038

(b) (4)
BOG-- FOIA 10-251 --000039

aig: Individual Firm Information
MFST | Important Institutions

(b) (4)
BOG-- FOIA 10-251 --000040
file:///L|/2010/251/Documents/aig%20Individual%20Firm%20Information htm[10/25/2010 5:08:20 PM]

a (b) (4)
BOG-- FOIA 10-251 --000041

a
(b) (4)
BOG-- FOIA 10-251 --000042

To: Patricia Mosser
Cc: Deborah P Bailey; Jim Mahoney; Michael S Gibson; Patrick M Parkinson
Date: 09/12/2008 06:26 PM
Trish,
I am available.
Jon
--------------------------
▼ Patricia Mosser

Sent: 09/12/2008 06:27 PM EDT
To: Jon Greenlee
Cc: Deborah Bailey; Jim Mahoney; Michael Gibson; Patrick Parkinson
Situation is a mess -- AIG is open to having someone go over/call in
tonight to start the process. Any chance you could call in at about 8
pm or so tonight?
Duplicate
BOG-- FOIA 10-251 --000043

To: (b) (6) Donald L Kohn; Randall S Kroszner; Kevin Warsh; Elizabeth A Duke
Cc: Scott Alvarez; Roger Cole
Subject: Fw: AIG meeting this afternoon
Date: 09/12/2008 06:31 PM
The consolidated supervisor is OTS. The holding company is rated (b) (8) the thrift a
(b) (8
and a trust company Talking to the OTS now....

(b) (8)
(b) (8)
(b) (8)
----- Forwarded by Deborah P Bailey/BOARD/FRS on 09/12/2008 06:06 PM -----
Patricia
Mosser/NY/FRS@FRS
To Timothy Geithner/NY/FRS@FRS, Brian F
Madigan/BOARD/FRS@BOARD, Patrick M
Parkinson/BOARD/FRS@BOARD, Jon D
09/12/2008 05:44 PM Greenlee/BOARD/FRS@BOARD, Deborah P
Bailey/BOARD/FRS@BOARD, Arthur Angulo/NY/FRS,
William Dudley/NY/FRS, William
Rutledge/NY/FRS@FRS@NY, Sarah Dahlgren/NY/FRS,
Brian Peters/NY/FRS, Meg McConnell/NY/FRS@FRS,
Thomas Baxter/NY/FRS, Michael S
Gibson/BOARD/FRS@BOARD
cc jim.mahoney@ny.frb.org
Subject AIG meeting this afternoon
Duplicate
BOG-- FOIA 10-251 --000044

From: Brian F Madigan
To: James A Clouse; William B English; William R Nelson; Richard Perl; Daniel M Covitz; Gustavo A Suarez
Cc: Brian F Madigan
Subject: AIG
Date: 09/12/2008 06:33 PM
Restricted Controlled (FR)

----- Forwarded by Brian F Madigan/BOARD/FRS on 09/12/2008 06:31 PM -----
Patricia
Mosser/NY/FRS@FRS
Restricted FR
2
AIG Meeting Notes
September 12, 2008
Duplicate
BOG-- FOIA 10-251 --000045

To: jim.mahoney@ny.frb.org; Alejandro LaTorre; Catherine Voigts; Jon D Greenlee; Paul Whynott; Michael S Gibson
Cc: Brian Peters; Deborah P Bailey
Subject: AIG
Date: 09/12/2008 06:43 PM
working on getting hold of the right people -- risk managers, liquidity/Treasury guys
and derivatives senior guys in London and Connecticut -- but are pretty sure they
can do this tonight at 8 pm. Some will be on site and some will call in. Jacob will
be getting back to me with confirmation shortly. Will forward as soon I hear from
them..
BOG-- FOIA 10-251 --000046

To: Catherine Voigts
Cc: Alejandro LaTorre; Brian Peters; Deborah P Bailey; Jim Mahoney; Jon D Greenlee; Michael S Gibson; Paul
Whynott
Subject: Re: AIG
Date: 09/12/2008 07:00 PM
We are on for 8 pm at AIG. I will send names over so they can let you in.
Hosts of meeting are:

Jacob Frenkel, Vice Chm
Steven Bensinger, Vice Chm, AIG financial services, and CFO
Call-in information:
1-866-703-9405
code: 963870
▼ Catherine Voigts/NY/FRS
Catherine
Voigts/NY/FRS
To Patricia Mosser/NY/FRS@FRS, Jim
Mahoney/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS, Jon D
09/12/2008 06:52 PM Greenlee/BOARD/FRS@BOARD, Paul
Whynott/NY/FRS@FRS, Michael S
cc Brian Peters/NY/FRS@FRS, Deborah P
Bailey/BOARD/FRS@BOARD
Subject
Re: AIG
Pat
Coming in from CT _ shall I go ahead and commit to gettimg car
service and head in?
Cathy
-------------------------
Sent from my BlackBerry
917-208-0504
▼ Patricia Mosser

Sent: 09/12/2008 06:47 PM EDT
To: Jim Mahoney; Alejandro LaTorre/NY/FRS@FRS@NY; Catherine
Voigts; Jon Greenlee; Paul Whynott; Michael Gibson
Cc: Brian Peters; Deborah Bailey
Duplicate
BOG-- FOIA 10-251 --000047

To: Catherine Voigts
Cc: Alejandro LaTorre; Brian Peters; Deborah P Bailey; Jim Mahoney; Jon D Greenlee; Michael S Gibson; Paul
Whynott
Subject: Re: AIG
Date: 09/12/2008 07:01 PM
Meeting is at AIG, 70 Pine Street.
▼ Catherine Voigts/NY/FRS
Duplicate
BOG-- FOIA 10-251 --000048

Subject: Fw: AIG
Date: 09/12/2008 09:44 PM
What can I do to help at this point. I called Brian an hour ago and he was on a
conference call. Do you know what that was about?
Also, do you think he meant to send this to Richard Perl, or did he just perhaps
mistype "perli"? I was thinking of sending it to Robero.
bn
Office: 202-452-3579
Mobile: 703-340-4542
----- Forwarded by William R Nelson/BOARD/FRS on 09/12/2008 09:43 PM -----
Brian F
Madigan/BOARD/FRS
To James A Clouse/BOARD/FRS@BOARD, William B
English/BOARD/FRS@BOARD, William R
Nelson/BOARD/FRS@BOARD, Richard
09/12/2008 06:33 PM Perl/NY/FRS@FRS, Daniel M
Covitz/BOARD/FRS@BOARD, Gustavo A
Suarez/BOARD/FRS@BOARD
cc Brian F Madigan/BOARD/FRS@BOARD
Subject AIG

Patricia
Mosser/NY/FRS@FRS
Restricted FR
2
AIG Meeting Notes Meeting Notes are Duplicates
BOG-- FOIA 10-251 --000049

Subject: AIG Call
Date: 09/12/2008 09:52 PM
Not a lot new from Trish's note. Some more details on counterparties and
derivatives. They expect a ratings downgrade early next week, they plan to draw on
their backup lines which will give them enough liquidity to get them to the 26th or
29th. They expect if counterparties begin to pull away, it will happen quickly and
they could be run out of liquidity in a couple of days. Counterparties are pulling
away and they can't add borrowing capacity.
Trapped liquidity is a big issue. They have spoken with NY State insurance
commissioner about ways to get money out of insurance sub. They are
investigating, but cash is there to protect policy holders. Probably only feasible if
Fed lends to isnurance sub and they can move it to the HC (can't repo). They have
some capacity to move cash out, but only about $3 billion or so, but subs don't have
cash and are having trouble selling assets.
$68 billion in Sec Lending business - worry is about rolling it over. Business is in the
insurance sub referenced above. They can't sustain a large amount of withdrawals.
There isn't really a contingency plan. Pvt equity was discussed (due dil starting
tomorrow), sale of businesses, etc. - would need bridge financing.
They are a large issuer of annuities that can be put back. Could be as much as over
$100 billion.
They have ops overseas that could be afected - UK and Japan, but they also own
banks in Poland, Hong Kong, and other locations.
Derivatives book is huge, they sponsor some ETFs (commodities) and they have a lot
of counterparties. Most worried about behavior of counterparties and whether there
could be an acceleration of payments without netting. Concentration is in 12 major
internationally active banks that are the most active in the derivative market.
They are a member of CLS but a significant amount of their business is not done
through CLS.
FRBNY is getting the detailed reports.
Brian Madigan was on the call as well.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000050

Subject: AIG
Date: 09/12/2008 10:55 PM
We (NY and Board staff) had a conf call with AIG this evening. The situation seems
very serious. I will be filling Don in shortly. Board staff will be meeting at 8 a.m.
and then briefing the Chairman.
BOG-- FOIA 10-251 --000051

To: Roberto Perli
Subject: Fw: AIG
Date: 09/12/2008 11:34 PM
I'm sure Brian meant to send this to you and not Richard Perl.
What should we do? If AIG doesn't have collateral they can pledge to us, I just
don't think we can lend. It seems like it would have to be the Treasury. If we think
the entity is insolvent, can you think of anyway to make the failure more orderly?
Bill
Office: 202-452-3579
Mobile: 703-340-4542
Brian F
Madigan/BOARD/FRS
Nelson/BOARD/FRS@BOARD, Richard
09/12/2008 06:33 PM Perl/NY/FRS@FRS, Daniel M
Covitz/BOARD/FRS@BOARD, Gustavo A
Subject AIG

Patricia
Mosser/NY/FRS@FRS
Restricted FR
2
AIG Meeting Notes
Meeting Notes are Duplicates
BOG-- FOIA 10-251 --000052
From: Meg.McConnell@ny.frb.org
To: Kevin Warsh
Subject: Fw: Update on AIG
Date: 09/12/2008 11:52 PM
Fyi, in case today wasn't depressing enough...

--------------------------
Margaret M. McConnell
Federal Reserve Bank of New York
212-720-8773

From: Alejandro LaTorre
Sent: 09/12/2008 11:48 PM EDT
To: Christine Cumming; Timothy Geithner; William Dudley; William
Rutledge; Arthur Angulo; Brian Peters; Meg McConnell; Dianne Dobbeck;
Michael Nelson; Sandy Krieger; Michael Silva
Cc: Patricia Mosser; Catherine Voigts; Paul Whynott; Jim Mahoney
Subject: Update on AIG
We met with senior executives at AIG to discuss both their liquidity and
risk exposure situation. These included the CEO, CFO, General Counsel,
Treasurer and many others. Below are the important highlights ... Scott
Alvarez, Deborah Bailey, Jim Clouse, Mike Gibson and Brian Madigan from the
BoG also participated.
The key takeaway is that they are potentially facing a severe run on their
liquidity over the course of the next several (approx. 10) days if they are
downgraded by Moodys and S&P early next week. They anticipate downgrades
could happen as early as Monday. Their risk exposures are concentrated
among the 12 largest international banks (both U.S. and European) across a
wide array of product types (bank lines, derivatives, securities lending,
etc.) meaning their could be significant counterparty losses to those
firms in the event of AIG's failure. They estimate that they might have
to pay out $18.6B across the firm over the course of next week if they were
downgraded.
I. Liquidity
Breakdown of the $18.6B is:

Failed rolls on ABCP: $4.7B
Collateral posting on Muni GICs: $6B
Collateral posting on Structured Lease GICs: $3B
Collateral posting in derivatives contracts: $5B
As of close of business today, they have $8B in cash at the holding

company. They are experiencing significant difficulties in rolling their
programs and have used some of their holding company cash to pay down the
rolls. Their CP lines are backstopped by banks and if they were to draw
down, this would mean banks have to fund $15B in credit. They expressed
concern that banks might object to fund and take legal recourse to prevent
from doing so; or more likely they would restrict credit on other
exposures (e.g., trading lines). They also have $4.7B in ABCP programs
which are not backstopped. They have enough liquidity to last until Sept.
26th.
Outside of the holding co., the insurance subs have about $68B in
securities lending liabilities to the 12 largest firms. Program is
managed by the holding company (AIG Financial Products). In principle they
could use these assets for repo: in practice they do not believe that repo
of assets is viable b/c the assets are mostly non-agency mortgages and not
very desirable. They have lending facilities from the insurance
subsidiary to the holding company of $4.9B. They discussed with NYSID
Superintendent Dinallo whether they could free up liquidity in excess of
the $4.9B to the holding co. Some of the subs have large muni and
corporate portfolios that would have to be sold to free up liquidity,
meaning not all have excess liquidity. They suggested that Dinallo was
amenable to freeing up more liquidity.
BOG-- FOIA 10-251 --000053

They have so far made about $1B in collateral postings on derivatives over
the past week; 1 bank has also cut down their overdraft lines limiting
their ability to move funds across legal entities.
They have no concrete plans to generate near-term liquidity and longer-term

plans in their early stages. These longer term plans include a private
equity capital raise coupled with asset sales. Interested parties would
be performing due diligence starting tomorrow and into sunday.
They are also large issuers of annuities and have $11B of contingent
exposure in their domestic retirement services business. These are retail
but run by large sponsors who could encourage accounts to put back the
annuities in exchange for cash if they lose confidence in AIG. These
sponsors are U.S. banks who have exposure elsewhere. This could be on
top of the $18B payout above. They have similar exposures in Japan but
could not quantify the size.
They also have a sterling-denominated money market account of $10B and an

exchange traded fund in commodities with $3B (run by a sponsor) in
liquidity that could also face a run if there is a loss of confidence
II. Risk Exposure
$2.7 trillion in notional derivatives exposure across all books across 12

major dealers.
Commodities: index book of $25B; swaps on futures contracts where they are
long futures contracts to hedge; post variation margin of approx. $2B to
NYMEX; also trade options on indices both plain vanilla and structured.
Also have positions in precious and industrial metals.
CDS: Mostly ABS CDO (not pay as you go, but accelerate at default); $42B
High Grade; $60B Mezz.; $20B in CMBS CDOs. Underlying consists mostly of
RMBS 2005 vintage across ratings. Material net notionals of $305B in
mortgage and corporate exposures combined. Investment Grade Corp.
arbitrage another $55B; $1.5trillion of exposure to European banks through
balance sheet CDOs.
IR derivatives: USD/EUR/Yen denominated. $3B-$4B in size. Very little

negative convexity; long long-dated volatility, short short-dated
volatility; Long american exercise, short european exercise.
FX: they have prime brokerage of $30B in volumes and they clear through
CLS.
International Leasing Corp; commercial aircraft leasing to over 140

airlines of $50B; rolling CP has been difficult.
Also have smaller consumer finance companies and banks across the world
......
Jim, Trish, Paul, Cathy: if I've missed something or mischaracterized

something, let us know.
Regards,
Alex
BOG-- FOIA 10-251 --000054

From: William B English
To: Brian F Madigan
Cc: James A Clouse; Roberto Perli; William B English; William R Nelson
Subject: Background on AIG
Date: 09/13/2008 02:24 AM
Attachments: AIG background.pdf
Brian-
Attached is the promised memo. I found very little on the derivatives activities of
AIG, which is frustrating. They don't seem to say much in the 10-Ks/10-Qs. I will
check again in the am.
Thanks,
Bill E.
BOG-- FOIA 10-251 --000055

(b) (5)
BOG-- FOIA 10-251 --000056

(b) (5)
(b) (5)
BOG-- FOIA 10-251 --000057

(b) (5)
(b) (5)
BOG-- FOIA 10-251 --000058

American International Group, Inc. and Subsidiaries
Part I – FINANCIAL INFORMATION

ITEM 1. Financial Statements (unaudited)
CONSOLIDATED BALANCE SHEET
(in millions) (unaudited)

June 30, December 31,
2008 2007
Assets:
Investments and Financial Services assets:
Fixed maturity securities:
Bonds available for sale, at fair value (amortized cost: 2008 – $400,052; 2007 –
$393,170) $ 393,316 $ 397,372
Bonds held to maturity, at amortized cost (fair value: 2008 – $21,809; 2007 – $22,157) 21,632 21,581
Bond trading securities, at fair value 8,801 9,982
Equity securities:
Common stocks available for sale, at fair value (cost: 2008 – $13,490; 2007 – $12,588) 17,306 17,900
Common and preferred stocks trading, at fair value 22,514 21,376
Preferred stocks available for sale, at fair value (cost: 2008 – $2,596; 2007 – $2,600) 2,496 2,370
Mortgage and other loans receivable, net of allowance (2008 – $99; 2007 – $77) (held for
sale: 2008 – $30; 2007 – $377 (amount measured at fair value: 2008 – $745) 34,384 33,727
Financial Services assets:
Flight equipment primarily under operating leases, net of accumulated depreciation
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
Securities available for sale, at fair value (cost: 2008 – $1,246; 2007 – $40,157) 1,205 40,305
Trading securities, at fair value 35,170 4,197
Spot commodities, at fair value 90 238
Unrealized gain on swaps, options and forward transactions, at fair value 11,548 12,318
Trade receivables 2,294 672
Securities purchased under agreements to resell, at fair value in 2008 16,597 20,950
Finance receivables, net of allowance (2008 – $1,133; 2007 – $878) (held for sale:
2008 – $36; 2007 – $233) 33,311 31,234
Securities lending invested collateral, at fair value (cost: 2008 – $67,758; 2007 – $80,641) 59,530 75,662
Other invested assets (amount measured at fair value: 2008 – $22,099; 2007 – $20,827) 62,029 58,823
Short-term investments (amount measured at fair value: 2008 – $24,167) 69,492 51,351
Total Investments and Financial Services assets 835,602 842,042
Cash 2,229 2,284
Investment income due and accrued 6,614 6,587
Premiums and insurance balances receivable, net of allowance (2008 – $596; 2007 – $662) 20,050 18,395
Reinsurance assets, net of allowance (2008 – $502; 2007 – $520) 22,940 23,103
Current and deferred income taxes 8,211 —
Deferred policy acquisition costs 46,733 43,914
Investments in partially owned companies 628 654
Real estate and other fixed assets, net of accumulated depreciation (2008 – $5,710; 2007 –
$5,446) 5,692 5,518
Separate and variable accounts, at fair value 73,401 78,684
Goodwill 10,661 9,414
Other assets (amount measured at fair value: 2008 – $2,452; 2007 – $4,152) 17,115 17,766
Total assets $1,049,876 $1,048,361
See Accompanying Notes to Consolidated Financial Statements.
1 BOG-- FOIA 10-251 --000059

CONSOLIDATED BALANCE SHEET (continued)
(in millions, except share data) (unaudited)

2008 2007
Liabilities:
Reserve for losses and loss expenses $ 88,747 $ 85,500
Unearned premiums 28,738 27,703
Future policy benefits for life and accident and health insurance contracts 147,232 136,387
Policyholders’ contract deposits (amount measured at fair value: 2008 – $4,179; 2007 – $295) 265,411 258,459
Other policyholders’ funds 13,773 12,599
Commissions, expenses and taxes payable 5,597 6,310
Insurance balances payable 5,569 4,878
Funds held by companies under reinsurance treaties 2,498 2,501
Current income taxes payable — 3,823
Financial Services liabilities:
Securities sold under agreements to repurchase (amount measured at fair value: 2008 –
$8,338) 9,659 8,331
Trade payables 1,622 6,445
Securities and spot commodities sold but not yet purchased, at fair value 3,189 4,709
Unrealized loss on swaps, options and forward transactions, at fair value 24,232 14,817
Trust deposits and deposits due to banks and other depositors (amount measured at fair
value: 2008 – $240) 6,165 4,903
Commercial paper and extendible commercial notes 15,061 13,114
Long-term borrowings (amount measured at fair value: 2008 – $53,839) 163,577 162,935
Separate and variable accounts 73,401 78,684
Securities lending payable 75,056 81,965
Minority interest 11,149 10,422
Other liabilities (amount measured at fair value: 2008 – $6,861; 2007 – $3,262) 31,012 27,975
Total liabilities 971,688 952,460
Preferred shareholders’ equity in subsidiary companies 100 100
Commitments, Contingencies and Guarantees (See Note 6)
Shareholders’ equity:
Common stock, $2.50 par value; 5,000,000,000 shares authorized; shares issued 2008 –
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
Additional paid-in capital 9,446 2,848
Payments advanced to purchase shares — (912)
Retained earnings 73,743 89,029
Accumulated other comprehensive income (loss) (3,903) 4,643
Treasury stock, at cost; 2008 – 259,225,244; 2007 – 221,743,421 shares of common stock (8,568) (6,685)
Total shareholders’ equity 78,088 95,801
Total liabilities, preferred shareholders’ equity in subsidiary companies and shareholders’ equity $1,049,876 $1,048,361
2 BOG-- FOIA 10-251 --000060

CONSOLIDATED STATEMENT OF INCOME (LOSS)
(in millions, except per share data) (unaudited)

Three Months Six Months
Ended June 30, Ended June 30,
2008 2007 2008 2007
Revenues:
Premiums and other considerations $21,735 $19,533 $ 42,407 $39,175
Net investment income 6,728 7,853 11,682 14,977
Net realized capital losses (6,081) (28) (12,170) (98)
Unrealized market valuation losses on AIGFP super senior credit default swap
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Benefits and expenses:
Incurred policy losses and benefits 18,450 16,221 34,332 32,367
Insurance acquisition and other operating expenses 10,239 8,601 19,652 16,928
Total benefits and expenses 28,689 24,822 53,984 49,295
Income (loss) before income taxes (benefits) and minority interest (8,756) 6,328 (20,020) 12,500
Income taxes (benefits) (3,357) 1,679 (6,894) 3,405
Income (loss) before minority interest (5,399) 4,649 (13,126) 9,095
Minority interest 42 (372) (36) (688)
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Earnings (loss) per common share:
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Dividends declared per common share $ 0.220 $ 0.200 $ 0.420 $ 0.365
Average shares outstanding:
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000061

Subject: Re: Background on AIG
Date: 09/13/2008 05:24 AM
Thanks, Bill. Could you send me the Word document?
Brian
William B
English/BOARD/FRS
To Brian F Madigan/BOARD/FRS@BOARD
cc James A Clouse/BOARD/FRS@BOARD, Roberto
Perli/BOARD/FRS@BOARD, William B
09/13/2008 02:24 AM English/BOARD/FRS@BOARD, William R
Nelson/BOARD/FRS@BOARD
Subject Background on AIG
Duplicate
BOG-- FOIA 10-251 --000062

To: Scott Alvarez; Deborah P Bailey
Subject: AIG
Date: 09/13/2008 07:36 AM
Scott and Deborah,
Do we have any responsibility, or is it in the Board's interest, to notify any other

supervisors (U.S. or foreign) about the current issues regarding the firm?
Brian
BOG-- FOIA 10-251 --000063

From: Alejandro.LaTorre@ny.frb.org
To: Brian Madigan
Date: 09/13/2008 07:42 AM
Brian,
Below is the quick note I drafted for Bill. Tim and others about the
meeting last night.
Regards,
Alex
Sent from my BlackBerry Handheld
Duplicate
BOG-- FOIA 10-251 --000064

To: Scott Alvarez; Deborah P Bailey; James A Clouse; William B English; Michael S Gibson; William R Nelson;
Roberto Perli; Patrick M Parkinson
Cc: Brian F Madigan
Date: 09/13/2008 07:57 AM
----- Forwarded by Brian F Madigan/BOARD/FRS on 09/13/2008 07:52 AM -----
Alejandro.LaTorre@ny.frb.org
To "Brian Madigan" <Brian.F.Madigan@frb.gov>
cc
09/13/2008 07:42 AM
Subject Fw: Update on AIG
Brian,
Below is the quick note I drafted for Bill. Tim and others about the
meeting last night.
Regards,
Alex
Duplicate
BOG-- FOIA 10-251 --000065

To: Scott Alvarez
Cc: Brian Peters; Dianne Dobbeck; Millie Martinez
Subject: Re: Material - As per Alex LaTorre
Date: 09/13/2008 08:04 AM
Scott;
I have Jacob's information
email: jacob.frankel@aig.com
Tel: 212-770-8860
Cell: (b) (6)
Regards,
Alex
▼ Scott Alvarez/BOARD/FRS@BOARD
Scott
Alvarez/BOARD/FRS@BOARD
To Millie Martinez/NY/FRS@FRS
cc Alejandro LaTorre/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Dianne
09/13/2008 07:59 AM Dobbeck/NY/FRS@FRS
Subject
Re: Material - As per Alex LaTorre
Millie,
Thanks. Can we also get the contact information? It would be good
to know who was at the meeting and who Brian and I should contact,
since at least Jacob is expecting one of us to call.
Thanks!
Scott
▼ Millie Martinez/NY/FRS@FRS
Millie
Martinez/NY/FRS@FRS
To Scott Alvarez/BOARD/FRS@BOARD
cc Alejandro LaTorre/NY/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS, Brian Peters/NY/FRS@FRS
09/12/2008 10:56 PM
Subject Material - As per Alex LaTorre
BOG-- FOIA 10-251 --000066

[attachment "DOC20080912224308.pdf" deleted by Alejandro
LaTorre/NY/FRS] [attachment "DOC20080912224106.pdf" deleted by
Alejandro LaTorre/NY/FRS] [attachment "DOC20080912224133.pdf"
deleted by Alejandro LaTorre/NY/FRS] [attachment
"DOC20080912224156.pdf" deleted by Alejandro LaTorre/NY/FRS]
[attachment "DOC20080912224157.pdf" deleted by Alejandro
LaTorre/NY/FRS] [attachment "DOC20080912224232.pdf" deleted by
Alejandro LaTorre/NY/FRS]
BOG-- FOIA 10-251 --000067

To: (b) (6)
Subject: AIG
Date: 09/13/2008 08:07 AM
Mr. Chairman,
Staff participated in a call yesterday evening in which AIG further briefed us on the
firm's situation. The firm is requesting a loan from the Federal Reserve. We are in
the office this morning analyzing the situation. We will brief you soon.
Brian
BOG-- FOIA 10-251 --000068

To: Brian F Madigan; Deborah Bailey
Subject: Re: Update on AIG
Date: 09/13/2008 08:11 AM
Obvious question is what major bank counterparties think their exposures are. Given
market awareness of AIG's prblems, I see no reason not to ask the banks. Pat
▼ Brian F Madigan

Sent: 09/13/2008 07:57 AM EDT
To: Scott Alvarez; Deborah Bailey; James Clouse; William English;
Michael Gibson; William Nelson; Roberto Perli; Patrick Parkinson
Cc: Brian Madigan
Alejandro.LaTorre@ny.frb.org
To "Brian Madigan" <Brian.F.Madigan@frb.gov>
cc
09/13/2008 07:42 AM
Subject Fw: Update on AIG
Brian,
Below is the quick note I drafted for Bill. Tim and others about
the
meeting last night.
Regards,
Alex
Duplicate
BOG-- FOIA 10-251 --000069

To: Patrick M Parkinson; Brian F Madigan
Date: 09/13/2008 08:37 AM
Pat, we got it last night.

--------------------------

From: Patrick.M.Parkinson
Sent: 09/13/2008 08:11 AM AST
To: Brian Madigan; Deborah Bailey
Obvious question is what major bank counterparties think their exposures

are. Given market awareness of AIG's prblems, I see no reason not to ask
the banks. Pat
Duplicate
BOG-- FOIA 10-251 --000070

From: Scott Alvarez
To: (b) (6)
Subject: Re: Conf call at 10 am
Date: 09/13/2008 08:46 AM
(b) (5) .
FYI, there is a call with the foreign supervisors at 9. Deborah will be on that call
Brian and I will stop by within the hour to discuss AIG with you
Scott
--------------------------
▼ (b) (6)

From: (b) (6)
Sent: :41 AM EDT
To: Scott Alvarez; Brian Madigan; Patrick Parkinson
Cc: Donald Kohn
Subject: Conf call at 10 am
To brief foreign cent banks. I will take in my ofc. Optional. Let me
know if you need number.
Scott, (b) (5)

--------------------------
BOG-- FOIA 10-251 --000071

From: Donald L Kohn
To: Timothy Geithner; Kevin Warsh
Cc: (b) (6)
Subject: AIG
Date: 09/13/2008 10:00 AM
Staff has been in contact with AIG (Jacob) this morning. AIG sees this as a liquidity
event and has investment bankers looking at assets this weekend but will not sell off
core assets and is not seeking a major equity injection or strategic partner. they
face the possibility of a multi-grade downgrade ffrom Moody's on Monday, which
would probably be the death knell. They were vague as to what they expected from
us except that it sounded like an open ended liquidity facility. (b) (5)
AIG will get back to us later this morning with a more
specific request for us and a more specific plan for raising cash and capital. they are
talking to the insurance commisioners at 10. (b) (5)

BOG-- FOIA 10-251 --000072

From: Donald L Kohn
To: Scott Alvarez; Brian Madigan; Deborah Bailey
Subject: Fw: AIG
Date: 09/13/2008 10:03 AM
Meant to cc you on this.

--------------------------
▼ Donald L Kohn

From: Donald L Kohn
Sent: 09/13/2008 10:00 AM EDT
To: ner; Kevin Warsh
Cc: (b) (6)
Subj
Duplicate
BOG-- FOIA 10-251 --000073

To: Scott Alvarez
Cc: Donald L Kohn
Subject: AIG
Date: 09/13/2008 10:10 AM
Scott,
Jacob Frenkel just called. He will call back to my office with someone named
Williamson at 11:00 a.m. to discuss their efforts to sell assets. Is that time OK with
you?
Brian
BOG-- FOIA 10-251 --000074

From: Scott Alvarez
To: Brian F Madigan
Subject: Re: AIG
Date: 09/13/2008 10:11 AM
Yes. I'll come to your office.

Scott
▼ Brian F Madigan/BOARD/FRS
Brian F
Madigan/BOARD/FRS
cc Donald L Kohn/BOARD/FRS@BOARD
09/13/2008 10:10 AM Subject AIG
Duplicate
BOG-- FOIA 10-251 --000075

Calendar Entry Notify me
Meeting Mark Private Pencil In
Update on AIG Solvency / 1-888-808-6929 / Access Code: Chair Carol Grunwald/NY/FRS

Subject
9494579# / Participation Code: 6133#
Location
Starts Sat 09/13/2008 02:00 PM
1 hour The following have been
When Reserved
Ends Sat 09/13/2008 03:00 PM requested
Where
Specify a different time zone M9 MKT Central
Rooms Meeting Room 1/NY
Invited The following invitees have been invited Main Building@FRS
Invitees Adam Ashcraft/NY/FRS@FRS, Alejandro

Required (to) LaTorre/NY/FRS@FRS, Brian F Categorize
Madigan/BOARD/FRS@BOARD, Christopher
Description
Your Notes
BOG-- FOIA 10-251 --000076

To: Brian F Madigan
Subject: AIG call now
Date: 09/13/2008 11:02 AM
Any chance I could call in and listen to AIG's discussion with you?
BOG-- FOIA 10-251 --000077

From: (b) (6)
To: Donald L Kohn
Cc: Kevin Warsh; Timothy Geithner
Subject: Re: AIG
Date: 09/13/2008 11:13 AM
(b) (5)

▼ Donald L Kohn/BOARD/FRS
Donald L
Kohn/BOARD/FRS
To Timothy Geithner/NY/FRS@FRS, Kevin
Warsh/BOARD/FRS@BOARD
cc (b) (6)
09/13/2008 10:00 AM
Subject AIG
Duplicate
BOG-- FOIA 10-251 --000078

From: James A Clouse
To: William B English; William R Nelson
Subject: Fw: Update on AIG Solvency / 1-888-808-6929 / Access Code: 9494579# / Participation Code: 6133#
Date: 09/13/2008 11:21 AM
jclouse@frb.gov
cell: 703-304-6276
blackberry: 202-390-3521
----- Forwarded by James A Clouse/BOARD/FRS on 09/13/2008 11:22 AM -----
Calendar Entry
Meeting
Subject Chair
Update on AIG Solvency / 1-888-808-6929 / Access Carol Grunwald/NY/FRS
Code: 9494579# / Participation Code: 6133#
When Where
Location
Starts Sat 09/13/2008 02:00 PM Reserved The following have been

1 hour requested
Ends Sat 09/13/2008 03:00 PM

Rooms M9 MKT Central Meeting
Room 1/NY Main
Building@FRS
Invitees
Invited The following invitees have been invited
Required Adam Ashcraft/NY/FRS@FRS, Alejandro

(to) LaTorre/NY/FRS@FRS, Brian F
Madigan/BOARD/FRS@BOARD, Meeting
Christopher Calabia/NY/FRS@FRS, Password
Deborah P
Bailey/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD, Jamie
McAndrews/NY/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD,
Michael S Categorize
Gibson/BOARD/FRS@BOARD, Michael
Schetzel/NY/FRS@FRS, Patricia
Mosser/NY/FRS@FRS, Scott
BOG-- FOIA 10-251 --000079

Alvarez/BOARD/FRS@BOARD, Tobias
Adrian/NY/FRS@FRS, William
Dudley/NY/FRS@FRS
Description
Your
Notes
BOG-- FOIA 10-251 --000080

Not Responsive
▼ Coryann Stefansson/BOARD/FRS@BOARD
Coryann
Stefansson/BOARD/FRS@BOARD
To Suzanna Costello/ATL/FRS@FRS, James
Barnes/RICH/FRS@FRS, Steven M
Durfey/BSR/CHI/FRS@FRS,
09/13/2008 11:17 AM Ron.Feldman@mpls.frb.org,
Nadine.M.Wallman@clev.frb.org, Suzanne
Killian/BOARD/FRS@BOARD, Phyllis L
Harwell/BOARD/FRS@BOARD, William
Charwat/BOARD/FRS, Chris
Haley/BOS/FRS@FRS, Kim
Jensik/BOARD/FRS@BOARD, Jon D
Greenlee/BOARD/FRS, Jerrold L
Newlon/CLEV - BSR12/CLEV/FRS@FRS
cc
Subject Lehman, Wamu and AIG Restricted
Hi All
Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000081

AIG is an emerging issue and I will update you as events arise but I get a sense if
things get bad this issue could devolve quickly. Here too you need to get a sense of
exposure/risk to AIG.
Not Responsive
I am in the office if you need me
Coryann S. Stefansson
Associate Director
Bank Supervision and Regulation
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829
Assistant - Ms. Kimberly Jensik

Kim.Jensik@frb.gov
Office Number 202 736-5555
BOG-- FOIA 10-251 --000082

From: Donald L Kohn
To: (b) (6)
Subject: Re: AIG
Date: 09/13/2008 11:36 AM
(b) (5)
▼ (b) (6)
(b) (6)
To Donald L Kohn/BOARD/FRS@BOARD
cc Kevin Warsh/BOARD/FRS@BOARD, Timothy
Geithner/NY/FRS@FRS
09/13/2008 11:14 AM
Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000083

From: (b) (6)
To: Donald L Kohn
Subject: Re: AIG
Date: 09/13/2008 11:38 AM
Thanks.
Donald L
Kohn/BOARD/FRS
To (b) (6)
cc
09/13/2008 11:36 AM Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000084

From: Michael.S.Gibson@frb.gov
To: Christopher.Calabia@ny.frb.org; Tobias.Adrian@ny.frb.org; Adam.Ashcraft@ny.frb.org
Subject: aig
Date: 09/13/2008 11:51 AM
Chris et al,
Can one of you guys give me a call so we can coordinate the work on AIG and
hopefully reduce overlap?
Thanks,
Mike
202-452-2495
BOG-- FOIA 10-251 --000085

Subject: memo
Date: 09/13/2008 12:25 PM
Attachments: AIG memo.doc
Here is what I have. Derivatives are on p. 3. Comments on anything are very
welcome.
Thanks,
Bill E.
BOG-- FOIA 10-251 --000086

(b) (5)
BOG-- FOIA 10-251 --000087

(b) (5)
(b) (5)
BOG-- FOIA 10-251 --000088

(b) (5)
BOG-- FOIA 10-251 --000089

(b) (5)
(b) (5)
BOG-- FOIA 10-251 --000090

From: Tobias Adrian
Cc: Adam Ashcraft; Christopher Calabia; Michael S Gibson
Subject: Re: aig
Date: 09/13/2008 12:26 PM
Hello Mike,
here is what we are working on:
1) Chris Calabia: assesment of liquidity / solvency of AIG and subs
2) Adam Ashcraft / Warren Hrung: assesment of collateral valuation, both

fundamental and market based
3) Tobias Adrian: systemic risk asessment
Let me know if you want further info.
I am on the 9th floor with the markets group, you can reach me on blackberry at
(b) (6)
-------------------------------------------------------------------
Tobias Adrian
Capital Markets Research
Tel: (212) 720-1717
http://nyfedeconomists.org/adrian/
------------------------------------------------------------------
The views in this message are those of the sender and not necessarily those of the
Federal Reserve Bank of New York or the Federal Reserve System.
▼ Michael S Gibson/Board/FRS@BOARD
Michael S
Gibson/Board/FRS@BOARD
To Christopher Calabia/NY/FRS@FRS, Tobias
Sent by: Michael S
Adrian/NY/FRS@FRS, Adam
Ashcraft/NY/FRS@FRS
cc
Subject aig
09/13/2008 11:54 AM
Duplicate
BOG-- FOIA 10-251 --000091

From: Adam Ashcraft
To: Alejandro LaTorre; Warren Hrung
Cc: Tobias Adrian; Michael S Gibson
Subject: AIG solvency
Date: 09/13/2008 12:27 PM
(b) (5)
ABA
Adam B. Ashcraft
Financial Intermediation Function
BOG-- FOIA 10-251 --000092

(212) 720-1617 phone
(212) 720-8363 fax
(b) (6)
-----------------------------------------------------------------------------------------------------
The contents of this e-mail reflect the opinion of the author and not the opinion of
the Federal Reserve Bank of New York or the Federal Reserve System.
BOG-- FOIA 10-251 --000093

From: Adam Ashcraft
To: Tobias Adrian
Cc: Christopher Calabia; Michael S Gibson
Subject: Re: aig
Date: 09/13/2008 12:27 PM
Tobais
I circled around with Alex and am working on the solvency question. It looks like
Markets has the collateral issue in control
ABA
Adam B. Ashcraft
(212) 720-1617 phone
(212) 720-8363 fax
(b) (6)
-----------------------------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000094

From: Tobias Adrian
To: Adam Ashcraft
Cc: Christopher Calabia; Michael S Gibson
Subject: Re: aig
Date: 09/13/2008 12:29 PM
ok
-------------------------------------------------------------------
Tobias Adrian
Tel: (212) 720-1717
------------------------------------------------------------------
▼ Adam Ashcraft/NY/FRS
Adam
Ashcraft/NY/FRS
To Tobias Adrian/NY/FRS@FRS
cc Christopher Calabia/NY/FRS@FRS, Michael S
Gibson/Board/FRS@BOARD
09/13/2008 12:31 PM
Subject
Re: aig
Duplicate
BOG-- FOIA 10-251 --000095

To: Alejandro LaTorre; Richard Charlton; Tobias Adrian; jim.mahoney@ny.frb.org; Catherine Voigts; Adam
Ashcraft; Michael Schetzel; Terrence Checki; William Rutledge; Brian Peters; christine.cumming@ny.frb.org;
Meg McConnell; Warren Hrung; Hayley Boesky; Chris Burke; Richard Dzina; William Walsh
Cc: Brian F Madigan; Scott Alvarez
Subject: AIG/Board call
Date: 09/13/2008 12:51 PM
Summary of 11 am call between AIG and BOG:
Attendees from AIG: CEO, CFO, Vice Chm, JPMC bankers (lead: Doug Bronski)
Attendees from Board staff: Brian Madigan, Scott Alvarez
FRBNY: Trish Mosser, Rich Charlton
(b) (4)
(b) (5)
(b) (4)
(b) (4)
(b) (4) (b) (5)

(b) (5)
(b)(4) & (b)(5)
(b) (4)
BOG-- FOIA 10-251 --000096

Scott finished the call telling them they should not be particularly optimistic, given
the hurtles and history of 13-3 lending.
BOG-- FOIA 10-251 --000097

To: Adam.Ashcraft@ny.frb.org
Cc: Alejandro.LaTorre@ny.frb.org; Tobias.Adrian@ny.frb.org; Warren.Hrung@ny.frb.org
Subject: Re: AIG solvency
Date: 09/13/2008 12:57 PM
Adam,
(b) (5)
(b) (5)
(b) (5)
(b) (5)
Mike
Adam
Ashcraft/NY/FRS@F
RS To
Alejandro LaTorre/NY/FRS@FRS,
09/13/2008 12:27 Warren Hrung/NY/FRS@FRS
PM cc
Tobias Adrian/NY/FRS@FRS, Michael S
Subject
AIG solvency
Duplicate
BOG-- FOIA 10-251 --000098

From: Brandon Hall
To: BSR LFIC
Subject: LFI Exposures to AIG (9/13/08 AM Update)
Date: 09/13/2008 01:00 PM
Attachments: LFI Key Credit Exposures to AIG 091308.xls
RESTRICTED FR
---
Below and attached please find the most current version of LFI credit exposures to AIG. This data represents the best information
available, culled from the sources at hand (i.e. not reaching out directly to the firms). Using flow-basis traffic, we will work to update
this information over the course of today and going forward.
(b)(4) & (b)(8)
____________________________________
Brandon J. Hall
Counterparty Credit Risk Monitoring & Analysis
33 Liberty St. | New York, NY 10045
P: 212-720-1349
F: 212-720-1468
E: brandon.hall@ny.frb.org
BOG-- FOIA 10-251 --000099

BOG-- FOIA 10-251 --000100
To: Michael S Gibson; Christopher Calabia
Subject: Rough cut at a liquidity section
Date: 09/13/2008 01:01 PM
Attachments: AIG Funding and Liquidity Needs.doc
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000101

(b) (5)
BOG-- FOIA 10-251 --000102

From: Warren Hrung
To: Adam Ashcraft
Cc: Alejandro LaTorre; Michael S Gibson; Tobias Adrian
Date: 09/13/2008 01:01 PM
Very quick and dirty. (b) (5)
Warren B. Hrung
Analytical Development
Markets Group
(212) 720 - 6054
▼ Adam Ashcraft/NY/FRS
Adam
Ashcraft/NY/FRS
To Alejandro LaTorre/NY/FRS@FRS, Warren
Hrung/NY/FRS@FRS
cc Tobias Adrian/NY/FRS@FRS, Michael S
09/13/2008 12:30 PM Gibson/BOARD/FRS@BOARD
Subject AIG solvency
Duplicate
BOG-- FOIA 10-251 --000103

From: Adam Ashcraft
Cc: Alejandro LaTorre; Tobias Adrian; Warren Hrung
Date: 09/13/2008 01:03 PM
Mike
(b) (5)


Sent: 09/13/2008 12:57 PM EDT
To: Adam Ashcraft
Adam,
Duplicate
▼ Adam Ashcraft/NY/FRS@FRS
Adam
Ashcraft/NY/FRS@FRS
To Alejandro LaTorre/NY/FRS@FRS, Warren
Hrung/NY/FRS@FRS
cc Tobias Adrian/NY/FRS@FRS, Michael S
09/13/2008 12:27 PM Gibson/BOARD/FRS@BOARD
Subject AIG solvency
Duplicate
BOG-- FOIA 10-251 --000104

From: Coryann Stefansson
To: Pat Soriano; William Charwat; Catherine A Tilford; Laura A Macedo; Gregory H Feldberg; Cheryl Taylor; Nancy R Berlad; Kwayne Jennings; Nancy J Oakes; Tim P Clark; David Gibson; Matthew
L Canzater; Christine E Schwaninger; Genevievette E Walker
Subject: Fw: LFI Exposures to AIG (9/13/08 AM Update)
Date: 09/13/2008 01:07 PM
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
----- Forwarded by Coryann Stefansson/BOARD/FRS on 09/13/2008 01:06 PM -----
Brandon Hall/NY/FRS@FRS
To BSR LFIC
cc
09/13/2008 01:00 PM
Subject LFI Exposures to AIG (9/13/08 AM Update)
Duplicate
BOG-- FOIA 10-251 --000105

To: James A Clouse; William B English; William R Nelson; Roberto Perli; Michael S Gibson; Deborah P Bailey; Jon D
Greenlee
Cc: Brian F Madigan
Subject: Fw: AIG/Board call
Date: 09/13/2008 01:10 PM
Patricia
Mosser/NY/FRS@FRS
To Alejandro LaTorre/NY/FRS@FRS@NY, Richard
Charlton/NY/FRS@FRS, Tobias Adrian/NY/FRS@FRS,
jim.mahoney@ny.frb.org, Catherine
09/13/2008 12:51 PM Voigts/NY/FRS@FRS, Adam Ashcraft/NY/FRS@FRS,
Michael Schetzel/NY/FRS, Terrence Checki/NY/FRS,
William Rutledge/NY/FRS@FRS@NY, Brian
Peters/NY/FRS, christine.cumming@ny.frb.org, Meg
McConnell/NY/FRS@FRS, Warren Hrung/NY/FRS,
Hayley Boesky/NY/FRS, Chris Burke/NY/FRS, Richard
Dzina/NY/FRS, William Walsh/NY/FRS
cc Brian F Madigan/BOARD/FRS@BOARD, Scott
Subject AIG/Board call
Duplicate
BOG-- FOIA 10-251 --000106

Meeting Update Request:
Calendar Entry
Subject: Update on AIG Solvency / 1-888-808-6929 / Access Code: 9494579# / Participation Code: 6133#
When
Date: Saturday 09/13/2008
Time: 02:00 PM - 03:00 PM (1 hour)
Chair: Carol Grunwald
Invitees
Required (to): Adam Ashcraft/NY/FRS@FRS; Alejandro LaTorre/NY/FRS@FRS; Brian F Madigan/BOARD/FRS@BOARD;
Catherine Voigts/NY/FRS@FRS; Christopher Calabia/NY/FRS@FRS; Deborah P Bailey/BOARD/FRS@BOARD;
Hayley Boesky/NY/FRS@FRS; James A Clouse/BOARD/FRS@BOARD; Jamie McAndrews/NY/FRS@FRS; Jim
Mahoney/NY/FRS@FRS; Jon D Greenlee/BOARD/FRS@BOARD; Michael S Gibson/BOARD/FRS@BOARD; Michael
Schetzel/NY/FRS@FRS; Patricia Mosser/NY/FRS@FRS; Scott Alvarez/BOARD/FRS@BOARD; Susan
Stiehm/NY/FRS@FRS; Terrence Checki/NY/FRS@FRS; Tobias Adrian/NY/FRS@FRS; William
Dudley/NY/FRS@FRS
Optional (cc):
Where
Location: Operations Room
Room changed to the Operations Room, 9th floor.
BOG-- FOIA 10-251 --000107

To: Jon D Greenlee; William B English; William R Nelson; Christopher Calabia; Adam Ashcraft; Alejandro LaTorre;
Roberto Perli; James A Clouse
Subject: derivatives
Date: 09/13/2008 01:57 PM
Attachments: aig-derivatives.doc
I've written up a page on derivatives with the limited information I have. If anyone
can fill in any details, please do so.
Mike
BOG-- FOIA 10-251 --000108

(b) (5)
BOG-- FOIA 10-251 --000109

(b) (5)
BOG-- FOIA 10-251 --000110

From: Tobias Adrian
To: Michael S Gibson; Adam Ashcraft
Cc: Alejandro LaTorre; Warren Hrung
Date: 09/13/2008 02:04 PM
Mike,
I have put together a note on spillover risk, i will send it to you after the call.
Tobias

Sent: 09/13/2008 12:57 PM EDT
To: Adam Ashcraft
Duplicate
BOG-- FOIA 10-251 --000111

From: Scott Alvarez
To: Donald Kohn
Subject: Fw: Material - As per Alex LaTorre
Date: 09/13/2008 02:09 PM
Don
The cell number has been the most effective way to reach Jacob
Scott
--------------------------
▼ Alejandro LaTorre

Sent: 09/13/2008 08:07 AM EDT
To: Scott Alvarez
Cc: Brian Peters; Dianne Dobbeck; Millie Martinez
Subject: Re: Material - As per Alex LaTorre
Scott;
I have Jacob's information
email: jacob.frankel@aig.com
Tel: 212-770-8860
Cell: (b) (6)
Regards,
Alex
Duplicate
BOG-- FOIA 10-251 --000112

To: Gregory H Feldberg
Subject: Re: MONDAY IMPORTANT....
Date: 09/13/2008 02:34 PM
Yep...its pretty bad

Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
▼ Gregory H Feldberg

From: Gregory H Feldberg
Sent: 09/13/2008 01:41 PM EDT
To: Coryann Stefansson
Subject: Re: MONDAY IMPORTANT....
Wow... so I should get out of ExMan after all?

Greg Feldberg
Office: (202) 452-2598
Cellphone: (202) 390-0201
▼ Coryann Stefansson

Sent: 09/13/2008 01:13 PM EDT
To: Pat Soriano; William Charwat; Catherine Tilford; Laura
Macedo; Gregory Feldberg; Cheryl Taylor; Nancy Berlad; Kwayne
Jennings; Nancy Oakes; Tim Clark; David Gibson; Matthew
Canzater; Christine Schwaninger; Genevievette Walker
Subject: MONDAY IMPORTANT....
Hey ALL
I need everyone in the office on Monday morning ...Sorry to do this to

you but unless you are out of state I need you here. There are
significant issues at Lehman and Aig....I will arrange a call with you on
Sunday nite at 7 pm.......I will send an email appt for Sunday nite....We
need to be monitoring and analyzing our firms etc and implications
from market events.....
I am sending an appt to you shortly .....
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
BOG-- FOIA 10-251 --000113

To: James Barnes
Subject: Re: Lehman, Wamu and AIG Restricted
Date: 09/13/2008 02:35 PM
Sorry.....need to get an understanding of lehman bros exposures at the firm and

aig......without going to the firm.....anychance u all have reports lying around
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
▼ James Barnes

From: James Barnes
Sent: 09/13/2008 01:44 PM EDT
Subject: Re: Lehman, Wamu and AIG Restricted
Cory
I am unable to open this message on my blackberry because of the
encryption.
Can this wait until Monday or should I drive into the office to read.
Jim
--------------------------
▼ Coryann Stefansson

Sent: 09/13/2008 11:14 AM EDT
To: Suzanna Costello; James Barnes; Steven Durfey; Ron
Feldman; Nadine Wallman; Suzanne Killian; Phyllis Harwell;
William Charwat; Chris Haley; Kim Jensik; Jon Greenlee; Jerrold
Newlon
Subject: Lehman, Wamu and AIG Restricted
[This message was encrypted by the sender]
BOG-- FOIA 10-251 --000114

To: James Embersit
Subject: Re: Urgent conference call
Date: 09/13/2008 02:48 PM
Don't worry, we can talked in the morning. Not Responsive

we've been dealing with a likely liquidity crisis at AIG
early next week. Not Responsive
(b) (5) .
Just wanted to talk about steps on Monday and to get everyone prepared.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
▼ James Embersit/BOARD/FRS
James
Embersit/BOARD/FRS
To Jon D Greenlee/BOARD/FRS@BOARD
cc
09/13/2008 02:45 PM Subject
Re: Urgent conference call
Turns out I can't get to a land line. Pay phones are obsolete.
Will keep looking but may have to do cell for me.
Jim Embersit
office - 202-452-5249
cell-202-528-7884
-Jim Embersit
202-452-5249
-------------------------
▼ Jon D Greenlee

Sent: 09/13/2008 01:58 PM EDT
To: Sabeth Siddique; James Embersit
I'd rather not do this on cell phones - is there landline where I can reach you?
BOG-- FOIA 10-251 --000115

Jon Greenlee
Associate Director
Phone (202) 452-2962
▼ Sabeth I Siddique/BOARD/FRS
Sabeth I
Siddique/BOARD/FRS
cc
09/13/2008 01:51 PM Subject
Re: Urgent conference call
(b) (5)
--------------------------
▼ Jon D Greenlee

Sent: 09/13/2008 01:38 PM EDT
To: James Embersit; Sabeth Siddique; Adrienne Haden; Nina
Nichols
Subject: Urgent conference call
We need to talk about the developments in the marketplace and possible next
steps. I suggest we have a call tomorrow morning at 10 AM, but if tonight is better,
let me know.
The always on conference call line is (202) 452-3568 pass code 123456
Thanks
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000116

From: Donald L Kohn
To: Scott.Alvarez@frb.gov
Cc: brian.f.madigan@frb.gov
Subject: Re: Fw: Material - As per Alex LaTorre
Date: 09/13/2008 02:52 PM
update: brief conversation with Jacob. Tol dhim we were "very reluctant" to open
up another 13-3 facility for an entity not even an investment bank. And that the
market thought it was not only a liquidity problem but also a capital problem. He
gave me the bridge to asset sales speech and then said he would get willumsted
and call me back. I'm waiting.
BOG-- FOIA 10-251 --000117

From: James Embersit
To: Jon D Greenlee
Date: 09/13/2008 02:54 PM
Great
Will be fully prepared for tomorrows call
Jim Embersit
office - 202-452-5249
cell-202-528-7884
-Jim Embersit
202-452-5249
-------------------------
▼ Jon D Greenlee

Sent: 09/13/2008 02:48 PM EDT
To: James Embersit
Duplicate
BOG-- FOIA 10-251 --000118

To: Christopher Calabia; William R Nelson; William B English; James A Clouse; Alejandro LaTorre; Brian F Madigan;
Deborah P Bailey
Subject: AIG's Ins Companies
Date: 09/13/2008 03:04 PM
Reading the AM Best stuff more closely, all the insurance subs were downgraded in
June 2008 and the outlook was flagged as "negative".
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000119

From: Roger Cole
Subject: Re: AIG/Board call
Date: 09/13/2008 03:05 PM
Not good!
--------------------------
BOG-- FOIA 10-251 --000120

From: Donald L Kohn
To: Randall S Kroszner
Subject: several items
Date: 09/13/2008 03:19 PM
1. Talked briefly to AIG, and awaiting a call back, (b)(4) & (b)(5)
2. According to Ben, (b) (5)
3. (b) (5)

Don
BOG-- FOIA 10-251 --000121

Subject: Re: AIG's Ins Companies
Date: 09/13/2008 03:31 PM
AM Best rates their claims paying ability. They went from A++G (the highest rating)
to A+G with a negative outlook. I'm going to drop the stuff off on my way out.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
William B
English/BOARD/FRS
cc
09/13/2008 03:26 PM Subject
Re: AIG's Ins Companies
Downgraded to what and why? Moody's downgraded a bunch of AIG subs because
they had guarantees from the holding company and the holding company got
downgraded.
--Bill E.
▼ Jon D Greenlee/BOARD/FRS
Duplicate
BOG-- FOIA 10-251 --000122

Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000123

Meeting Invitation:
Calendar Entry
Subject: AIG Update
When
Time: 04:00 PM - 05:00 PM (1 hour)
Chair: Kristin Mayer
Invitees
Required (to): Adam Ashcraft/NY/FRS@FRS; Alejandro LaTorre/NY/FRS@FRS; Arthur Angulo/NY/FRS@FRS; Beverly
Hirtle/NY/FRS@FRS; Brian Peters/NY/FRS@FRS; Calvin Mitchell/NY/FRS@FRS; Catherine Voigts/NY/FRS@FRS;
Chris Burke/NY/FRS@FRS; Chris McCurdy/NY/FRS@FRS; Hayley Boesky/NY/FRS@FRS; Helen
Mucciolo/NY/FRS@FRS; Jamie McAndrews/NY/FRS@FRS; Jeanmarie Davis/NY/FRS@FRS; Jim
Mahoney/NY/FRS@FRS; Joyce Hansen/NY/FRS@FRS; Lawrence Radecki/NY/FRS@FRS; Lucinda M
Brickler/NY/FRS@FRS; Meg McConnell/NY/FRS@FRS; Michael Schetzel/NY/FRS@FRS; Patricia
Mosser/NY/FRS@FRS; Patrick M Parkinson/BOARD/FRS@BOARD; Richard Charlton/NY/FRS@FRS; Richard
Dzina/NY/FRS@FRS; Sandy Krieger/NY/FRS@FRS; Sarah Bell/NY/FRS@FRS; Sarah Dahlgren/NY/FRS@FRS;
Simon Potter/NY/FRS@FRS; Steven J Manzari/NY/FRS@FRS; Terrence Checki/NY/FRS@FRS; Theodore
Lubke/NY/FRS@FRS; Thomas Baxter/NY/FRS@FRS; Til Schuermann/NY/FRS@FRS; Timothy
Geithner/NY/FRS@FRS; Tobias Adrian/NY/FRS@FRS; Warren Hrung/NY/FRS@FRS; Wendy Ng/NY/FRS@FRS;
William BRODOWS/NY/FRS@FRS; William Dudley/NY/FRS@FRS; William Rutledge/NY/FRS@FRS; William
Walsh/NY/FRS@FRS
Optional (cc): Alexandra Merle-Huet/NY/FRS@FRS; Bettyann Griffith/NY/FRS@FRS; Daniel Boulos/NY/FRS@FRS; Marlene
Williams/NY/FRS@FRS; Michael Held/NY/FRS@FRS; Michael Silva/NY/FRS@FRS; Tanshel Pointer/NY/FRS@FRS
Where
Location: Board Room
If your schedule allows, please feel free to attend this meeting.
BOG-- FOIA 10-251 --000124

From: Donald L Kohn
To: Kevin Warsh
Subject: AIG
Date: 09/13/2008 03:42 PM
please call re my call with Frenkel and Willumsted
BOG-- FOIA 10-251 --000125

Meeting Update Request:
Calendar Entry
Subject: AIG Update
When
Time: 04:00 PM - 05:00 PM (1 hour)
Chair: Kristin Mayer
Invitees
Required (to): Adam Ashcraft/NY/FRS@FRS; Alejandro LaTorre/NY/FRS@FRS; Arthur Angulo/NY/FRS@FRS; Beverly
Hirtle/NY/FRS@FRS; Brian Peters/NY/FRS@FRS; Calvin Mitchell/NY/FRS@FRS; Catherine Voigts/NY/FRS@FRS;
Chris Burke/NY/FRS@FRS; Chris McCurdy/NY/FRS@FRS; Hayley Boesky/NY/FRS@FRS; Helen
Mucciolo/NY/FRS@FRS; Jamie McAndrews/NY/FRS@FRS; Jeanmarie Davis/NY/FRS@FRS; Jim
Mahoney/NY/FRS@FRS; Joyce Hansen/NY/FRS@FRS; Lawrence Radecki/NY/FRS@FRS; Lucinda M
Brickler/NY/FRS@FRS; Meg McConnell/NY/FRS@FRS; Michael Schetzel/NY/FRS@FRS; Patricia
Mosser/NY/FRS@FRS; Patrick M Parkinson/BOARD/FRS@BOARD; Richard Charlton/NY/FRS@FRS; Richard
Dzina/NY/FRS@FRS; Sandy Krieger/NY/FRS@FRS; Sarah Bell/NY/FRS@FRS; Sarah Dahlgren/NY/FRS@FRS;
Simon Potter/NY/FRS@FRS; Steven J Manzari/NY/FRS@FRS; Terrence Checki/NY/FRS@FRS; Theodore
Lubke/NY/FRS@FRS; Thomas Baxter/NY/FRS@FRS; Til Schuermann/NY/FRS@FRS; Timothy
Geithner/NY/FRS@FRS; Tobias Adrian/NY/FRS@FRS; Warren Hrung/NY/FRS@FRS; Wendy Ng/NY/FRS@FRS;
William BRODOWS/NY/FRS@FRS; William Dudley/NY/FRS@FRS; William Rutledge/NY/FRS@FRS; William
Walsh/NY/FRS@FRS
Optional (cc): Alexandra Merle-Huet/NY/FRS@FRS; Bettyann Griffith/NY/FRS@FRS; Daniel Boulos/NY/FRS@FRS; Marlene
Williams/NY/FRS@FRS; Michael Held/NY/FRS@FRS; Michael Silva/NY/FRS@FRS; Tanshel Pointer/NY/FRS@FRS
Where
Location: Board Room
If your schedule allows, please feel free to attend this meeting.
Dial-in Info:
Number: 888-557-8511
Access Code: 8785192
BOG-- FOIA 10-251 --000126

From: Donald L Kohn
To: (b) (6) Timothy Geithner; Kevin Warsh
Cc: Scott Alvarez; brian.f.madigan@frb.gov
Subject: AIG
Date: 09/13/2008 03:54 PM
Strange conversation. Willumsted (sp?) and Frenkel didn't seem to be aware of the
captial raise/ asset sale plan Kevin told Ben about, and of course I didn't say
anything. I told them we were "very reluctant" to open up our discount window to
them when it wasn't clear they had a good plan for getting enough capital into the
company and were depending on asset sales over along period. I said we also were
aware that we would begiving a whole new class or classes of borrowers under our
discount window umbrella. They said they had prospects for 10 b of immediate
private equity and maybe about 10 b of new liquidity from convincing dinallo to
allow them to do some sec lending from the insurance companies to the HC. they
needed 20 from us to buy time to sell selected assets, like interests in their
insurance companies. I told them to make plans as if we wouldn't be there for
them, but also to keep in touch. they seemed to think they had a week or so--
though the next few days would be tough. (b) (5)

BOG-- FOIA 10-251 --000127

From: (b) (6)
To: Donald L Kohn
Cc: brian.f.madigan@frb.gov; Kevin Warsh; Scott Alvarez; Timothy Geithner
Subject: Re: AIG
Date: 09/13/2008 03:57 PM
Maybe they are playing their cards close to the vest.

Donald L
Kohn/BOARD/FRS
To (b) (6) Timothy
Geithner/NY/FRS@FRS, Kevin
09/13/2008 03:54 PM cc Scott Alvarez/BOARD/FRS@BOARD,
brian.f.madigan@frb.gov
Subject AIG
Duplicate
BOG-- FOIA 10-251 --000128

From: Tobias Adrian
To: Michael S Gibson; Adam Ashcraft; Christopher Calabia
Cc: Joshua Rosenberg
Subject: AIG Financial System Risk Evaluation.doc
Date: 09/13/2008 04:00 PM
Attachments: AIG Financial System Risk Evaluation.doc
Here is a note on AIG's financial system risk.
I will add more explanations later in the day.
Tobias

-------------------------------------------------------------------
Tobias Adrian
Tel: (212) 720-1717
------------------------------------------------------------------
- AIG Financial System Risk Evaluation.doc
BOG-- FOIA 10-251 --000129

(b) (5)
(b) (5)
1
BOG-- FOIA 10-251 --000130
(b) (5)
2
BOG-- FOIA 10-251 --000131
(b) (5)
3
BOG-- FOIA 10-251 --000132
(b) (5)
BOG-- FOIA 10-251 --000133

(b) (5)
BOG-- FOIA 10-251 --000134

From: Scott Alvarez
To: Donald L Kohn
Cc: brian.f.madigan@frb.gov (b) (6) Kevin Warsh; Timothy Geithner
Subject: Re: AIG
Date: 09/13/2008 04:04 PM
(b) (5)
Scott
Donald L
Kohn/BOARD/FRS
To (b) (6) Timothy
Geithner/NY/FRS@FRS, Kevin
09/13/2008 03:54 PM cc Scott Alvarez/BOARD/FRS@BOARD,
brian.f.madigan@frb.gov
Subject AIG
Duplicate
BOG-- FOIA 10-251 --000135

To: Roberto Perli
Subject: consequences
Date: 09/13/2008 04:27 PM
(b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000136

To: William B English; James A Clouse
Subject: what is this, a joke?
Date: 09/13/2008 04:29 PM
(b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000137

To: William R Nelson
Cc: William B English
Subject: Re: what is this, a joke?
Date: 09/13/2008 04:34 PM
Only for someone with a very dark sense of humor!
jclouse@frb.gov
cell: 703-304-6276
▼ William R Nelson/BOARD/FRS
William R
Nelson/BOARD/FRS
To William B English/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD
cc
09/13/2008 04:29 PM
Subject what is this, a joke?
Duplicate
BOG-- FOIA 10-251 --000138

To: Brian F Madigan
Subject: a key question
Date: 09/13/2008 05:08 PM
(b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000139

To: Brian F Madigan; James A Clouse; William R Nelson; Roberto Perli; Antoinette Gibson; Jon D Greenlee; William
B English
Subject: Partial memo draft
Date: 09/13/2008 05:27 PM
Attachments: AIG memo v2.doc
Binder1.pdf
Attached is a rough draft of the first part of our memo. I was not sure where to
stop, so I put in some discussion of the current problems (which may overlap with
Jon's discussion of liquidity in the second section) and of the possible spillovers
(which may overlap with the Nelson/Clouse discussion of the pros and cons of
lending).
(b) (5)
Comments very welcome,

Bill E.
BOG-- FOIA 10-251 --000140

(b) (5)
BOG-- FOIA 10-251 --000141

(b) (5)
BOG-- FOIA 10-251 --000142

(b) (5)
BOG-- FOIA 10-251 --000143

(b) (5)
BOG-- FOIA 10-251 --000144

(b) (5)
BOG-- FOIA 10-251 --000145

(b) (5)
BOG-- FOIA 10-251 --000146



2008 2007
Assets:
$393,170) $ 393,316 $ 397,372
Equity securities:
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
2008 – $36; 2007 – $233) 33,311 31,234
Cash 2,229 2,284
$5,446) 5,692 5,518
Goodwill 10,661 9,414
Total assets $1,049,876 $1,048,361
1 BOG-- FOIA 10-251 --000147


2008 2007
Liabilities:
$8,338) 9,659 8,331
value: 2008 – $240) 6,165 4,903
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
2 BOG-- FOIA 10-251 --000148


2008 2007 2008 2007
Revenues:
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000149

Segment Results
The following table summarizes the operations of each principal segment: (See also Note 2 to Consolidated Financial
Statements.)
Three Months Ended Percentage Six Months Ended Percentage
Operating Segments June 30, Increase/ June 30, Increase/
(in millions) 2008 2007 (Decrease) 2008 2007 (Decrease)
Total revenues(a):
General Insurance $ 12,757 $12,928 (1)% $ 25,046 $25,831 (3)%
Life Insurance & Retirement Services(b) 10,161 14,023 (28) 18,913 27,705 (32)
Financial Services(c)(d) (3,605) 2,123 — (10,165) 4,324 —
Asset Management(e) 797 1,781 (55) 648 3,450 (81)
Other 208 263 (21) 80 394 (80)
Consolidation and eliminations (385) 32 — (558) 91 —
Total $ 19,933 $31,150 (36)% $ 33,964 $61,795 (45)%
Operating income (loss)(a):
General Insurance $ 827 $ 2,976 (72)% $ 2,164 $ 6,072 (64)%
Life Insurance & Retirement Services(b) (2,401) 2,620 — (4,232) 4,901 —
Financial Services(c)(d) (5,905) 47 — (14,677) 339 —
Asset Management(e) (314) 927 — (1,565) 1,685 —
Other (715) (460) — (1,483) (930) —
Total $ (8,756) $ 6,328 — $(20,020) $12,500 —%
(a) Includes other-than-temporary impairment charges of $6.8 billion and $417 million for the three-month periods ended June 30, 2008 and 2007,
respectively, and $12.4 billion and $884 million for the six-month periods ended June 30, 2008 and 2007, respectively. Also includes gains (losses) from
hedging activities that did not qualify for hedge accounting treatment under FAS No. 133, ‘‘Accounting for Derivative Instruments and Hedging Activities’’
(FAS 133), including the related foreign exchange gains and losses. For the three-month periods ended June 30, 2008 and 2007, the effect was $272 million
and $(430) million, respectively, in both revenues and operating income (loss). For the six-month periods ended June 30, 2008 and 2007, the effect was
$(476) million and $(882) million, respectively, in both revenues and operating income (loss). These amounts result primarily from interest rate and foreign
currency derivatives that are effective economic hedges of investments and borrowings.
(b) Includes other-than-temporary impairment charges of $5.2 billion and $324 million for the three-month periods ended June 30, 2008 and 2007,
respectively, and $9.6 billion and $716 million for the six-month periods ended June 30, 2008 and 2007, respectively.
(c) Includes gains (losses) from hedging activities that did not qualify for hedge accounting treatment under FAS 133, including the related foreign exchange
gains and losses. For the three-month periods ended June 30, 2008 and 2007, the effect was $5 million and $(443) million, respectively, in both revenues and
operating income (loss). For the six-month periods ended June 30, 2008 and 2007, the effect was $(199) million and $(603) million, respectively, in both
revenues and operating income (loss). These amounts result primarily from interest rate and foreign currency derivatives that are effective economic hedges
of investments and borrowings.
(d) For the three- and six-month periods ended June 30, 2008, both revenues and operating income (loss) include unrealized market valuation losses of
$5.6 billion and $14.7 billion, respectively, on AIGFP’s super senior credit default swap portfolio. BOG-- FOIA 10-251 --000150
(e) Includes net realized capital losses of $464 million and $1.9 billion for the three- and six-month periods ended June 30, 2008, respectively, including other-
than-temporary impairment charges of $882 million and $1.9 billion, respectively.
From: Warren Hrung
To: Adam Ashcraft; Alejandro LaTorre; Arthur Angulo; Beverly Hirtle; Brian Peters; Calvin Mitchell; Catherine
Voigts; Chris Burke; Chris McCurdy; Hayley Boesky; Helen Mucciolo; Jamie McAndrews; Jeanmarie Davis; Jim
Mahoney; Joyce Hansen; Lawrence Radecki; Lucinda M Brickler; Meg McConnell; Michael Schetzel; Patricia
Mosser; Patrick M Parkinson; Richard Charlton; Richard Dzina; Sandy Krieger; Sarah Bell; Sarah Dahlgren;
Simon Potter; Steven J Manzari; Terrence Checki; Theodore Lubke; Thomas Baxter; Til Schuermann; Timothy
Geithner; Tobias Adrian; Warren Hrung; Wendy Ng; William BRODOWS; William Dudley; William Rutledge;
William Walsh
Subject: Merrill report on AIG
Date: 09/13/2008 05:35 PM
Attachments: ML-S&P on AIG.pdf
This gives some insight into what S&P is thinking. S&P has a more optimistic view
than AIG on credit losses. This is about the fact that things aren't turning around
fast enough, leaving bond holders to risk.
Warren B. Hrung
Markets Group
(212) 720 - 6054
BOG-- FOIA 10-251 --000151

(b) (4)
BOG-- FOIA 10-251 --000152

(b) (4)
BOG-- FOIA 10-251 --000153

(b) (4)
BOG-- FOIA 10-251 --000154

(b) (4)
BOG-- FOIA 10-251 --000155

(b) (4)
BOG-- FOIA 10-251 --000156

(b) (4)
BOG-- FOIA 10-251 --000157

(b) (4)
BOG-- FOIA 10-251 --000158

(b) (4)
BOG-- FOIA 10-251 --000159

(b) (4)
BOG-- FOIA 10-251 --000160

(b) (4)
BOG-- FOIA 10-251 --000161

From: Warren Hrung
Cc: Adam Ashcraft
Subject: AIG CDS exposure
Date: 09/13/2008 05:45 PM
Mike,
Just to check my numbers, from the file below, (b) (5)
Warren
Warren B. Hrung
Markets Group
(212) 720 - 6054
BOG-- FOIA 10-251 --000162

Subject: Re: Rough cut at a liquidity section
Date: 09/13/2008 05:58 PM
Haven't seen anything. I went home around 4. I'm not sure exactly
what they are doing, but I faxed a bunch of insurance info from AM
Best.
Jon
--------------------------

Sent: 09/13/2008 05:27 PM EDT
To: Jon Greenlee
Subject: Re: Rough cut at a liquidity section
Jon,
I was offline for a couple hours - anything new on the solvency

analysis from NY since the 2pm call?
Mike
▼ Jon D Greenlee

Sent: 09/13/2008 01:01 PM EDT
To: Michael Gibson; Christopher Calabia
Subject: Rough cut at a liquidity section
[attachment "AIG Funding and Liquidity Needs.doc" deleted by Michael

S Gibson/BOARD/FRS]
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000163

F om M chael S Gibson@f b gov
To f
Cc Adam Ashc aft@ny f b o g
Subject Re AIG CDS exposu e
Da e 09/13/2008 06 15 M
(b) (5)
Mike
Warren
Hrung N FRS@FRS o Michael S
Gibson Boa d RS@BOARD
09 3 2008 05 45 M
cc Adam
Ashc a t N RS@ RS
Sub ect AIG CDS exposu e Link
Mike,
Just to check my numbers
(b) (5)
Warren
Warren B. Hrung
Analytical Deve opment
Markets Group
(212) 720 - 605
BOG-- FOIA 10-251 --000164

Subject: Fw: AIG Financial System Risk Evaluation.doc
Date: 09/13/2008 06:17 PM
Attachments: AIG Financial System Risk Evaluation.doc
Bill, I believe you asked about this on the 2pm call.
Mike
----- Forwarded by Michael S Gibson/BOARD/FRS on 09/13/2008 06:17 PM -----
Tobias
Adrian/NY/FRS@FRS
To Michael S Gibson/BOARD/FRS@BOARD, Adam
Ashcraft/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS
09/13/2008 04:00 PM cc Joshua Rosenberg/NY/FRS@FRS
Subject AIG Financial System Risk Evaluation.doc
Here is a note on AIG's financial system risk.
I will add more explanations later in the day.
Tobias

-------------------------------------------------------------------
Tobias Adrian
Tel: (212) 720-1717
------------------------------------------------------------------
- AIG Financial System Risk Evaluation.doc Document is a duplicate
BOG-- FOIA 10-251 --000165

Cc: Pat White
Subject: question
Date: 09/13/2008 06:25 PM
(b) (5)
MG
BOG-- FOIA 10-251 --000166

To: William BRODOWS
Cc: Mike Gibson; Pat White
Subject: Fw: question
Date: 09/13/2008 06:27 PM
Bill, can you help Mike out? Pat


Sent: 09/13/2008 06:25 PM EDT
Cc: Pat White
Duplicate
BOG-- FOIA 10-251 --000167

From: William BRODOWS
Cc: Michael S Gibson; Pat White
Subject: Re: question
Date: 09/13/2008 06:29 PM
I will contact mike after this meeting.

----------------------------------------
Sent from my BlackBerry Handheld.

From: Patrick.M.Parkinson
Sent: 09/13/2008 06:27 PM AST
To: William BRODOWS
Cc: Michael Gibson; Pat White
Subject: Fw: question
Duplicate
BOG-- FOIA 10-251 --000168

To: Brian F.Madigan; Scott Alvarez; Deborah Bailey; Jon Greenlee; Mike Gibson
Subject: Fw: AIG update
Date: 09/13/2008 07:40 PM
Apologies I meant to include you in the distribution. . Please ignor Richard's replky
and go to the message below. Elise will be in touch so we have all the right
insurance experts involved in any call with them.
-----------------------------
Patricia C. Mosser, FRB-NY
▼ Richard Charlton

From: Richard Charlton
Sent: 09/13/2008 07:32 PM EDT
To: Patricia Mosser; Elise Liebers
Subject: Re: AIG update
Pls include me as well--I'll plan to be down here by 9, unless you tell
me otherwise, but will need to know where to go and when, and to be
let on to the Markets floor, if there isn't someone at the front door.
Thanks.
▼ Patricia Mosser/NY/FRS
Patricia
Mosser/NY/FRS
09/13/2008 07:26 PM Voigts/NY/FRS@FRS, Adam Ashcraft/NY/FRS@FRS,
Michael Schetzel/NY/FRS,
christine.cumming@ny.frb.org, William Dudley/NY/FRS,
Terrence Checki/NY/FRS, Elise Liebers/NY/FRS, Meg
McConnell/NY/FRS@FRS, William
Rutledge/NY/FRS@FRS@NY, Brian Peters/NY/FRS
cc
Subject AIG update
2 conversations this afternoon with AIG and NYSID:
AIG:
Frenkel spoke with Kohn , who urged AIG to continue to pursue
private sector solutions and asset sales. Noted continued reluctance
to do 13-3 lending.
AIG has put together a term sheet for NYSID , which they will be
discussing this evening. The term sheet would outline all pieces of
liquidity plan, and plans for debt and equity injections , plans for asset
sales as well as regulatory forebearance to move assets from subs to
parent.
AIG asked our views on whether and how to inform Treasury

department of their situation. (b) (5)
BOG-- FOIA 10-251 --000169

(b) (5)
NYSID:
(b)(4), (b)(5), & (b)(8)
Elise, are you and your team available to talk with Dinallo's staff after
9 am tomorrow? Also, could you please coordinate with Board BS&R
about their availability?
BOG-- FOIA 10-251 --000170

Cc: Michael S Gibson; Brian F Madigan; James A Clouse; Jon D Greenlee; Roberto Perli; Scott Alvarez; Deborah P
Bailey
Subject: Re: Partial memo draft
Date: 09/13/2008 07:43 PM
Attachments: aig ipc draft.doc
(b) (5)
I'm not sure who will be collecting comments and improvements, but I'm happy to.
I'm heading home now, but will check my email a bit later. I'll be in tomorrow
morning.
Bill N.
Office: 202-452-3579
Mobile: 703-340-4542
William B
English/BOARD/FRS
To Brian F Madigan/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD, William R
Nelson/BOARD/FRS@BOARD, Roberto
09/13/2008 05:27 PM Perli/BOARD/FRS@BOARD, Antoinette
Gibson/BOARD/FRS@BOARD, Jon D
Greenlee/BOARD/FRS@BOARD, William B
English/BOARD/FRS@BOARD
cc
Subject Partial memo draft
Duplicate
BOG-- FOIA 10-251 --000171

(b) (5)
BOG-- FOIA 10-251 --000172

(b) (5)
BOG-- FOIA 10-251 --000173

(b) (5)
BOG-- FOIA 10-251 --000174

(b) (5)
BOG-- FOIA 10-251 --000175

(b) (5)
BOG-- FOIA 10-251 --000176

(b) (5)
BOG-- FOIA 10-251 --000177

(b) (5)
BOG-- FOIA 10-251 --000178

(b) (5)
BOG-- FOIA 10-251 --000179

(b) (5)
BOG-- FOIA 10-251 --000180

To: William B English; Michael S Gibson; Brian F Madigan; James A Clouse; Jon D Greenlee; Roberto Perli
Date: 09/13/2008 09:27 PM
Attachments: AIG memo v2.mg.doc
Bill,
I added some details, especially on the derivatives stuff.
Mike
William B
English/BOARD/FRS
To Michael S Gibson/BOARD/FRS@BOARD
cc
09/13/2008 05:32 PM Subject Partial memo draft
Duplicate
BOG-- FOIA 10-251 --000181

(b) (5)
BOG-- FOIA 10-251 --000182

(b) (5)
BOG-- FOIA 10-251 --000183

(b) (5)
BOG-- FOIA 10-251 --000184

(b) (5)
BOG-- FOIA 10-251 --000185

(b) (5)
BOG-- FOIA 10-251 --000186

(b) (5)
BOG-- FOIA 10-251 --000187

(b) (5)
BOG-- FOIA 10-251 --000188

(b) (5)
BOG-- FOIA 10-251 --000189

From: Diane Fraser
To: Jon D Greenlee; Sabeth I Siddique
Cc: Elise Liebers; Diane.Fraser@frb.gov; Adrienne Haden
Subject: AIG Org. w/ assets + other info in advance of call w/ NY State Insurance Dept. tomorrow a.m.
Date: 09/13/2008 10:28 PM
Attachments: American International Group SNL Corp.Structure Report (9-08).doc
FYI - In general, state insurance statutes allow commercial insurance underwriters to pay out
a maximum dividend amount of the greater of (1) the prior year-end net income, or (2) 10%
of the surplus as regards policyholders, without the approval of the state’s insurance
regulatory authority. State insurance regulatory authorities have the power to approve
extraordinary dividends on a case-by-case basis.
Attached below is a tiering report showing the corporate structure for American International
Group, Inc. (AIG). As you will see, AIG has many subsidiaries.
----- Forwarded by Diane Fraser/BOARD/FRS on 09/13/2008 10:16 PM -----
Diane.Fraser@frb.gov
To Jon.D.Greenlee@frb.gov
cc Deborah.P.Bailey@frb.gov, Adrienne.Haden@frb.gov,
09/13/2008 09:04 PM Elise.Liebers@ny.frb.org, Diane.Fraser@frb.gov
Subject Conference call w/ NY State Insurance Dept. re: AIG is
being planned for tomorrow a.m. by FRB-NY
Jon,
Elise and I have spoken and FRB-NY will keep us informed about the time of the
conference call.
Diane
Jon.D.Greenlee@frb.gov
To "Diane Fraser" <Diane.Fraser@frb.gov>

09/13/2008 08:06 PM
cc "Ms. Deborah P Bailey" <Deborah.P.Bailey@FRB.Gov>, "Adrienne Haden"
<Adrienne.Haden@frb.gov>
Subject Fw: AIG update
Diane,
Can you get in touch with Elise and see if what she may need from us or
possibly Boston?
Thanks
BOG-- FOIA 10-251 --000190

Jon
--------------------------
Duplicate
BOG-- FOIA 10-251 --000191

(b) (4)
BOG-- FOIA 10-251 --000192

(b) (4)
BOG-- FOIA 10-251 --000193

(b) (4)
BOG-- FOIA 10-251 --000194

(b) (4)
BOG-- FOIA 10-251 --000195

(b) (4)
BOG-- FOIA 10-251 --000196

(b) (4)
BOG-- FOIA 10-251 --000197

(b) (4)
BOG-- FOIA 10-251 --000198

(b) (4)
BOG-- FOIA 10-251 --000199

(b) (4)
BOG-- FOIA 10-251 --000200

(b) (4)
BOG-- FOIA 10-251 --000201

Date: 09/13/2008 10:39 PM
Ok. No,bi did'pn't

Office: 202-452-3579
Mobile: 202-725-3612
▼ William B English

Sent: 09/13/2008 10:37 PM EDT
To: William Nelson
Bill-
I will be in tomorrow about noon, I think. If you are in before that,

you could incorporate Mike's comments, all of which are fine, into your
version of the document. If you don't get in before I do, I can do it
when I get in. Did you make any changes to my version after the
intro and before the part on lending? Let's try to avoid a version
control problem if we can!
Thanks,
Bill E.
William R
Nelson/BOARD/FRS
cc Michael S Gibson/BOARD/FRS@BOARD, Brian F
Madigan/BOARD/FRS@BOARD, James A
09/13/2008 07:43 PM Clouse/BOARD/FRS@BOARD, Jon D
Greenlee/BOARD/FRS@BOARD, Roberto
Perli/BOARD/FRS@BOARD, Scott
Alvarez/BOARD/FRS@BOARD, Deborah P
Subject
Re: Partial memo draft
Duplicate
BOG-- FOIA 10-251 --000202

To: Brian F Madigan
Subject: Re: a key question
Date: 09/14/2008 04:35 AM
(b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
Brian F
Madigan/BOARD/FRS
To William R Nelson/BOARD/FRS@BOARD
cc
09/13/2008 05:35 PM Subject
Re: a key question
Bill,
(b) (5)
Brian
William R
Nelson/BOARD/FRS
cc
09/13/2008 05:08 PM Subject a key question
Duplicate
BOG-- FOIA 10-251 --000203

To: William Walsh
Subject: Fw: Failure of an insurance company
Date: 09/14/2008 04:43 AM
Attachments: naicfrs.pdf
Hi Bill. Is this the study? Sorry I overlooked your email earlier.
--Bill
Office: 202-452-3579
Mobile: 703-340-4542
----- Forwarded by William R Nelson/BOARD/FRS on 09/14/2008 04:40 AM -----
Jon D
Greenlee/BOARD/FRS
To William B English/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD, William R
Nelson/BOARD/FRS@BOARD, Michael S
09/13/2008 12:55 PM Gibson/BOARD/FRS@BOARD, Deborah P
cc
Subject Failure of an insurance company
Here is a paper that some of my staff worked on a few years ago that draws the
comparison between resolving a bank and an insurance company. There have been
failures in the past (Equitable for example) and I am working to get additional info
on those situations that might be helpful.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000204

Report of the National Association of Insurance Commissioners (NAIC) and
the Federal Reserve System
Joint Troubled Company Subgroup
A Comparison of the
Insurance and Banking Regulatory Frameworks
for Identifying and Supervising Companies in
Weakened Financial Condition
April 19, 2005

For Information Only
This report was prepared for the NAIC’s Financial Condition (E) Committee and for the
Federal Reserve System by the following Subgroup Members:
Steve Johnson, Pennsylvania Insurance Department Barbara Cornyn, Federal Reserve Board
Bob Dynan, Massachusetts Division of Insurance Cynthia Martin, Federal Reserve Bank of Boston
Jim Armstrong, Iowa Division of Insurance
Wayne Johnson, Florida Department of Financial Services
Randy Blumer, Wisconsin Office of Commissioner of Insurance
Roger Peterson, Wisconsin Office of Commissioner of Insurance
Doug Hartz, NAIC Legal
Jeff Johnston, NAIC Financial Regulatory Services
David Vacca, NAIC Financial Regulatory Services
This document is a working paper composed by staff of the state insurance departments, the NAIC
and the Federal Reserve System participating on the NAIC and Federal Reserve System’s joint
Troubled Company Subgroup and does not necessarily express any official views of the state
insurance departments, the NAIC or the Federal Reserve System.
BOG-- FOIA 10-251 --000205

This page is intentionally left blank for printing purposes.
BOG-- FOIA 10-251 --000206

TABLE OF CONTENTS
Topic Page
Introduction -------------------------------------------------------------------------------------------------- 1
Background on the Gramm-Leach-Bliley Act (GLB Act) -------------------------------------------- 3
Overview of Frameworks for Supervising Insurance and Banking Organizations----------------- 5
Insurance ---------------------------------------------------------------------------------------------- 5
Banking ----------------------------------------------------------------------------------------------- 8
Tools for Identifying Financially Weakened Companies---------------------------------------------10
Insurance ---------------------------------------------------------------------------------------------10
Financial Reporting -----------------------------------------------------------------------10
Solvency Screening and Financial Analysis Systems--------------------------------11
State Insurance Department Financial Examination Process --------------------- 13
Regulatory Capital Framework for Insurance Companies --------------------------14
Databases and Information Systems ---------------------------------------------------15
Banking (State Member Banks and Bank Holding Companies) -----------------------------16
Financial Reporting-----------------------------------------------------------------------16
Surveillance and Monitoring ------------------------------------------------------------16
Bank Examinations and BHC Inspections --------------------------------------------17
Regulatory Capital Frameworks --------------------------------------------------------18
Databases and Information Systems ---------------------------------------------------20
Approaches for Supervising a Financially Weakened Company ------------------------------------21
State Insurance Departments ----------------------------------------------------------------------21
Federal Reserve System ---------------------------------------------------------------------------22
Receivership and Liquidation ----------------------------------------------------------------------------24
State Insurance Supervisors -----------------------------------------------------------------------24
Bank Supervisors ---------------------------------------------------------------------------------- 25
Conclusion --------------------------------------------------------------------------------------------------26
Summary of State Regulation for Identifying and Supervising Financially
Weakened Insurers --------------------------------------------------------------------- Appendix A
Summary of Framework for Identifying and Supervising Financially Weakened State
Member Banks and Bank Holding Companies ------------------------------------- Appendix B
BOG-- FOIA 10-251 --000207

INTRODUCTION
The National Association of Insurance Commissioners (NAIC) and the Federal Reserve
System (FRS) joint Troubled Company Subgroup (Subgroup) was formed in 2000.1 The
Subgroup’s objective was to compare insurance and banking regulatory frameworks for
identifying and supervising companies in weakened financial condition, and was one of
four joint subgroups established by the NAIC and the FRS to address implementation of
the Gramm-Leach-Bliley Act (GLB Act) enacted in November 1999.2 The GLB Act
facilitated the already growing integration of the insurance, banking and securities sectors
by permitting wider latitude for insurance companies, banks and securities firms to
operate within a single financial holding company (FHC), and mandated the coordinated
supervision of entities within an FHC by the financial sector regulators. The joint efforts
of the insurance and banking supervisors over the past several years have provided a
foundation for effective communication and coordination between the state insurance
departments and the FRS consistent with the GLB Act.
Topics presented and discussed by Subgroup members and guest speakers included: 1)
regulatory financial reporting frameworks; 2) off-site surveillance and monitoring
including “early warning systems” for identifying supervised companies having weak or
deteriorating financial conditions; 3) on-site examinations; 4) corrective action plans; 5)
enforcement powers; 6) risk-based capital (RBC) frameworks; 7) resolution processes for
failing and failed insurance companies and banks; and 8) the FRS’s role as umbrella
supervisor for FHCs. Separately, in connection with this initiative, staff of the Federal
Deposit Insurance Corporation (FDIC) presented a summary of that agency’s resolution
procedures to the NAIC task force members. In comparing the two frameworks of law,
regulation, policy and procedures, the Subgroup members and other discussants stressed
that the specific supervisory approaches taken for any given financially weakened
insurance or banking company are dependent upon the specific facts and circumstances
as well as upon the respective supervisory frameworks.
The Subgroup found that the frameworks for identifying and supervising financially
weakened companies used by state insurance regulators and the FRS have many
similarities. For example, both the state insurance departments and the FRS:
1
The Subgroup’s initiative was conducted by staff from several state insurance departments, the NAIC, the
Board of Governors of the Federal Reserve System (Federal Reserve Board) and the Federal Reserve Bank
of Boston under the auspices of the NAIC’s Financial Condition (E) Committee. The Subgroup, which was
originally established under the NAIC Coordinating with Federal Regulators Working Group now reports
up through the NAIC Financial Analysis Working Group (FAWG) of the NAIC Financial Condition (E)
Committee.
2
Unless otherwise noted, the banking supervisory framework presented in this paper is the approach used
by the FRS as it pertains to state member banks and bank holding companies (BHCs). The FRS also has
supervisory responsibility for certain U.S. bank branches and certain other U.S. banking offices of foreign
banking organizations (FBOs); however, the scope of this summary does not include FBO supervision.
Additionally, the scope of this summary was generally limited to financial soundness monitoring and the
supervision of financially weakened institutions. Comparisons of frameworks for identifying and
correcting issues pertaining to compliance with consumer protection regulations were also beyond the
scope of this summary.
1
BOG-- FOIA 10-251 --000208
• generally require supervised institutions to file detailed quarterly financial
condition and income reports, related supplementary information, and
information identifying affiliated entities of an insurer or a bank;
• conduct routine off-site monitoring of supervised companies other than small,
noncomplex BHCs, in part based upon information contained in regulatory
reports, and also using market information, to assist in early identification of
financially weakened companies and in allocating on-site examination
resources;
• have minimum capital standards, including an RBC framework that requires
regulatory intervention when capital of a supervised insurance company or
insured bank falls below a designated level;3
• impose limitations on and reporting requirements related to certain
transactions within holding company systems, including certain acquisitions
of or by a supervised entity;
• may require a financially weakened, supervised company to develop written
corrective action plans and submit progress reports on compliance with plans;
and
• may take various other supervisory actions against a financially weakened
company, including imposing restrictions on activities.
The Subgroup also identified three broad phases of supervisory activities as follows:
1) conducting both off-site monitoring of financial condition using financial

statement and market information analysis, and on-site examinations;
2) implementing corrective action plans for financially weakened companies; and
3) undertaking insolvency proceedings (generally the responsibility of the FDIC

for bank insolvencies).
The attached Appendices A and B contain summary information regarding the insurance
and banking regulatory processes for identifying and supervising financially weakened
insurance and banking organizations.
3
State insurance departments and certain bank regulators are responsible for handling insurance company
and bank insolvencies, respectively; insolvencies of insurance holding companies and BHCs are handled
under federal bankruptcy laws.
2
BOG-- FOIA 10-251 --000209
BACKGROUND ON THE GLB ACT
The GLB Act amendments to the Bank Holding Company Act of 1956 (BHC Act)
authorized a qualifying bank holding company (BHC) to operate as an FHC and to
engage in a diversified range of financial activities, including insurance sales, insurance
underwriting, securities underwriting and dealing, acting as a futures commission
merchant, and engaging in merchant banking. To qualify as an FHC, each of the BHC's
depository institution subsidiaries must be well capitalized and well managed and each of
the BHC’s insured depository subsidiaries must have received at least a “Satisfactory”
Community Reinvestment Act (CRA) rating in its most recent CRA examination.4
Those insurance activities that are permitted to be conducted by an FHC include insuring,
guaranteeing, or indemnifying against loss, harm, damage, illness, disability, or death;
providing and issuing annuities; and acting as principal, agent, or broker for the foregoing
activities. Permissible activities also include those that the Federal Reserve Board and
the Secretary of Treasury jointly determine to be financial in nature or incidental to
financial activities, or that the Federal Reserve Board determines are complementary to a
financial activity and do not pose a substantial risk to the safety and soundness of
depository institutions or the financially system generally.
Under the GLB Act, state regulation of insurance is preserved. A state law applicable to
insurance may be preempted, however, if it prevents or restricts a depository institution
or a depository institution affiliate from engaging in any activity authorized under the
GLB Act. For instance, state laws relating to insurance sales, solicitation and cross-
marketing activities may not prevent or significantly interfere with the ability of a bank or
bank affiliate to engage in insurance sales activities.
With limited exceptions that existed prior to the passage of the GLB Act, insurance
underwriting activities of an FHC may only be conducted by the FHC parent company or
by a nonbank subsidiary of the FHC. A bank and its subsidiaries are generally precluded
from insurance underwriting, other than the underwriting of credit life and credit health
products. As set forth in the GLB Act, general insurance sales may be conducted by an
FHC parent company or a nonbank subsidiary of the FHC, or by a financial subsidiary of
a bank. The GLB Act did not change the authority for national or state-chartered banks
to sell or underwrite insurance directly. Federal banking laws, however, generally
continue to limit insurance underwriting activities of banks to credit-related underwriting
activities. Most state banking laws now permit state-chartered banks to sell general
insurance.
The Federal Reserve Board is the umbrella supervisor of BHCs, including FHCs. In
accordance with the GLB Act, the Federal Reserve Board is to rely to the fullest extent
possible on reports of examination made by the applicable functional securities and
4
A CRA rating is an indicator of how well the depository institution has met its legal requirement to serve
its community, in accordance with applicable laws and regulations. CRA examinations are conducted by a
depository institution’s primary federal banking regulator.
3
BOG-- FOIA 10-251 --000210
insurance regulators, including for any licensed insurance company and any other
subsidiary that the Federal Reserve Board finds to be comprehensively supervised by a
federal or state authority. If information that is needed to assess the risk of a functionally
regulated subsidiary of a banking organization is not available from the functional
regulator, the Federal Reserve Board may examine a functionally regulated subsidiary of
a BHC only if: the Federal Reserve Board has reasonable cause to believe that such
subsidiary is engaged in activities that pose a material risk to an affiliated depository
institution; the Federal Reserve Board reasonably determines, after reviewing relevant
reports, that examination of the subsidiary is necessary to adequately inform the Board of
the systems for monitoring and controlling operational risks that may pose a threat to the
safety and soundness of a depository institution subsidiary of the BHC; or, based on
reports and other available information, the Federal Reserve Board has reasonable cause
to believe that the subsidiary is not in compliance with the GLB Act or any other federal
law that the Federal Reserve Board has jurisdiction to enforce against such subsidiary,
and the Federal Reserve Board cannot make such a determination through examination of
the affiliated depository institution or the bank holding company.
4
BOG-- FOIA 10-251 --000211
OVERVIEW OF FRAMEWORKS FOR SUPERVISING INSURANCE AND
BANKING ORGANIZATIONS
Insurance
The primary objective of insurance regulation is to correct market failures that would
otherwise cause insurers to incur an excessive risk of insolvency or engage in market
abuses that hurt consumers. Significant state insurance department regulatory resources
are employed to monitor market behaviors, compliance, and solvency.
Each state, the District of Columbia, and the U.S. territories5 are responsible for
regulating the insurance business within their own jurisdictions. Each state maintains its
own insurance department, which operates under the supervision of a commissioner,
director, or superintendent who is either appointed or elected. Some states have
combined the regulation of insurance, banking, and securities, activities under one
department or office.
The NAIC, formed in 1871, is a private, non-profit, voluntary association of the chief
insurance regulatory officials of the 50 states, the District of Columbia, and the four U.S
territories (American Samoa, Guam, Puerto Rico, and the Virgin Islands). The NAIC
provides its members with a forum for discussing common interests and for working
cooperatively on regulatory matters that transcend the boundaries of their own
jurisdictions. The NAIC is not a regulatory body or a trade association, but is instead an
organization whose members consist solely of insurance regulators for the purpose of
facilitating communication and interaction among insurance regulators to enhance
insurance regulation and establish national standards, where appropriate.
The objective of the NAIC is to serve the public interest by assisting state insurance
supervisory officials, individually and collectively, in achieving the following
fundamental insurance regulatory objectives: 1) protect the public interest, promote
competitive markets and facilitate the fair and equitable treatment of insurance
consumers; 2) promote the reliability, solvency and financial solidity of insurance
institutions; and 3) support and improve state regulation of insurance. The primary
means for NAIC members to be actively involved in the association is through the NAIC
committee system. Each commissioner serves, or delegates to state insurance department
staff, the responsibility to serve on various NAIC committees, task forces and working
groups. The NAIC is committed to conducting its business openly, subject to the
discretion of the chairpersons of committees, subcommittees, tasks forces, working
groups and subgroups, who may determine those situations in which public discussions
would not be appropriate.
The NAIC coordinates and assists state solvency efforts in a number of ways, including:
1) maintaining extensive insurance databases and a computer network that are assessable
5
The fifty states, the District of Columbia, and the U.S. territories are collectively referred to as “states” in
this document.
5
BOG-- FOIA 10-251 --000212
to all state insurance departments; 2) analyzing and informing regulators as to the
financial condition of insurance companies; 3) coordinating examinations and regulatory
actions with respect to financially weakened companies; 4) establishing and certifying
states’ compliance with minimum financial regulation standards through the NAIC’s
Financial Regulations Standards and Accreditation Program (Accreditation Program); 5)
providing financial, reinsurance, actuarial, legal, computer and economic expertise to
state insurance departments; 6) valuing securities held by insurers; 7) analyzing and
listing nonadmitted alien insurers;6 8) developing uniform statutory financial statements
and accounting rules for insurers; 9) conducting education and training programs for
insurance department staff; 10) developing model laws and coordinating regulatory
policy on significant insurance issues; and 11) conducting research and providing
information on insurance and its regulation to regulators, state legislators, Congress, U.S.
government agencies, insurance regulators in other countries, and the general public.
In June 1989, the NAIC adopted the Financial Regulation Standards (the Standards), that
established baseline sound practices for an effective regulatory system in each insurance
department. The Standards are applied through a formal, voluntary certification program
administrated by the NAIC. The objective of the Accreditation Program is to provide a
process whereby solvency regulation of multi-state insurance companies can be enhanced
and adequately monitored by the states. The Standards are grouped into three areas: 1)
laws and regulations; 2) regulatory practices and procedures; and 3) organizational and
personnel practices. Under this Accreditation Program, an independent team of
experienced consultants reviews each insurance department’s compliance with the
Standards at least every five years. All states have enacted legislation designed to
achieve compliance with the Standards, and as a result, insurance department budgets and
staffing have increased significantly. As of March 1, 2005, 49 states and the District of
Columbia were accredited under the Accreditation Program.
Insurance companies are chartered by individual jurisdictions and receive a certificate of

authority (that is, a license) to conduct business from each jurisdiction in which the
company desires to underwrite insurance. This has been the case since 1792, when
chartered insurance companies were first required by the states to limit company
activities and investments, and to file financial statements. The power of a state to
regulate insurance was established in 1869 in Paul v. Virginia, where insurance was
6
A nonadmitted insurer is a company not licensed by a state to sell insurance policies within the state.
Alien insurers are those formed according to the legal requirements of a foreign country. In order for an
alien insurer to conduct operations and sell its products in a particular state, the insurer must conform to the
state’s rules and regulations governing insurance companies. A nonadmitted alien insurer may be allowed
to write on a surplus lines basis if it complies with the state’s eligibility requirements. To assist states in
their review of nonadmitted alien insurers, the NAIC produces a Quarterly Listing of Nonadmitted Alien
Insurers (the Listing). If an insurer appears in the Listing, it has filed specified documents with the NAIC
International Insurers Department (IID) and, based upon these documents and other information, appears to
fulfill the criteria for eligibility set forth by the NAIC. Several states utilize the Listing to some capacity
within their respective state statutes or regulations in relation to their eligibility requirements.
6
BOG-- FOIA 10-251 --000213
declared a local matter rather than commerce between the states. By 1870, many of the
states had appointed a state official to oversee insurance.
In 1944, the U.S. Supreme Court in United States v. South-Eastern Underwriters

Association ruled that insurance was “commerce” and subject in its interstate activity to
regulation by the Congress and the statutory restriction of the Sherman Act prohibition
against restraint of trade. In 1945, however, Congress enacted the McCarran-Ferguson
Act, which included a limited exception from certain antitrust laws for certain insurance-
related activities. The McCarran-Ferguson Act generally made insurance subject to state
control and withheld the application of federal statutes to the extent that state law
regulated such business, except in instances where the federal law specifically relates to
insurance.
The states issue a number of different insurance company license types, including life and
health, and property and casualty licenses. The states also issue insurance producer
license types, including broker, independent agents, managing general agents, and
general agent licenses.7 Reinsurers may either be authorized or licensed to write
reinsurance business depending on the states laws and regulations. Under state insurance
law, provided the owner meets certain criteria through the regulatory approval process,
there are very few outright restrictions on a licensed insurer’s ownership by, or affiliation
with, other financial or non-financial companies. An exception is the general prohibition
on foreign government ownership of an insurer.
State insurance law does not provide for consolidated supervision of the insurance
holding company or the parent holding company. However, an insurance company is
subject to state restrictions and disclosures regarding inter-affiliate relationships, and
change in ownership is subject to state insurance department approval. Under state law, a
licensed insurance company is generally authorized to own subsidiaries that conduct
insurance or insurance-related business activities, including real estate management and
real estate development. Investments in higher risk activities are limited by state statutes
and indirectly through statutory RBC minimum standards.
State insurance regulators have recognized a growing need to more fully coordinate their
regulatory efforts with other state insurance regulators, including efforts for sharing
confidential supervisory information. Historically, there has been significant
coordination with respect to supervising financially weakened companies; similar efforts
are also underway to focus on holding company systems or insurance groups that are
financially strong. In 2000, the NAIC formed the Insurance Holding Company (E)
Working Group (IHCWG) in an effort to document a framework for information sharing
and coordination of regulatory processes for analyzing insurance holding companies and
their insurance subsidiaries. The NAIC Framework for Insurance Holding Company
7
An independent agent is a contractor who represents more than one insurance company when placing a
client’s business. A general agent is a person appointed by one insurer who is responsible for insurance
agency operations in a particular geographical area, including the sale of life and health insurance,
recruiting and training agents, and providing administrative support.
7
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Regulation (Framework) is the result of the IHCWG’s work. The Framework provides
guidance for state insurance regulators to understand the holding company structure of
insurers operating in their state, as well as to coordinate their supervisory approaches for
reviewing holding company transactions that may impact insurance subsidiaries
domiciled in multiple jurisdictions. Currently, this Framework is in the implementation
stage.
Banking
The FRS is the primary federal banking regulator for state member banks. It also has
supervisory authority for all U.S. bank holding companies. In the U.S., commercial
banks are either federally chartered by the Comptroller of the Currency (OCC) as
national banks, or are chartered by a state. National banks are supervised by the OCC
and are members of the FRS. State-chartered banks that are members of the FRS are
referred to as state member banks, and are supervised by both the applicable state
banking department(s) and the FRS. A state bank that does not choose to become a
member of the FRS is referred to as a state nonmember bank and is supervised by both
the applicable state banking department(s) and the FDIC. The OCC, FRS and FDIC are
the primary federal bank supervisors for national banks, state member banks and state
nonmember banks, respectively. A “dual banking system” exists in the U.S. whereby
state-chartered banks have both a federal bank and a state bank regulator(s).8 Therefore,
the FRS actively coordinates its supervision of state member banks with the applicable
state banking department(s).
Prior Federal Reserve Board approval is required for a company to initially become a
BHC or for an existing BHC to acquire control of, or more than five percent of a class of
voting securities of, additional BHCs or banks. Relevant federal statutes state that
control of a BHC or bank exists when a company has (i) ownership, control, or power to
vote 25 percent or more of the outstanding shares of any class of voting securities of the
BHC or bank, directly or indirectly or acting through one or more other persons; (ii)
control in any manner over the election of a majority of the directors, trustees, or general
partners (or individuals exercising similar functions) of the BHC or bank; or (iii) the
power to exercise, directly or indirectly, a controlling influence over the management or
policies of the BHC or bank. A company includes corporations, partnerships,
associations, certain trusts, and similar organizations. Also, non-financial firms generally
are prohibited from controlling banks and thus are prohibited from owning 25 percent or
more of the voting stock of a bank.
The FRS has supervisory authority over BHCs, including those that are FHCs, and
supervises these entities on a consolidated basis. The FRS supervisory approach reflects
the “source of strength” doctrine, which asserts that a BHC should serve as a source of
financial and managerial strength to its subsidiary banks, within certain constraints. This
doctrine was reconfirmed in the GLB Act, except that the Act indicates that the FRS
cannot require a BHC that is an insurance company, or an insurance company that is an
8
A state-chartered bank may be subject to supervision in all states in which it operates.
8
BOG-- FOIA 10-251 --000215
affiliate of a depository institution, to provide funds or other assets to the affiliated
depository institution if the state insurance authority makes a determination, in writing,
that such action would have a material adverse effect on the financial condition of the
insurance company.
The FRS is comprised of 12 regional Federal Reserve Banks under the general oversight
of the Federal Reserve Board, which is located in Washington, D.C. The Federal Reserve
Board and its staff develop FRS regulations and policies. The Federal Reserve Board is
an independent government agency overseen by 7 board members, including the Federal
Reserve Board Chairman and Vice Chairman, all of whom are appointed by the president
and confirmed by the Senate. Each Federal Reserve Board member is appointed to serve
a 14-year term, or if replacing a board member whose term has not yet expired, to serve
the remainder of the previous board member’s 14-year term. The Federal Reserve Board
Chairman has a 4-year term, and may be reappointed.
In carrying out responsibilities for the comprehensive supervision of BHCs, including

FHCs, the FRS coordinates and cooperates, as appropriate, with the other bank and thrift
regulators, including the OCC, the FDIC, the Office of Thrift Supervision (OTS), and
state banking departments. The Federal Financial Institutions Examination Council
(FFIEC), whose members consist of the FRS, OCC, OTS, FDIC and National Credit
Union Administration (NCUA), is an organization that fosters uniform depository
institution regulatory reporting and consistent supervisory policy among those federal
agencies. Moreover, federal and state bank and thrift supervisors share certain databases
and other supervision tools and resources in order to develop coordinated and consistent
regulation of supervised entities.
Additionally, in carrying out its role as the consolidated supervisor for BHCs, including
FHCs, the FRS also relies on and coordinates its supervisory activities with, as
appropriate, the Securities and Exchange Commission (SEC) and the Commodity Futures
Trading Commission, and state insurance and securities regulators.
9
BOG-- FOIA 10-251 --000216
TOOLS FOR IDENTIFYING FINANCIALLY WEAKENED INSTITUTIONS
Insurance
Financial Reporting
The NAIC reporting requirements have evolved considerably since its annual statement
introduction in 1879. All states require an insurer to use the NAIC annual and quarterly
statement reporting forms to satisfy their statutory financial statement filing
requirements, except that states may exempt an insurer from this requirement, as
appropriate. The complete annual statement filing currently includes a balance sheet,
income statement, statement of cash flow, notes to financial statements, general
interrogatories,9 and a significant number of supporting details in various exhibits,
schedules and supplemental filings. Some of the more important exhibits and schedules
provide information about: investment income and realized gains and losses; nonadmitted
assets; Asset Valuation Reserve and Interest Maintenance Reserve; premiums and losses;
expenses; long-term investments in bonds, preferred stock, common stock, real estate,
mortgage loans, and other investments; derivatives; short-term investments; cash and
cash equivalents; reinsurance; and transactions with affiliates. Supplemental filings are
also required of most insurers, such as the actuarial opinion, the management’s discussion
and analysis, the annual audited financial report, and the RBC report. Other
supplemental filings include specialty information such as the Medicare supplement
report, the credit insurance report, and the long-term care report. Since December 31,
2003, insurers are also required to report affiliations with a BHC, bank, thrift or securities
firm; to provide the names of each such affiliate; and to identify the relevant federal
regulators of each insurer’s financial institution affiliate. In addition to the annual
statements, most insurers also are required to file the NAIC quarterly statement reporting
form that contains key information on assets and liabilities; income and surplus; changes
in investments; reinsurance; premiums written; losses and reserves.
Insurance company statutory financial reports are based on statutory accounting

principles (SAP), which are designed to address the concerns of regulators. SAP stresses
measurement of the ability to pay claims of insurers in the future, while generally
accepted accounting principles (GAAP) stresses measurement of earnings of a business
from period to period, and the matching of revenues and expenses for the measurement
period.10 Conservatism serves as a major principle in SAP. For example, some assets are
not allowed to be included in an insurer’s surplus; these are referred to as nonadmitted
assets. Another example of conservatism is the prohibition against discounting reserves,
and the fact that specific tables approved by regulators are required to establish reserves
for various life insurance products. Under GAAP, the experience expected by each
insurance company, with provision for the risk of adverse deviation, is used to determine
the reserves it will establish for its policies.
9
General interrogatories are limited-scope questions regarding an insurer and its financial position and
operations.
10
Source: Preamble of the NAIC Accounting Practices and Procedures Manual.
10
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Solvency Screening and Financial Analysis Systems
The fundamental objective of insurance company solvency monitoring is to ensure that

companies meet regulatory standards and to alert regulators if actions need to be taken to
protect policyholders. To accomplish this task, the state insurance regulators conduct
financial analysis using regulatory financial reports, financial tools and other sources of
information to detect problems that may jeopardize a company’s long-term viability.
These sources include SEC filings, corporate reports, external, independent certified
public accountant (CPA) attestation reports, financial examination and market conduct
reports, rate and policy form filings, consumer complaints, independent rating agency
reports, correspondence from agents and insurers, and business media.
State insurance departments generally prioritize the review of their domiciliary

companies based on a system of financial ratios and other screening tools, including those
maintained by the NAIC. The NAIC has created a network of financial information
systems and tools, such as the Financial Analysis Solvency Tools (FAST) System that
includes the Insurance Regulatory Information System (IRIS), the Scoring System, and
the Insurer Profiles System that are discussed below. The NAIC makes the information
systems and tools available to state insurance regulators over the NAIC’s Internet-State
Interface Technology Enhancement (I-SITE). I-SITE provides a common user interface
for more than 50 applications that are used to produce a wide variety of standard and
custom reports.
To be accredited, a state is required to conduct quarterly financial analysis on their

domiciliary multi-state insurers. Most states conduct quarterly financial analysis on their
single-state insurers as well. Typically, insurers with anomalous results, or those that
have been previously identified for attention are subject to additional analysis.
The domiciliary state is relied upon as the primary solvency regulator. When there are
concerns about the financial condition of an insurer, communications between the
domiciliary state and the other states in which the company is licensed are increased.
However, any state in which a company is licensed to conduct insurance business may
perform its own monitoring, financial examinations, and may take regulatory action, as
appropriate.
FAST System
The FAST System is a collection of analytical tools designed to provide state insurance
regulators with an integrated approach to screening and analyzing the financial condition
of insurance companies. The following are three key tools within the FAST System:
1) Insurance Regulatory Information System (IRIS)
IRIS has served as a baseline solvency screening system for the NAIC and state
regulators since the mid-1970s. IRIS is designed to help regulators prioritize
insurers for detailed financial analysis. The “statistical phase” of IRIS involves
11
BOG-- FOIA 10-251 --000218
calculating a series of financial ratios for each insurer based on its annual
statement data. The IRIS ratio results are available to the public. Because the
ratios by themselves are not indicative of adverse financial condition, an
experienced team of state insurance examiners and analysts (Analyst Team)
reviews the IRIS ratio results and various other financial information in the
“analytical phase” of IRIS, called the Analyst Team System (ATS).
For the ATS, the Analyst Team meets annually at the NAIC Executive
Headquarters to identify insurers that appear to require immediate regulatory
attention in order to assist state insurance regulators in prioritizing their annual
financial analysis reviews of insurers. The Analyst Team reviews a computer-
selected priority listing of insurers that may be experiencing weak or declining
financial results. It then validates the listing based on further analysis of those
companies, and provides a brief synopsis of its findings in a document that can be
accessed only by state insurance regulators and authorized NAIC staff.
2) Scoring System
The Scoring System is based on several financial ratios and is similar in concept
to IRIS ratios. The Scoring System, however, includes a broader range of
financial ratios and assigns a score to each ratio based on the level of solvency
concern each result generates. The ratio results and scores are available only to
state insurance regulators and authorized NAIC staff. The Scoring System is
evaluated and updated, as appropriate, by the Financial Analysis Research and
Development Working Group on an annual basis.
3) Insurer Profiles System
The Insurer Profiles System produces quarterly and annual profiles reports on
property and casualty, life and health insurers. These profiles provide either a
quarterly or annual five-year summary of a company’s financial position. The
Insurer Profile reports provide not only a snapshot of the company's financial
statement, but also include analytical tools such as financial ratios and industry
aggregate information that can be used in an analyst's review of the company.
Insurer Profile reports can assist state insurance department analysts in identifying
unusual fluctuations, trends or changes in the mix of an insurer's assets, liabilities,
capital and surplus and operations.
Peer Review Process
As a check and balance on the solvency screening efforts conducted by the states, a peer
review process was created. The objective of the NAIC’s peer review process conducted
by the FAWG is to monitor whether domiciliary regulators are taking appropriate and
effective supervisory action with respect to nationally significant insurers that are in
financial difficulty. The FAWG is made up of commissioner appointed members from
sixteen states.
12
BOG-- FOIA 10-251 --000219
On a quarterly basis, the NAIC’s Financial Regulatory Services Division staff identifies
nationally significant insurers for review using analytical criteria. Division financial
analysts perform preliminary reviews of identified insurers and then select insurers that
warrant more in-depth reviews. For those insurers, the FAWG will review the analysts’
reports and then query the domiciliary state on various aspects of each insurer’s financial
condition and any regulatory actions being taken. If the FAWG determines that the
domiciliary regulator is taking appropriate actions, then the FAWG may close the file or
continue to monitor the company. If the FAWG determines that further measures are
desirable, it will recommend the appropriate corrective action to the domiciliary state. If
the domiciliary regulators fail to follow the FAWG’s recommendation, the FAWG will
alert other affected states accordingly and coordinate their supervisory response.
State Insurance Department Financial Examination Process
The purpose of a financial condition examination is to: 1) detect insurers with potential
weaknesses; 2) determine compliance with state statutes and regulations; and 3) compile
information needed for timely, appropriate regulatory action. On-site financial condition
examinations of insurers are either full-scope or limited-scope examinations. The full-
scope examination is considered a comprehensive examination with an overall objective
to report on the company’s financial position and affairs. A limited-scope examination,
often referred to as a target examination, is conducted to review specific financial
accounts and or specific areas of the company’s operations.
State laws and regulations, as guided by the Accreditation Program, require the states to
conduct a full-scope examination for each multi-state domestic company at least once
every five years. Individual state statutes may require financial condition examinations
more often, and several states impose a three-year requirement. Limited-scope
examinations do not satisfy the NAIC Accreditation Standards to conduct financial
condition examinations at least once every five years. However, failing to conduct
limited-scope examinations for financial weakened companies may impact the results of
the accreditation review.
Frequently, full-scope examinations will be conducted as so called “zone examinations.”

A zone examination is a process to reduce the number of financial condition
examinations of multi-state licensed insurers. The concept of zone examinations
developed in response to the fact that states are entitled to conduct financial condition
examinations on insurers that are licensed in their state regardless if they are domiciled
elsewhere. As this ability could result in multiple examinations of the same company, the
process of inviting representatives from other zones to participate evolved in order to
reduce regulatory burden and increase efficiency.
On-site financial condition examinations investigate a company’s accounting methods

and procedures, financial statement presentation, and validate what is presented in the
annual financial statement assets, liabilities, capital and surplus line items, to ascertain
whether the company is in good financial standing. The main thrust of the examination is
13
BOG-- FOIA 10-251 --000220
to verify the company’s solvency and determine whether the company has complied with
state laws and regulations. In general, financial condition examinations shall at least
encompass a review of all of the following matters: 1) company history; 2) management
and control; 3) corporate records; 4) fidelity bonds and other insurance; 5) officers’,
employees’, and agents’ welfare and pension plans; 6) territory and plan of operation; 7)
growth of company; 8) business in force by states; 9) mortality and loss experience; 10)
reinsurance; 11) accounts and records; and 12) financial statements. Examinations are
conducted using a risk-based approach, whereby those areas identified as more likely to
be prone to material financial reporting error are accorded greater attention during both
the examination planning phase and the on-site examination.
The state financial condition examination process also places emphasis on the quality of
the company’s internal control structure. This requires the state examiners to assess the
internal control environment based on interviews with company management and
personnel and other control testing procedures. On occasion, state insurance departments
will engage outside experts to evaluate and test the effectiveness of internal controls (e.g.,
information system controls). The financial condition examination process also considers
the work performed by external, independent CPAs as well as the work of internal
auditors.
Regulatory Capital Framework for Insurance Companies
An insurer’s capital and surplus provides a cushion against unexpected increases in

liabilities and decreases in the value of assets, and are intended to absorb the costs of a
rehabilitation or liquidation with minimal losses to policyholders and claimants. States
require insurers to have a certain amount of capital and surplus to establish and continue
operations. A state insurance department is authorized to take over, or “seize” an
insurance company if the state can show to the applicable state court that the insurer will
be unable to meet its obligations to policyholders.
Fixed minimum capital and surplus standards for licensing and operating an insurance
company typically range in the area of $2 million to $5 million for a multi-line life and
health or property and casualty insurer. Because of the limitations of fixed minimum
capital standards, the NAIC adopted the Risk-based Capital (RBC) for Insurers Model
Act. To be accredited, a state is required to adopt a substantially similar version of the
Model Act, which contains separate formulas for life and health insurers and property and
casualty insurers, and prescribes regulatory action to be taken if an insurer’s Total
Adjusted Capital declines below certain thresholds. The stated objectives of the NAIC
RBC requirements are to provide a standard of capital adequacy that: 1) is related to risk;
2) raises the safety net for insurers; 3) is uniform among states; and 4) provides authority
for regulatory action when actual capital falls below the standard. The model act
specifies four levels of company and regulatory action, with more severe action required
at lower levels.
The NAIC’s life and health RBC formula encompasses six major categories of risk: 1)
asset risk — affiliates; 2) asset risk – common stock; 3) asset risk — other; 4) insurance
14
BOG-- FOIA 10-251 --000221
or pricing risk; 5) interest-rate risk and health credit risk and 6) business risk. The risks
addressed by the NAIC’s property and casualty formula include: 1) asset risk —
subsidiary insurance companies; 2) asset risk — fixed income; 3) asset risk — equity; 4)
asset risk — credit; 5) underwriting risk — reserves; and 6) underwriting risk — net
written premium.
Databases and Information Systems

The NAIC maintains a number of databases that state insurance regulators and NAIC
staff use for financial analysis and other regulatory functions, including: 1) the Financial
Data Repository (FDR); 2) the State Producer Licensing Database (SPLD); 3) Valuation
of Securities (VOS); 4) Regulatory Information Retrieval System (RIRS); and 5) Special
Activities Database (SAD). The NAIC financial databases serve as the core resource of
the solvency surveillance and other analysis activities of state insurance regulators and
the NAIC.
The FDR database contains the most recent 10 years of annual and quarterly financial
statement information for the approximately 5,200 U.S. insurance companies. This
database provides source data for reports on individual companies and for analytical
tools, such as the FAST System.
The VOS database contains credit quality designations and fair values for insurers'
securities that are not rated and monitored by a Nationally Recognized Statistical Rating
Organization (NRSRO). This database, combined with NRSRO ratings data, allows
regulators to assess the relative credit risk of the securities owned and reported by
insurers.
The SPLD database contains information on insurance companies, such as consumer

complaints, and on nearly 3.5 million individual producers, including producer licensing
and appointment information.
RIRS database contains formally adjudicated regulatory actions taken by participating

state insurance departments against insurance producers, companies and other entities
engaged in the business of insurance. The SAD is a confidential database that contains
information related to suspicious market activities and legal actions involving entities
engaged in the business of insurance. The RIRS and SAD databases enhance state
insurance regulators’ ability to share information among state insurance departments on
individuals or companies suspected of illegal or questionable activities and are tools to
assist in the prevention of movement of these activities into new areas.
State insurance regulators and NAIC staff also use an electronic mail system on the
NAIC’s computer network to communicate and coordinate supervisory developments
with respect to examinations, regulatory actions, financially weakened companies, and a
variety of other matters.
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Banking (State Member Banks and BHCs)
Financial Reporting
All banks, including state member banks, are required to file quarterly regulatory reports
known as FFIEC Call Reports consisting of consolidated balance sheets, income
statements, RBC data and selected supplementary financial information. All BHCs are
also required to file periodic regulatory reports. Those BHCs with consolidated assets
over $150 million, and BHCs below that threshold that are categorized by the FRS as
“complex,” are required to file consolidated balance sheets, income statements and RBC
data, as well as parent company financial statements, on a quarterly basis. BHCs under
$150 million that are non-complex BHCs are required to file parent company only
financial statements semi-annually, but are not required to file fully consolidated
financial reports. Additionally, all BHC are required to file periodic regulatory reports
detailing certain intercompany transactions and balances between a bank and its nonbank
affiliates; balance sheet and income statement data for certain of its domestic, non-
functionally regulated nonbank subsidiaries and certain foreign domiciled bank and non-
bank subsidiaries; and reports of new activities commenced. There are a number of other
regulatory reports that must be filed by state member banks and BHCS.11
Surveillance and Monitoring
The FRS off-site surveillance program is designed to monitor the financial condition and
performance of individual state member banks and BHCs on a quarterly basis to facilitate
identifying deterioration in the condition of companies between on-site examinations and
inspections. Monitoring is accomplished, in part, through the use of automated screening
systems and econometric models. These tools rely significantly on data reported on
standardized regulatory reports and from the findings of on-site examinations. The
surveillance program takes into consideration a number of aspects of banking
performance, including capital adequacy, asset growth, loan quality and loan
concentrations, liquidity, and capital markets activities. These surveillance results,
produced by Federal Reserve Board staff, are distributed to the Federal Reserve Banks
for further review, analysis, and follow-up.
FRS Surveillance screens incorporate the results of two econometric models, together
known as the System for Estimating Examination Ratings (SEER).12 The SEER risk rank
model estimates the probability that a bank will become critically undercapitalized within
the next two years. The SEER rating model estimates a bank’s composite CAMELS
11
A complete listing of bank and BHC report forms and instructions may be found on the Federal Reserve
Board and the FFIEC websites (http://www.federalreserve.gov/ and http://www ffiec.gov/, respectively).
12
The SEER system developed by a FRS Surveillance Task Force was formerly known as the Financial
Institutions Monitoring System (FIMS). The SEER models have been updated since they were first
implemented, but a detailed description of the econometric frameworks used is contained in an article by
Rebel Cole, Barbara Cornyn and Jeff Gunther in the Federal Reserve Bulletin, volume 81, number 1,
January, 1995, pps. 1-15.
16
BOG-- FOIA 10-251 --000223
rating based upon Call Report data and examination rating information. The surveillance
screening results are strictly confidential.
To support off-site monitoring of bank performance and condition and on-site

examinations, the FFIEC produces a quarterly Uniform Bank Performance Report
(UBPR) for each commercial bank and FDIC-insured savings bank. These reports
display current and historic balance sheet and income statement items, along with key
performance ratios and peer group statistics. The FRS produces a similar report, the
Bank Holding Company Performance Report (BHCPR), for BHCs over $150 million in
consolidated assets. These UBPR and BHCPR reports are publicly available.
Bank Examinations and BHC Inspections
The FRS’s safety and soundness examinations of state member banks and inspections of
BHCs are focused on determining the financial condition and performance of an
institution, and on evaluating management, internal controls and the risk management
structure. The Federal Reserve is required to conduct a full-scope, on-site examination of
every insured state member bank at least once during each 12-month period, with the
exception that certain small institutions may be examined once during each 18-month
period. The frequency of BHC inspections is determined by the size, condition, and
complexity of the BHC.
Examiners assign a composite rating to a banking institution reflecting an assessment of

the overall condition of the institution, including an assessment of relevant processes and
risk management techniques. As noted earlier, the rating system used for banks is known
as CAMELS, an acronym for the components it evaluates: capital, asset quality,
management, earnings, liquidity and sensitivity to market risk. Until January 1, 2005,
BHCs were assigned a supervisory rating using a rating system known as BOPEC, which
included evaluations of: bank subsidiaries (“B”); “other” (nonbank subsidiaries) (“O”);
the parent company (“P”); consolidated BHC earnings (“E”); and consolidated BHC
capital adequacy (“C”). A new BHC rating system has been adopted effective January 1,
2005.13 Under this system, a BHC is assigned an RFI/C(D) rating rather than a BOPEC
rating. RFI/C(D) is an acronym for the components of: risk management (“R”); financial
condition (“F”); potential adverse impact (“I”) of nonbank affiliates on the affiliated
depository institution(s); a composite BHC rating (“C”) based on an evaluation and rating
of the BHC’s managerial and financial condition and an assessment of future potential
risk to its subsidiary depository institution(s); and a rating for the depository institution(s)
(“D”) that will generally mirror the primary regulator’s assessment of the subsidiary
depository institution(s). Bank and BHC supervisory ratings and the reports of bank
examinations and BHC inspections are strictly confidential.
FHCs are generally supervised similarly to any other BHC with a focus on understanding
and assessing the quality of centralized risk management and control processes for key
13
SR letter 04-18, Bank Holding Company Rating System, may be accessed on the Federal Reserve Board’s
public website.
17
BOG-- FOIA 10-251 --000224
business lines, as well as understanding the intra-group exposures and risk concentrations
across all business lines. To supervise a diversified BHC, the FRS relies to the extent
possible on, and coordinates with, the appropriate functional regulators.
Financial safety and soundness examinations and inspections generally include a review
of compliance with a wide range of laws and regulations. In addition, the FRS also
conducts consumer compliance examinations of state member banks to determine
adherence with applicable consumer protection laws and regulations and assigns a
compliance examination rating. Depository institutions, including state member banks
supervised by the FRS, are also evaluated for their compliance with the CRA and
assigned a separate CRA rating. An institution’s CRA rating is publicly available.
Regulatory Capital Frameworks
Basel Capital Accord
The Basel Capital Accord (Basel I), the current international framework for bank capital
adequacy, was adopted in 1988 by the G-10 group of central banks and other national
supervisory authorities, working through the Basel Committee on Banking Supervision.14
The FRS and the other federal banking agencies implemented an RBC approach for U.S.
banking organizations in 1989. The fundamental objectives of Basel I are to promote the
soundness and stability of the international banking system and to provide an equitable
basis for international competition among banks. More specifically, Basel I sets forth
RBC standards intended to assist in the assessment of capital adequacy of depository
institutions. Other key objectives of the standards were to: 1) make regulatory capital
requirements more sensitive to differences in risk profiles among banks; 2) factor off-
balance sheet exposures into the assessment of capital adequacy; 3) minimize
disincentives to holding liquid, low-risk assets; and 4) achieve greater consistency in the
evaluation of the capital of the major banks throughout the world.15
Under the Basel I framework, capital adequacy is assessed primarily in relation to credit
risk with the other risks addressed implicitly. In 1996, Basel I was amended to take
explicit account of market risk in trading accounts (i.e., the risk of loss due to a change in
market prices, such as equity prices or interest or exchange rates).
Under the Basel I framework, a bank (and, in the U.S., generally a BHC with
consolidated assets greater than $150 million) is required to have regulatory capital, as
measured by combinations of equity, allowance for loan and lease losses (ALLL),
qualified subordinated debt, and certain other instruments, at least equal to 8 percent of
14
The Basel Committee on Banking Supervision was established in 1974 comprising members from the
central banks or other supervisory authorities of Belgium, Canada, France, Germany, Italy, Japan,
Luxembourg, the Netherlands, Spain, Sweden, Switzerland, the United Kingdom, and the U.S.
15
Additional detail and background on the FRS’s and the NAIC’s RBC approaches can be found in the
Report of the NAIC and the Federal Reserve System Joint Subgroup on Risk-Based Capital and Regulatory
Arbitrage, dated May 24, 2002.
18
BOG-- FOIA 10-251 --000225
the amount of its risk-weighted assets. For the calculation, assets are weighted according
to the level of perceived risk, and each off-balance sheet exposure is converted to an on-
balance sheet equivalent, and then risk-weighted. Assets and off-balance sheet
equivalents are generally risk-weighted at 100, 50, 20, or 0 percent. This measure is
referred to as the total RBC ratio.
Another measure of capital adequacy used in the banking organization RBC framework is
the Tier 1 RBC ratio. The Tier 1 RBC ratio is a more conservative measure that
generally excludes debt instruments and the ALLL from the capital numerator. To be
adequately capitalized, a U.S. banking organization must have a minimum Tier 1 RBC
ratio of 4 percent. In addition, banking organizations are subject to a leverage ratio
measure to evaluate capital adequacy. The leverage ratio, which is calculated as equity
capital as a percentage of average balance sheet assets, is also used to evaluate capital
adequacy.
Currently, a revised RBC framework referred to as the Basel II Capital Accord is in the
process of being implemented by U.S. and many foreign bank regulators. The objectives
for reform include improving risk measurement and management; linking, more
precisely, the amount of minimum regulatory capital to the amount of risk taken; further
focusing the dialogue between supervisors and a banking organization on the
measurement and management of risk and the connection between risk and capital; and
increasing market discipline through enhanced transparency.16
Prompt Corrective Action (PCA)
As a result of the bank failures in the late 1980s and the rapid depletion of the federal
deposit insurance fund, Congress mandated a PCA framework in the Federal Deposit
Insurance Corporation Improvement Act of 1991 (FDICIA). This act requires federal
bank regulators to administer timely corrective action to a bank when its capital position
is deemed to have declined below certain threshold levels. The PCA framework specifies
mandatory actions that regulators must take if capital ratios fall below certain thresholds,
as well as discretionary actions that may be taken.17
Under the PCA statute and accompanying regulations, a bank is assigned to one of five
capital categories based primarily on the capital ratios reported in the quarterly FFIEC
Call Reports. Four of the five PCA capital categories – “well capitalized,” “adequately
capitalized,” “undercapitalized,” and “significantly undercapitalized,” are based on three
capital adequacy ratios: the total RBC ratio, the Tier 1 RBC ratio, and the leverage ratio.
The most severe capital category, “critically undercapitalized,” is determined by a bank’s
16
Additional information pertaining to the Basel II Capital Accord may be found on the FRS public
website (http://www federalreserve.gov/) and the Bank for International Settlements public website
(http://www.bis.org/index htm).
17
The PCA regulations applicable to state member banks are found at the Federal Reserve Board’s
Regulation H, Subpart D (12 C.F.R. 208.40 et seq.).
19
BOG-- FOIA 10-251 --000226
tangible equity ratio, which measures the equity capital to assets ratios excluding
intangible assets from the numerator and the denominator.
If a bank is deemed to be “undercapitalized,” “significantly undercapitalized,” or

“critically undercapitalized” as defined in FDICIA based on its capital ratios, the bank
must submit a capital restoration plan that is acceptable to its primary federal regulator,
may not make any capital distribution, and may not pay a management fee to anyone that
controls the bank. In addition, the bank may not increase its asset size, except under
limited conditions, and may not make acquisitions or establish new branches or new lines
of business, unless it meets certain conditions. Significantly undercapitalized and
critically undercapitalized banks are subject to additional mandatory restrictions. The
bank’s primary federal regulator may also impose one or more of the discretionary
restrictions enumerated in the statute and regulations through the issuance of a Prompt
Corrective Action Directive to any undercapitalized, significantly undercapitalized, or
critically undercapitalized bank. A bank may contest the issuance of such a directive
through an agency appeal process. Under the PCA statute, a critically undercapitalized
bank generally must be placed in conservatorship or receivership within 90 days of
becoming critically undercapitalized.
In accordance with FDICIA, a BHC must guarantee its subsidiary bank’s capital
restoration plan and provide appropriate assurances of performance. Additionally, the
cross-guarantee provision of FDICIA requires that, generally, any insured depository
institution is liable for losses to the FDIC arising from the default of a commonly
controlled insured depository institution. This provision was implemented, in part, to
avoid the potential adverse effect of a bank shifting bad assets into a failing affiliate bank
and thereby increasing the cost to the FDIC insurance fund.
Databases and Information Systems
The Federal Reserve Board maintains the National Information Center (NIC), a
repository for both bank structure, financial, and confidential supervisory data for all
commercial banks and BHCs. Additionally, the Central Document Text Repository
(CDTR) is the repository for the electronic versions of commercial bank examination and
BHC inspection reports, as well as other confidential supervisory documents. Front-end
systems are available to authorized FRS staff for accessing these databases containing
both publicly available and confidential supervisory information.
20
BOG-- FOIA 10-251 --000227
APPROACHES FOR SUPERVISING A FINANCIALLY WEAKENED
COMPANY
The state insurance regulators and the FRS each have enforcement powers to support
their ability to carry out their supervisory responsibilities, and both are subject to laws
that require the regulator to take specified corrective action based on RBC thresholds for
supervised insurers and supervised state member banks, respectively.
State Insurance Departments
Regulatory actions of an insurance department include activities that go beyond the

monitoring and surveillance activities described above include:
Hearings/Conferences – These are sessions in which witnesses are requested to

discuss, testify, or otherwise provide information to a state’s insurance department
with respect to a specific insurance company or group of companies. Hearings or
conferences may be conducted either informally, involving only the department and
insurance company personnel, or formally, involving the presence of an appointed
hearing officer to conduct the session.
Implementation of a Corrective Plan – This involves the execution of a plan of action,

reviewed and monitored by a state insurance department, for an insurer to correct a
troubled or potentially troubled situation. This may include corrective plans required
under RBC requirements.
Restrictions on Activities – Such activities may include prohibitions, conditions, or

limitations placed by a state insurance department on certain activities or transactions
of an insurance company. Examples include requiring pre-approval by the department
of specific activities or transactions. The ability to place restrictions on an insurance
company depends, in part, on the laws or regulations of the particular jurisdiction.
Notice of Impairment – This is a formal regulatory communication from a state

insurance department to an insurance company informing the insurance company that
the company does not meet stated minimum statutory capital and/or surplus
requirements and requiring the company to correct the deficiency by a certain date.
Cease and Desist/Suspension Order – This is a formal regulatory communication from

a state insurance department ordering an insurance company to stop certain activities,
such as the issuance of new insurance policies.
Supervision – This is an action taken by a state insurance department under its

administrative or legal provisions, under which a supervisor is appointed by an
insurance department or by a court to “supervise” the operations of an insurance
company. The supervision may be “confidential” (i.e., unannounced or “drawer”),
“announced” by the insurance department, or “voluntary” (i.e., assistance was
requested or acknowledged by the insurance company).
21
BOG-- FOIA 10-251 --000228
The Federal Reserve System
The FRS employs a range of tools to identify and address a supervised bank or BHC
exhibiting emerging problems or weakened financial condition in order to maintain a
sound banking system, minimize potential losses to the FDIC insurance fund, and
facilitate the institution’s return to financial health, if possible. Routinely, a summary of
examiner findings and expected actions is conveyed to the banking organization
following each targeted review of a particular business line or business activity, as well
as in an examination report that summarizes the key findings of the reviews conducted
during the 12- to 18- month examination cycle. For those institutions whose problems
warrant additional supervisory action, a range of informal and formal supervisory actions
is available, in addition to the PCA measures for banks described above.
Informal corrective actions include resolutions adopted by an institution’s board of

directors and Memoranda of Understanding between the appropriate Federal Reserve
Bank and an institution, whereby the institution’s board agrees to implement the actions
that the institution will take to correct deficiencies. Informal actions are not made
publicly available by the FRS.18
Formal corrective actions, including Written Agreements and Cease and Desist Orders,
are authorized by the Federal Deposit Insurance Act (FDI Act) to correct violations of
law and unsafe or unsound practices. These agreements and orders may require a
depository institution, a BHC, certain other entities, and any institution-affiliated party,
including any director, officer, employee or controlling shareholder to take affirmative
action to correct deficiencies or to cease engaging in the violations or other unsafe or
unsound practices. Written Agreements and Cease and Desist Orders are made publicly
available. They may include measures designed to improve a bank’s capital and asset
quality by placing restrictions on dividends, requiring the employment of more qualified
management and improved oversight by the bank’s board of directors. Written
Agreements and Cease and Desist Orders against BHCs may also include requirements
for capital infusions to an undercapitalized FDIC-insured subsidiary bank; restrictions on
additional debt, dividends, and inter-corporate transactions; and the termination of certain
nonbank activities that constitute violations of law or unsafe or unsound banking
practices.
In cases where specific violations or practices are likely to cause insolvency, cause
dissipation of assets or earnings, weaken the condition of the institution, or prejudice the
depositors’ interests, the FRS may issue a Temporary Cease and Desist Order to address
these violations or practices. A Temporary Cease and Desist Order requires the banking
organization to take or cease specific actions and remains in effect pending the outcome
of an administrative hearing on the issues. Temporary Cease and Desist Orders are
18
The SEC requires publicly traded companies to make public disclosure of certain material information
that may affect the securities markets. A publicly traded financial institution, therefore, may be required to
disclose the existence of certain informal actions taken by the FRS if the actions are deemed to be material.
22
BOG-- FOIA 10-251 --000229
generally not made public by the FRS. In the event that an institution does not consent to
supervisory action, the FRS may issue a Notice of Charges to initiate litigation.
The FRS is authorized by the FDI Act to suspend or remove institution-affiliated parties
who have engaged in a violation of law, an unsafe or unsound practice, or a breach of
fiduciary duty, which has caused a bank to suffer a financial loss or other damages or has
resulted in a gain to the individual, and that involves personal dishonesty or demonstrates
continuing or willful disregard for the safety and soundness of the institution.
Notwithstanding these enforcement powers, the GLB Act prohibits the Federal Reserve
Board from requiring an insurance company that is a BHC or an insurance company that
is a subsidiary of a BHC to provide capital to a depository institution subsidiary of the
BHC if the state insurance authority determines, in writing, that such a funds transfer
would have a material adverse effect on the financial condition of the insurance company.
Additionally, the GLB Act generally prohibits the Federal Reserve Board from taking
enforcement action against an insurance company, unless the action is necessary to
prevent or redress a practice that poses a material risk to an affiliated depository
institution or to the domestic or international payments system, and it is not reasonably
possible to protect against the material risk through action directed at the depository
institution.19
19
These provisions are codified at 12 U.S.C. 1844(g) and 12 U.S.C. 1848a, respectively.
23
BOG-- FOIA 10-251 --000230
RECEIVERSHIP AND LIQUIDATION
Both state insurance regulators and banking regulators have statutory requirements for
receiverships and liquidations of supervised entities. State receivership and liquidation
laws vary to some degree. For a state insurance department to be accredited by the
NAIC, a state must have laws that substantially conform to the NAIC Model
Receivership Act.
State Insurance Supervisors
Delinquency proceedings are instituted against an insurance company by a state

insurance department for the purpose of conserving, rehabilitating, reorganizing, or
liquidating the insurance company. Among the various types of delinquency that may be
permissible under state law are the following:
Conservation — This term has different meanings in different jurisdictions. The scope
of conservation efforts can vary from a seizure of certain assets to rehabilitation.
Seizure of Assets — A state’s legal or administrative provisions provide for an

insurance department to take control of an insurer’s assets, books, records, and
business premises if the insurer is domiciled in the state, in order to conserve the
company’s assets for the benefit of its policyholders and creditors.
Rehabilitation — An insurance company may be placed in a rehabilitation status by

an insurance department through a jurisdiction’s legal or administrative proceeding.
The rehabilitation process generally involves, sometimes under a court order, the
transfer of operational authority from insurance company management to a
rehabilitator with the objective of returning the company to a sound financial and
operational condition. The court order could, among other matters, direct the
rehabilitator to take possession of the assets and administer the assets and the
operations of the insurance company under the supervision of the court or under a
formal plan approved by the court with notice to the company’s affected creditors.
Liquidation — In the event that rehabilitation of an insurer is unsuccessful, the

insurance department may, through legal proceedings, place the insurer in liquidation.
The liquidation process ordinarily would include the seizure and marshalling of the
company’s assets, a determination of the company’s liabilities, and the distribution of
the assets of the insurance company under the supervision of the court to address or
redeem those liabilities.
Dissolution — An insurance department may petition a court for an order to dissolve

or terminate the corporate existence of a domestic insurance company following its
complete liquidation.
The nature, timing, and extent of regulatory action in any given troubled company
situation depends, in part, on the applicable jurisdiction’s laws and regulations to which
24
BOG-- FOIA 10-251 --000231
the insurance company is subject, as well as the circumstances of the particular situation.
State insurance law may use different terms to refer to essentially similar actions, and the
actions that are available to an insurance department differ among the states.
When an insurer is found to be insolvent and is ordered liquidated, the guaranty funds are
the source of last resort to provide protection for the insurer’s policyholders and
claimants. Not all policy obligations, however, are covered. For those that are covered,
statutory limits apply. Additionally, not all policyholders and claimants are covered.
Bank Supervisors
In the event that a commercial bank is formally declared insolvent by its chartering
agency (a state banking department or the OCC), the chartering agency and the applicable
federal regulator — the FRS, OCC, or the FDIC, in its supervision capacity — generally
no longer have any responsibility for supervising the bank. Federal statutes name the
FDIC as receiver and outline the process of a bank receivership and liquidation as well as
the prioritization of claims. The amount of FDIC insurance coverage of $100,000 per
depositor is uniform nationwide in the event of a bank insolvency. Deposits of larger
amounts have priority over all other non-depositor creditors.
In the event that all of a BHC’s insured depository institutions are placed into
receivership, the company is no longer a BHC, and, therefore, is no longer supervised by
the FRS. The FRS generally has no role in the liquidation of a BHC or a company that
was formerly a BHC. Such liquidations are administered in accordance with federal
bankruptcy laws.
25
BOG-- FOIA 10-251 --000232
CONCLUSION
This joint initiative has advanced the insurance and banking regulators’ understanding of
each other’s approaches for identifying and supervising financially weakened institutions
and enhances coordination between the state insurance departments and the FRS,
consistent with the GLB Act mandates for supervision of FHCs. In addition, many other
efforts between the FRS and the state insurance supervisors, including the
implementation of Memoranda of Understanding now in place between most state
insurance departments and the Federal Reserve Board for sharing appropriate
confidential, supervisory information and consumer complaints, as envisioned in the
GLB Act,20 have fostered effective coordination of supervisory activities. These
accomplishments represent significant milestones in the achievement of effective
cooperation between banking and insurance regulators.
20
Other initiatives include the completion of a report mapping risks arising from insurance company
activities into the standard FRS bank supervisory risk categories. See the report by the NAIC and the
Federal Reserve System Joint Subgroup on Financial Issues, Identification and Mapping of Insurance Risks
into the Federal Reserve System’s Defined Banking Risks, dated June 10, 2003.
26
BOG-- FOIA 10-251 --000233
Appendix A
Summary of State Regulation for Identifying and Supervising Financially Weakened Insurers
Regulatory Response
Phase1 Trigger Points Explanation Informal2 Formal3 Comments
1 Periodic (annual Annual Statements are filed by Used in annual NA The NAIC Accreditation
and quarterly) March 1 of each year. Quarterly reviews, quarterly Program provides timelines
financial analysis Statements are filed within 45 reviews and financial by which analysis of
of statutory days following each quarter-end. condition examination domestic insurers should
financial The annual statement review planning. Analysis be completed by state
statements process tends to be the more results may lead to: 1) insurance departments.
comprehensive of the two phone or e-mail
periodic reviews, because of the inquiry; 2) letter
amount and depth of requesting additional
information provided by the information; or 3)
statement. The analytical tools face-to-face meeting
described in the cells below are with management.
utilized throughout the reviews.
In addition, the state insurance
department analyst also consider
other factors/conditions such as
a prolonged devaluation in the
stock or real estate markets;
reinsurance recoveries;
deterioration of parent
company's public debt rating;
and class action lawsuits.
1
The term, “phase” in this table is used to refer to possible levels of progression relating to supervisory action as outlined in the NAIC Troubled Company Handbook.
2
Powers confirmed by discretionary authority of a commissioner or department of insurance.
3
Powers permissible by state statute or regulation.
A-1
BOG-- FOIA 10-251 --000234
Regulatory Response
1
Phase Trigger Points Explanation Informal2 Formal3 Comments
1 Scoring System The NAIC Scoring System Used in annual Ratios and scores are
ratios and scores provide an reviews, quarterly confidential. Ratios
integrated approach to screening reviews and address critical areas of an
and analyzing the financial examination planning. insurer’s operations, such
condition of insurers. Analysis results may as leverage of capital,
lead to: 1) phone or e- growth, underwriting and
mail inquiry; 2) letter investment profitability,
requesting additional investment holdings and
information; or 3) liquidity. Companies
face-to-face meeting receiving highest scores
with management. receive immediate
attention, which often leads
to a more in-depth analysis.
1 Analyst Team The NAIC ATS is a multi-tiered Used in annual Like the Scoring System,
System (ATS) process through which insurers reviews and the review process and
Review are assigned levels of priority by examination planning. results of the ATS are
a team of state Analysis results may confidential. They are
analysts/examiners. The system lead to: 1) phone or e- used by some states to
is based on a series of tests mail inquiry; 2) letter gauge the financial
applied to an insurer's financial requesting additional soundness of non-domestic
results, which then assigns a information; or 3) (foreign) insurers operating
"level" ranking. If an insurer face-to-face meeting within the state.
receives a ranking in the top two with management.
levels, the company is reviewed
by a team member who then
validates or changes the
assigned level.
A-2
BOG-- FOIA 10-251 --000235
Regulatory Response
1
1 Financial An on-site examination may Required by state law; state Examinations are
Condition detect existing or potential insurance commissioner has conducted on either a full
Examination financial problems or may be absolute power to conduct or limited-scope basis.
used to investigate problems examinations as Full-scope examinations
arising from routine financial appropriate; insurer must are conducted every 3 - 5
analysis. respond to examination years. Limited-scope
report comments and examinations may be
recommendations. conducted more frequently,
depending on
circumstances.
1 Model This model is a Standard in the Standards considered These standards provide the All accredited states have
Regulation NAIC Accreditation Program. and measured during basis for a court petition to passed laws substantially
Regarding The purpose of this regulation is analysis process; rehabilitate or liquidate. similar to the NAIC model.
Hazardous to set forth standards, which the analysis results may A state’s rehabilitation and
Financial state insurance department may lead to: 1) phone or e- liquidation act may
Condition use for identifying insurers mail inquiry; 2) letter incorporate by reference its
found to be in an unsound requesting additional hazardous financial
financial condition and for information; or 3) condition law.
authority to initiate action. face-to-face meeting
with management.
1 Reinsurance An insurer's reinsurance Analysis results may May result in limited-scope Credit for reinsurance is
Company Failure program is closely monitored by lead to: 1) phone or e- examination. heavily regulated through
a state insurance department's mail inquiry; 2) letter statutes, regulations,
staff and measured by various requesting additional statutory accounting and
financial ratios. A significant information; or 3) reporting rules. These
rating downgrade or failure of face-to-face meeting rules are part of the NAIC
any reinsurer triggers a reaction with management. Accreditation Program.
from department staff to identify
affected insurers and to assess
potential impact on the insurer's
solvency.
A-3
BOG-- FOIA 10-251 --000236
Regulatory Response
1
1 Holding All insurers are required to Analysis results may May result in limited-scope Filings are required
Company Filing register certain information with lead to: 1) phone or e- examination. pursuant to NAIC
their domiciliary regulator, if mail inquiry; 2) letter Insurance Holding
part of a holding company requesting additional Company System Model
system. Information must be information; or 3) Act. All accredited states
disclosed regarding transactions, face-to-face meetings have passed laws
relationships and agreements with management. substantially similar to the
with parent, subsidiary and NAIC model.
affiliate (PSA) entities, among
other information.
1 Market Conduct All insurers periodically State insurance The NAIC continues to
Finding undergo some form of "market commissioner has absolute work toward developing
conduct" examination. As with power to conduct standards of practice for
financial condition examinations as conducting market conduct
examinations, these may be used appropriate; insurer must examinations.
to detect or investigate problems respond to examination
that impact existing as well as report comments and
prospective policyholders. recommendations.
These examinations may also
affect the insurer's financial
stability.
1 Actuarial All insurers are required to Opinion statements or To the extent possible and
Opinion appoint "qualified actuary," as a change in actuary appropriate, examiners
defined by the NAIC Annual may lead to: 1) phone may utilize the work of the
Statement Instructions Property or e-mail inquiry; 2) appointed actuary, to
and Casualty (P&C), to provide letter requesting validate reserve adequacy.
an opinion on the adequacy of additional
loss and loss adjustment expense information; or 3)
reserves, if a P&C insurer; or face-to-face meeting
policy reserves and other with management.
actuarially-determined reserves,
if a life or health insurer.
A-4
BOG-- FOIA 10-251 --000237
Regulatory Response
1
1 Independent All insurers are required to Report findings or a Associated with this filing To the extent possible and
Audit Report obtain an opinion from an change in auditor may are reporting requirements appropriate, examiners
(Report on independent auditor on their lead to: 1) phone or e- the independent, external may utilize the work of the
Significant annual financial statements. In mail inquiry; 2) letter auditor must fulfill if the independent auditor,
Deficiencies in addition, each insurer must requesting additional insurer has materially following some re-testing.
Internal Controls) submit a report prepared by the information; or 3) misstated its financial
auditor describing significant face-to-face meeting condition. If internal
deficiencies in the insurer's with management. control deficiencies are
internal control structure reported, the insurer must
identify during the annual audit. submit a remediation plan.
An insurer is also required to
report a change in auditor to the
insurance department of the
state of domicile within five
business days of the event.
2 Business or Closer monitoring requires A business plan or In some instances, state law Some state insurance
Corrective Plan obtaining the insurer's business corrective action plan explicitly requires the departments are moving to
plan or corrective plan may be required under insurer to file a business or routinely request business
(including financial projections), general supervisory corrective action plan. For plans and financial
depending on the severity of the authority. example, if an insurer projections from domestic
situation. Two to three year triggers a certain RBC insurers, particularly life
plans are often requested. action level, a Corrective insurers.
Financial analyst/examiners Action Plan is required.
utilize these plans to monitor
management's execution of the
plan and to stimulate dialogue.
A-5
BOG-- FOIA 10-251 --000238
Regulatory Response
1
Risk-Based There are five action levels, RBC standards and actions The NAIC Risk-Based
Capital (RBC) which are determined by are statutory requirements. Capital for Insurers Model
comparing a company’s Total Act, or an act substantially
Adjusted Capital (TAC) to its similar, is required to attain
Authorized Control Level state insurance department
(ACL) RBC as computed by the accreditation under the
RBC formula. TAC is NAIC’s Accreditation
compared to ACL RBC because Program.
the ACL RBC is the level at
which a state insurance
commissioner may first take
control of an insurer – that is,
control of the insurer may be
seized.
2 RBC Company TAC of 150% to 200% of RBC standards and actions
Action Level minimum RBC constitutes a are statutory requirements.
company action level under
which an insurer must prepare a
report to the state regulator
outlining the corrective actions
the company intends to take. At
this level, an insurer must
submit a comprehensive
financial plan to the regulator
that identifies the conditions
contributing to the company’s
financial condition. This plan
must contain proposals to
correct the company’s financial
problems and provide
projections of the company’s
financial condition, both with
and without the proposed
A-6
BOG-- FOIA 10-251 --000239
Regulatory Response
1
corrections. The plan also must

list the key assumptions
underlying the projections and
identify the quality of, and the
problems associated with, the
insurer’s business. If a company
fails to file this comprehensive
financial plan, this failure to
respond triggers the next action
level.
2 RBC Regulatory TAC of 100% to 150% of RBC standards and actions
Action Level minimum RBC triggers a are statutory requirements.
Regulatory Action Level
initiative. At this level, an
insurer is also required to file an
action plan, and the state
insurance commissioner is
required to perform any
examinations or analyses of the
insurer’s business and
operations deemed necessary.
The state insurance
commissioner also issues
appropriate corrective orders to
address the company’s financial
problems.
A-7
BOG-- FOIA 10-251 --000240
Regulatory Response
1
3 RBC Authorized TAC of 70 to 100% of the RBC standards and actions

Control Level minimum RBC triggers an are statutory requirements.
Authorized Control Level. This
is the first point that the law
authorizes the regulator to take
control of an insurer. This
authorization is in addition to
the remedies available at the
company and regulatory action
levels. It is important to note
that the law grants the state
insurance commissioner this
power. This action level occurs
at a point where the insurer may
still be technically solvent
according to traditional
standards – that is, the
company’s assets may still be
greater than its liabilities.
3 RBC Mandatory TAC of less than 70% triggers a RBC standards and actions
Control Level Mandatory Control Level that are statutory requirements.
requires the regulator to take
steps to place an insurer under
control. This situation can occur
while the insurer still has a
positive level of capital and
surplus, although a number of
the companies that trigger this
action level are technically
insolvent (liabilities exceed
assets).
A-8
BOG-- FOIA 10-251 --000241
Regulatory Response
1
3 Administrative State insurance commissioner Statutory requirements

Supervision exercises varying levels of relating to administrative
control over operations of an supervision vary by state.
insurer, dependent upon the
circumstances of the specific
case. Ownership of company is
not disturbed and directors
remain in place. This phase
usually involves submission of a
corrective plan by the insurer.
The state insurance
commissioner may appoint an
on-site supervisor to monitor
performance.
4 Receivership State insurance commissioner Statutory requirements Initial seizure order may be
obtains a court order authorizing relating to receivership vary obtained ex parte in some
1) seizure of a company; 2) by state. situations. State insurance
appointment of the state commissioner has broad
insurance commissioner as discretion in administering
receiver; and 3) vesting legal the receivership.
title to all assets of the company
in the state insurance
commissioner’s name.
Management and directors are
removed. As receiver, the state
insurance commissioner's
actions are subject to
supervision by the state court
that issued the receivership
order. State insurance
commissioner typically appoints
a special deputy receiver to
manage the receivership.
A-9
BOG-- FOIA 10-251 --000242
Regulatory Response
1
Receiver may attempt to

rehabilitate the insurer or, if
rehabilitation is not practical, the
receiver will liquidate the
company.
A-10
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A-11
BOG-- FOIA 10-251 --000244
Appendix B
Summary of Federal Reserve System Framework for Identifying and Supervising Financially Weakened
State Member Banks and Bank Holding Companies
This table highlights key elements of the FRS’s supervisory framework pertaining to bank holding companies (BHCs)
and state member banks. It does not purport to include all events that may trigger a supervisory response or the full
range of applicable supervisory actions.
Event That May Trigger Applicable Regulation/ Supervisory Action and

Supervisory Response Policy or Guidance1 Time Frames for Action if
Applicable
1) Quarterly surveillance SR letter 00-7: System Bank Reserve Bank staff investigates
results for state member banks Watch List Program potential financial weaknesses
and prepares or updates
analyses for watch list banks
identified through the FRS’s
quarterly surveillance process.
The analyses address the
sources of potential weakness
and their potential effect on
safety and soundness; assess the
appropriateness of current
supervisory ratings and on-site
examination schedules; and
detail future supervisory plans.
2) Quarterly surveillance SR letter 95-43: Revised Bank Reserve Bank staff prepares or
results for BHCs Holding Company updates analyses for BHCs with
Surveillance Procedures assets of $1 billion or more
identified by quarterly exception
SR letter 02-01: Revisions to screens. The Reserve Bank
BHC Supervision Procedures analyses detail the sources of
for Organizations with Total potential weakness, their effect
Consolidated Assets of $5 on safety and soundness, and
Billion or Less (Contains supervisory actions in response
separate guidance for both to surveillance screen results.
BHCs $1 - $5 billion, and For BHCs under $1 billion,
BHCs less than $1 billion in (except small, non-complex
assets.) BHCs), quarterly surveillance
screens are also used to identify
potentially significant changes in
the conditions of these
companies between on-site
supervisory reviews.
1
SR letters, the Commercial Bank Examination Manual, and the Bank Holding Company Inspection Manual provide guidance to Federal
Reserve Banks for implementing their Federal Reserve Board-delegated responsibility for the supervision of banking organizations. SR letters
are issued by Federal Reserve Board staff to the officers in charge of supervision at each Reserve Bank. These documents are accessible on
the Federal Reserve Board’s website at www federalreserve.gov.
B-1
BOG-- FOIA 10-251 --000245
Applicable
3) Risk assessments of BHCs, SR letter 97-24: Risk-Focused Based on the risk assessment,
including FHCs, and banks Framework for the supervisory staff determines the
are prepared by Federal Supervision of Large Complex scope, objectives and dates for
Reserve Bank staff. Risk Institutions targeted on-site reviews of
assessments include an selected risk areas.
analysis of the level of risk, SR letter 97-25: Risk-Focused
the direction of risk, and Framework for the Supervisory staff coordinates
management controls. The Supervision of Community with functional and primary
following risks are assessed Banks regulators when appropriate.
for the consolidated
organization, as well as for SR letter 99-15: Risk-Focused
the major business lines: Supervision of Large Complex
operational risk, credit risk, Banking Organizations
market risk, liquidity risk,
legal risk, reputational risk, SR letter 02-01: Revisions to
and overall risk. For FHCs, BHC Supervision Procedures
particular focus is on for Organizations with Total
understanding intra-group Consolidated Assets of $5
exposures and risk Billion or Less
concentrations across all
business lines. SR letter 00-15: Risk-Focused
Supervision Policy for Small
Shell BHCs
SR letter 00-13: Framework

for Financial Holding
Company Supervision
4) Significant market, FRS’s role to maintain Conduct monitoring and targeted
economic or other external stability of the banking reviews of banking
event affecting banking system as well as role of organizations, as appropriate,
industry condition prudential regulator for and develop action plans.
banking institutions.
5) Bank examinations and Federal Deposit Insurance Institutions are required to
BHC inspections Corporation Improvement Act respond to issues identified. A
of 1991 (FDICIA) requires range of informal and formal
full-scope on-site supervisory actions that may be
examinations of state member appropriate to address
banks are required at least weaknesses identified include
once during each 12-month but are not limited to:
period with the exception that • Written Agreement,
certain small institutions can • Cease and Desist Order,
be examined once during each • Temporary Cease and
18-month period. Desist Order, and
• Prompt Corrective
The frequency of BHC Action (PCA) (see
inspections is dependent on below portion of this
the size, condition, and chart regarding PCA).
complexity of the institution.
B-2
BOG-- FOIA 10-251 --000246
Applicable
6) FHCs whose depository Formal corrective action is • Requires an agreement
institution subsidiaries become required under section 4(m) of between the FHC and the FRS
less than well capitalized or the BHC Act within 45 days of notification
are not well managed of deficiency.
• Institution must submit a plan
for corrective action.
• Institution must correct
deficiency within 180 days;
FRS may extend the deadline
based on reasonable cause.
7) Capital deterioration - FDICIA PCA provisions
Bank capital deterioration: apply to bank capital levels.
These provisions do not apply
to BHC capital levels.
Well capitalized No action required
Adequately capitalized No action required
Undercapitalized FDICIA PCA provisions Increase monitoring. The
apply to bank capital levels. following conditions apply:
These provisions do not apply • Capital restoration plan is
to BHC capital levels. required;
• Parent BHC must guaranty
bank’s capital plan;
• Cessation of dividends; and
• Limitation on management
fees paid to controlling
persons.
Significantly FDICIA PCA provisions Conditions (see above) for
undercapitalized apply to bank capital levels. “Undercapitalized” banks apply.
These provisions do not apply Mandatory and discretionary
to BHC capital levels. restrictions include:
• Sale of shares to
increase capital;
• Sale or merger of bank;
• Restrictions on
transactions with
affiliates;
• Restrictions on interest
rates; and
• Restrictions on senior
officer compensation.
Critically undercapitalized FDICIA PCA provisions Conditions (see above) for
apply to bank capital levels. “Undercapitalized” and
These provisions do not apply “Significantly Undercapitalized”
to BHC capital levels. banks apply. The Federal
Deposit Insurance Corporation
(FDIC) may be appointed
receiver within 90 days.
B-3
BOG-- FOIA 10-251 --000247
Applicable
BHC capital deterioration BHC Act BHC capital deterioration may
trigger informal or formal action
such a Memorandum of
Understanding, Written
Agreement, or Cease and Desist
Order.
8) Bank & BHC insolvency
• Bank insolvency or Federal Deposit Insurance Act FDIC is generally appointed
other factors identified receiver.
by the chartering
agency (state banking
department or OCC)
that are likely to result
in losses to the federal
deposit insurance fund
• BHC insolvencies N/A: BHC insolvencies fall N/A
under federal bankruptcy
laws.
B-4
BOG-- FOIA 10-251 --000248
Subject: Re: derivatives
Date: 09/14/2008 04:51 AM
Attachments: aig-derivatives.doc
sorry I overlooked this and didn't put this in the memo I circulated yesterday
evening. It's good stuff.
Office: 202-452-3579
Mobile: 703-340-4542
Michael S
Gibson/Board/FRS
To Jon D Greenlee/BOARD/FRS@BOARD, William B
Sent by: Michael S
Gibson/BOARD/FRS
Nelson/BOARD/FRS@BOARD, Christopher
Calabia/NY/FRS@FRS, Adam Ashcraft/NY/FRS@FRS,
Alejandro LaTorre/NY/FRS@FRS, Roberto
Perli/BOARD/FRS@BOARD, James A
09/13/2008 01:57 PM Clouse/BOARD/FRS@BOARD
cc
Subject derivatives
I've written up a page on derivatives with the limited information I

have. If anyone can fill in any details, please do so.
Mike
BOG-- FOIA 10-251 --000249

(b) (5)
BOG-- FOIA 10-251 --000250

(b) (5)
BOG-- FOIA 10-251 --000251

Cc: James A Clouse; Jon D Greenlee; Michael S Gibson; Roberto Perli; William B English
Date: 09/14/2008 05:00 AM
Attachments: AIG memo v2.mg.bfm.doc
I added a few comments to Mike's.
Michael S
Gibson/Board/FRS
To William B English/BOARD/FRS@BOARD, Michael S
Sent by: Michael S
Gibson/BOARD/FRS@BOARD, Brian F
Gibson/BOARD/FRS
Clouse/BOARD/FRS@BOARD, Jon D
Perli/BOARD/FRS@BOARD
09/13/2008 09:27 PM cc
Subject
Bill,
Mike
[attachment "AIG memo v2.mg.doc" deleted by Brian F

Madigan/BOARD/FRS]
William B
English/BOARD/FRS
cc
Duplicate
BOG-- FOIA 10-251 --000252

(b) (5)
BOG-- FOIA 10-251 --000253

(b) (5)
BOG-- FOIA 10-251 --000254

(b) (5)
BOG-- FOIA 10-251 --000255

(b) (5)
BOG-- FOIA 10-251 --000256

(b) (5)
BOG-- FOIA 10-251 --000257

(b) (5)
BOG-- FOIA 10-251 --000258

(b) (5)
BOG-- FOIA 10-251 --000259

(b) (5)
BOG-- FOIA 10-251 --000260

To: Brian F Madigan
Cc: James A Clouse; Michael S Gibson; Roberto Perli; William B English
Date: 09/14/2008 07:32 AM
(b) (5)
Thanks
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
Brian F
Madigan/BOARD/FRS
cc James A Clouse/BOARD/FRS@BOARD, Jon D
Greenlee/BOARD/FRS@BOARD, Michael S
09/14/2008 05:00 AM Gibson/BOARD/FRS@BOARD, Roberto
Subject
Duplicate
BOG-- FOIA 10-251 --000261

From: Adam Ashcraft
Subject: Fw: AIG and the discount window
Date: 09/14/2008 08:10 AM
Attachments: aig 20080914.doc
ML-S&P on AIG.pdf
Citi-AIG new stock price 9-2008.pdf
Adam B. Ashcraft
(212) 720-1617 phone
(212) 720-8363 fax
(646) 206-6175 cell
-----------------------------------------------------------------------------------------------------
----- Forwarded by Adam Ashcraft/NY/FRS on 09/14/2008 08:10 AM -----
Adam
Ashcraft/NY/FRS
To Adam Ashcraft/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS, Arthur Angulo/NY/FRS@FRS,
Beverly Hirtle/NY/FRS@FRS, Brian
09/14/2008 08:13 AM Peters/NY/FRS@FRS, Catherine Voigts/NY/FRS@FRS,
Chris Burke/NY/FRS@FRS, Hayley
Boesky/NY/FRS@FRS, Jamie McAndrews/NY/FRS@FRS,
Jim Mahoney/NY/FRS@FRS, Meg
McConnell/NY/FRS@FRS, Patricia
Mosser/NY/FRS@FRS, Til Schuermann/NY/FRS@FRS,
Tobias Adrian/NY/FRS@FRS, Warren
Hrung/NY/FRS@FRS
cc
Subject AIG and the discount window
Short comment on the AIG situation, with references attached. One if the Merril
note Warren circulated yesterday.
(b) (5)
BOG-- FOIA 10-251 --000262

Adam B. Ashcraft
(212) 720-1617 phone
(212) 720-8363 fax
(646) 206-6175 cell
-----------------------------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000263

(b) (5)
BOG-- FOIA 10-251 --000264

(b) (5)
BOG-- FOIA 10-251 --000265

(b) (4)
BOG-- FOIA 10-251 --000266

(b) (4)
BOG-- FOIA 10-251 --000267

(b) (4)
BOG-- FOIA 10-251 --000268

(b) (4)
BOG-- FOIA 10-251 --000269

(b) (4)
BOG-- FOIA 10-251 --000270

(b) (4)
BOG-- FOIA 10-251 --000271

(b) (4)
BOG-- FOIA 10-251 --000272

(b) (4)
BOG-- FOIA 10-251 --000273

(b) (4)
BOG-- FOIA 10-251 --000274

(b) (4)
BOG-- FOIA 10-251 --000275

(b) (4)
BOG-- FOIA 10-251 --000276

(b) (4)
BOG-- FOIA 10-251 --000277

(b) (4)
BOG-- FOIA 10-251 --000278

(b) (4)
BOG-- FOIA 10-251 --000279

(b) (4)
BOG-- FOIA 10-251 --000280

(b) (4)
BOG-- FOIA 10-251 --000281

(b) (4)
BOG-- FOIA 10-251 --000282

(b) (4)
BOG-- FOIA 10-251 --000283

(b) (4)
BOG-- FOIA 10-251 --000284

(b) (4)
BOG-- FOIA 10-251 --000285

To: Jon D Greenlee
Cc: James A Clouse; Michael S Gibson; Roberto Perli; William B English
Date: 09/14/2008 08:18 AM
Colleagues,
We need very quickly to draft the section on solvency. It does not need to be long
or detailed, but needs to get across the most recent reported figures and our basic
judgment about the firm's solvency. (b) (5)
b
Thanks,
Brian

Jon D
Greenlee/BOARD/FRS
cc James A Clouse/BOARD/FRS@Board, Michael S
Gibson/BOARD/FRS@Board, Roberto
09/14/2008 07:32 AM Perli/BOARD/FRS@Board, William B
English/BOARD/FRS@Board
Subject
Duplicate
BOG-- FOIA 10-251 --000286

To: James A Clouse; Roberto Perli; Brian F Madigan; William B English
Subject: press coverage of AIG's efforts to sell assets
Date: 09/14/2008 09:15 AM
AIG plans $20 billion asset sell-off - paper

14 Sep, 2008, 1729 hrs IST, REUTERS
LONDON: American International Group, the world's biggest insurer, is planning a $20
billion asset sell-off as it fights to correct a slump in its shares and braces for the impact of
Hurricane Ike, a London based newspaper said. The newspaper, without citing sources, said
details of the plan could come as early as Monday.
It said assets under the hammer included Transatlantic Holdings, AIG's New York-listed
reinsurance group, and that Europe's Swiss Re and Munich Re were potential buyers. AIG
and Swiss Re could not immediately be reached for comment.
Munich Re declined to comment. A source familiar with developments said that AIG could
announce details of its turnaround plan much sooner than expected, including possible asset
sales and how it will shore up capital. Media reports on Friday said that AIG could hold an
investor call as early as Monday, and that the insurer had hired JPMorgan to advise it on
raising fresh capital.
AIG has been hit hard by the global credit crunch and its shares plunged as much as 34.5
per cent on Friday, stepping up the pressure for quick action. A portfolio of credit default
swaps AIG wrote to guarantee securities linked to subprime mortgages has triggered
cumulative losses of $18 billion over the past 3 quarters.
Office: 202-452-3579
Mobile: 703-340-4542
wnelson@frb.gov
To wnelson@frb.gov
cc
09/14/2008 09:11 AM
Subject ~Possible Untrusted Sender~ Economic Times
BOG-- FOIA 10-251 --000287

Dear wnelson@frb.gov, wnelson@frb.gov believes you should read this article from
Economic Times.com. Please click on the link below to go to the page. If you think someone
you know would like to read it too, do mail it to them.
Check This Out!!!
Log on to : http://www.economictimes.indiatimes.com Best regards, Team Indiatimes The

Economic Times
BOG-- FOIA 10-251 --000288

To: Alejandro LaTorre; Richard Charlton; Tobias Adrian; jim.mahoney@ny.frb.org; Catherine Voigts; Adam
Ashcraft; Michael Schetzel; Christopher Calabia; Brian F Madigan; Deborah P Bailey; Scott Alvarez; Jon D
Greenlee; Michael S Gibson; christine.cumming@ny.frb.org; Terrence Checki; Elise Liebers
Cc: Carol Grunwald
Subject: Conference Call re AIG w/ NYS Dept of Ins at 10:30
Date: 09/14/2008 10:01 AM
Details below. Please invite appropriate folks from your area. Main topic of
discussin will be NYSID's view of financial health of the insurance subs. We will not
be talking about derivatives book.
(b) (5)
----- Forwarded by Patricia Mosser/NY/FRS on 09/14/2008 09:54 AM -----
KWall@ins.state.ny.us
To patricia.mosser@ny.frb.org
cc
09/14/2008 09:49 AM
Subject Call w/ NYS Dept of Ins
Dial-in: 888 296 6500

Passcode: 7342442
Time; 10;30 am
Please share with your colleages.
If you have any difficulty or any questions, feel free to contact me at 917
577 0440.
BOG-- FOIA 10-251 --000289

To: Steven M Durfey
Subject: Re: Previous email
Date: 09/14/2008 10:08 AM
I have been paang the stuff on to them also...

Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
▼ Steven M Durfey

From: Steven M Durfey
Sent: 09/14/2008 09:01 AM CDT
Subject: Re: Previous email
Good (?) morning - I used to look forward to weekends?
Anyway, I think you have something from Joe on Leh that Ray shared
with Diane/Cahill, and we are still pulling together stuff for AIG.
Tks,
Durf
Steven M Durfey
Large Bank Division
Telephone 312-322-6844
Mobile 312-953-6824
Fax 312-322-5833
▼ Coryann Stefansson/BOARD/FRS@BOARD
Coryann
Stefansson/BOARD/FRS@BOARD
To Suzanna Costello/ATL/FRS@FRS, James
Barnes/RICH/FRS@FRS, Steven M
Durfey/BSR/CHI/FRS@FRS,
09/13/2008 12:08 PM Ron.Feldman@mpls.frb.org,
Nadine.M.Wallman@clev.frb.org, Suzanne
Killian/BOARD/FRS@BOARD, Phyllis L
Harwell/BOARD/FRS@BOARD, William
Charwat/BOARD/FRS, Chris
Haley/BOS/FRS@FRS, Kim
Jensik/BOARD/FRS@BOARD, Jon D
Greenlee/BOARD/FRS, Jerrold L
Newlon/CLEV - BSR12/CLEV/FRS@FRS
cc
Subject Previous email
At this point, I need you not to go to your banks regarding AIG or

Lehman but rather to go to you internal MIS to determine the impact
of a bankruptcy of Lehman or AIG to your organization.....
BOG-- FOIA 10-251 --000290

thanks
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
BOG-- FOIA 10-251 --000291

To: Adam.Ashcraft@ny.frb.org
Subject: Re: Fw: AIG and the discount window
Date: 09/14/2008 10:19 AM
Attachments: aig 20080914.doc
ML-S&P on AIG.pdf
Citi-AIG new stock price 9-2008.pdf
Adam,
(b) (5)
Mike
Adam
Ashcraft/NY/FRS@F
RS To
Michael S Gibson/BOARD/FRS@BOARD
09/14/2008 08:10 cc
AM
Subject
Fw: AIG and the discount window
Adam B. Ashcraft
(212) 720-1617 phone
(212) 720-8363 fax
(646) 206-6175 cell
----------------------------------------------------------------------------
-------------------------
The contents of this e-mail reflect the opinion of the author and not the
opinion of the Federal Reserve Bank of New York or the Federal Reserve
System.
----- Forwarded by Adam Ashcraft/NY/FRS on 09/14/2008 08:10 AM -----
Adam
Ashcraft/NY/FRS
To
09/14/2008 08:13 Adam Ashcraft/NY/FRS@FRS, Alejandro
AM LaTorre/NY/FRS@FRS, Arthur
Angulo/NY/FRS@FRS, Beverly
BOG-- FOIA 10-251 --000292

Hirtle/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, Chris
Burke/NY/FRS@FRS, Hayley
Boesky/NY/FRS@FRS, Jamie
McAndrews/NY/FRS@FRS, Jim
Mahoney/NY/FRS@FRS, Meg
McConnell/NY/FRS@FRS, Patricia
Mosser/NY/FRS@FRS, Til
Schuermann/NY/FRS@FRS, Tobias
Adrian/NY/FRS@FRS, Warren
Hrung/NY/FRS@FRS
cc
Subject
AIG and the discount window
Duplicate
BOG-- FOIA 10-251 --000293

Meeting Invitation:
Calendar Entry
Subject: Fw: Call w/ NYS Dept of Ins / Dial-in: 888 296 6500 / Passcode: 7342442
When
Date: Sunday 09/14/2008
Time: 10:30 AM - 11:00 AM (0 hours 30 minutes)
Chair: Carol Grunwald
Invitees
Required (to): Adam Ashcraft/NY/FRS@FRS; Alejandro LaTorre/NY/FRS@FRS@NY; Brian F Madigan/BOARD/FRS@BOARD;
Catherine Voigts/NY/FRS@FRS; Christine Cumming/NY/FRS@FRS; Christopher Calabia/NY/FRS@FRS; Deborah P
Bailey/BOARD/FRS@BOARD; Jim Mahoney/NY/FRS@FRS; Jon D Greenlee/BOARD/FRS@BOARD; Michael S
Gibson/BOARD/FRS@BOARD; Michael Schetzel/NY/FRS@FRS; Patricia Mosser/NY/FRS@FRS; Richard
Charlton/NY/FRS@FRS; Scott Alvarez/BOARD/FRS@BOARD; Terrence Checki/NY/FRS@FRS; Tobias
Adrian/NY/FRS@FRS; William Rutledge/NY/FRS@FRS@NY
Optional (cc):
Where
Location: M9 MKT Library/NY Main Building@FRS
Details below. Please invite appropriate folks from your area. Main topic of
discussin will be NYSID's view of financial health of the insurance subs. We will not
be talking about derivatives book.
(b) (5)
cc
09/14/2008 09:49 AM
Dial-in: 888 296 6500

Passcode: 7342442
Time; 10;30 am
577 0440.
BOG-- FOIA 10-251 --000294

cc
09/14/2008 09:49 AM
Dial-in: 888 296 6500

Passcode: 7342442
Time; 10;30 am
577 0440.
BOG-- FOIA 10-251 --000295

From: Christopher Calabia
To: Patricia Mosser
Cc: Adam Ashcraft; Alejandro LaTorre; Brian F Madigan; Carol Grunwald; Catherine Voigts;
christine.cumming@ny.frb.org; Deborah P Bailey; jim.mahoney@ny.frb.org; Jon D Greenlee; Michael S Gibson;
Michael Schetzel; Richard Charlton; Scott Alvarez; Terrence Checki; Tobias Adrian; William Rutledge
Subject: Re: Fw: Call w/ NYS Dept of Ins at 8:30 re AIG
Date: 09/14/2008 10:25 AM
Chris Calabia & Elise Liebers will lead the discussion of item #2; other supervisors
may ask follow-ups.
Patricia
Mosser/NY/FRS
09/14/2008 10:11 AM Voigts/NY/FRS@FRS, Adam Ashcraft/NY/FRS@FRS,
Michael Schetzel/NY/FRS, Scott
Bailey/BOARD/FRS@BOARD, Brian F
Calabia/NY/FRS, christine.cumming@ny.frb.org,
Terrence Checki/NY/FRS, Jon D
Gibson/BOARD/FRS@BOARD, William
Rutledge/NY/FRS@FRS@NY
cc Carol Grunwald/NY/FRS
Subject Fw: Call w/ NYS Dept of Ins at 8:30 re AIG
Duplicate
BOG-- FOIA 10-251 --000296

To: Patricia Mosser
christine.cumming@ny.frb.org; Deborah P Bailey; jim.mahoney@ny.frb.org; Jon D Greenlee; Michael S Gibson;
Michael Schetzel; Richard Charlton; Scott Alvarez; Terrence Checki; Tobias Adrian; William Rutledge
Subject: URGENT -- call delayed by 5 minutes
Date: 09/14/2008 10:29 AM
We've been asked to call in at 10:35 -- the insurance department is still on the line
on another call. We'll call in again in 5 minutes!
Patricia
Mosser/NY/FRS
09/14/2008 10:11 AM Voigts/NY/FRS@FRS, Adam Ashcraft/NY/FRS@FRS,
Michael Schetzel/NY/FRS, Scott
Bailey/BOARD/FRS@BOARD, Brian F
Calabia/NY/FRS, christine.cumming@ny.frb.org,
Terrence Checki/NY/FRS, Jon D
Gibson/BOARD/FRS@BOARD, William
Rutledge/NY/FRS@FRS@NY
cc Carol Grunwald/NY/FRS
Subject Fw: Call w/ NYS Dept of Ins at 8:30 re AIG
Duplicate
BOG-- FOIA 10-251 --000297

To: Patricia Mosser
Subject: Get on the aig call now
Date: 09/14/2008 10:31 AM
Office: 202-452-3579
Mobile: 202-725-3612
BOG-- FOIA 10-251 --000298

To: Christopher Calabia
christine.cumming@ny.frb.org; Deborah P Bailey; jim.mahoney@ny.frb.org; Michael S Gibson; Michael Schetzel;
Patricia Mosser; Richard Charlton; Scott Alvarez; Terrence Checki; Tobias Adrian; William Rutledge
Subject: Re: URGENT -- call delayed by 5 minutes
Date: 09/14/2008 10:31 AM
They are on now and ready to go.
Jon Greenlee
Associate Director
Phone (202) 452-2962
▼ Christopher Calabia/NY/FRS@FRS
Christopher
Calabia/NY/FRS@FRS
To Patricia Mosser/NY/FRS@FRS
cc Adam Ashcraft/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS, Brian F
09/14/2008 10:29 AM Madigan/BOARD/FRS@BOARD, Carol
Grunwald/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, christine.cumming@ny.frb.org,
Deborah P Bailey/BOARD/FRS@BOARD,
jim.mahoney@ny.frb.org, Jon D
Gibson/BOARD/FRS@BOARD, Michael
Schetzel/NY/FRS@FRS, Richard Charlton/NY/FRS@FRS,
Scott Alvarez/BOARD/FRS@BOARD, Terrence
Checki/NY/FRS@FRS, Tobias Adrian/NY/FRS@FRS,
William Rutledge/NY/FRS@FRS
Subject
URGENT -- call delayed by 5 minutes
Duplicate
Duplicate
BOG-- FOIA 10-251 --000299

From: Adam Ashcraft
Date: 09/14/2008 10:33 AM
Good suggestion
I don't know how much can be done today but will try to take a look
(b) (5)
--------------------------

Sent: 09/14/2008 10:19 AM EDT
To: Adam Ashcraft
Adam,
Duplicate
BOG-- FOIA 10-251 --000300

To: Jon D Greenlee
christine.cumming@ny.frb.org; Deborah P Bailey; jim.mahoney@ny.frb.org; Michael S Gibson; Michael Schetzel;
Patricia Mosser; Richard Charlton; Scott Alvarez; Terrence Checki; Tobias Adrian; William Rutledge
Subject: Re: URGENT -- call delayed by 5 minutes
Date: 09/14/2008 10:35 AM
thanks, we are back on.

▼ Jon D Greenlee/BOARD/FRS@BOARD
Jon D
To Christopher Calabia/NY/FRS@FRS
LaTorre/NY/FRS@FRS, Brian F
09/14/2008 10:35 AM Madigan/BOARD/FRS@Board, Carol
Grunwald/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS,
christine.cumming@ny.frb.org, Deborah P
Bailey/BOARD/FRS@Board,
jim.mahoney@ny.frb.org, Michael S
Gibson/BOARD/FRS@Board, Michael
Schetzel/NY/FRS@FRS, Patricia
Mosser/NY/FRS@FRS, Richard
Charlton/NY/FRS@FRS, Scott
Alvarez/BOARD/FRS@Board, Terrence
Checki/NY/FRS@FRS, Tobias
Adrian/NY/FRS@FRS, William
Rutledge/NY/FRS@FRS
Subject
Re: URGENT -- call delayed by 5 minutes
They are on now and ready to go.
Jon Greenlee
Associate Director
Phone (202) 452-2962
▼ Christopher Calabia/NY/FRS@FRS
Duplicate
BOG-- FOIA 10-251 --000301

To: William.R.Nelson@frb.gov; Roberto.Perli@frb.gov
Subject: paragraphs
Date: 09/14/2008 11:42 AM
(b) (5)
BOG-- FOIA 10-251 --000302

To: Patricia Mosser
Cc: Christopher Calabia; William R Nelson
Subject: Re: questions on call
Date: 09/14/2008 12:24 PM
(b) (5)
Patricia
Mosser/NY/FRS
cc Christopher Calabia/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS@NY
09/14/2008 11:51 AM
Subject
Re: questions on call
(b) (5)
Alex is going to contact the Treasurer this morning to get clarity on the plan.....
▼ William R Nelson/BOARD/FRS@BOARD
William R
Nelson/BOARD/FRS@BOARD
To Patricia Mosser/NY/FRS@FRS
cc Christopher Calabia/NY/FRS@FRS
09/14/2008 11:43 AM Subject questions on call
(b) (5)
thanks
Bill
BOG-- FOIA 10-251 --000303

Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000304

Subject: aig memo
Date: 09/14/2008 01:23 PM
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000305

(b) (5)
BOG-- FOIA 10-251 --000306

(b) (5)
BOG-- FOIA 10-251 --000307

(b) (5)
BOG-- FOIA 10-251 --000308

(b) (5)
BOG-- FOIA 10-251 --000309

(b) (5)
BOG-- FOIA 10-251 --000310

(b) (5)
BOG-- FOIA 10-251 --000311

(b) (5)
BOG-- FOIA 10-251 --000312

(b) (5)
BOG-- FOIA 10-251 --000313

(b) (5)
BOG-- FOIA 10-251 --000314

(b) (5)
BOG-- FOIA 10-251 --000315

(b) (5)
BOG-- FOIA 10-251 --000316

(b) (5)
BOG-- FOIA 10-251 --000317

To: Norah Barger; Roger.Cole@frb.gov
Subject: Fw: Anything on AIG
Date: 09/14/2008 01:57 PM
Jon D
Greenlee/BOARD/FRS
cc
09/14/2008 01:39 PM Subject
Re: Anything on AIG
We had a call with NY State Insurance Department this morning. It sounded a bit
more promising than yesterday and (b)(5)&(b)(8)
compared with the Lehman situation
(b)(5)&(b)(8)
Diane Fraser is typing up a more complete version of the call.
Jon
BOG-- FOIA 10-251 --000318

Jon Greenlee
Associate Director
Phone (202) 452-2962
Deborah P
Bailey/BOARD/FRS
To Jon D Greenlee/BOARD/FRS
cc
09/14/2008 01:16 PM Subject Anything on AIG
--------------------------
BOG-- FOIA 10-251 --000319

To: Michael S Gibson; Roberto Perli
Subject: aig memo
Date: 09/14/2008 02:03 PM
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000320

(b) (5)
BOG-- FOIA 10-251 --000321

(b) (5)
BOG-- FOIA 10-251 --000322

(b) (5)
BOG-- FOIA 10-251 --000323

(b) (5)
BOG-- FOIA 10-251 --000324

(b) (5)
BOG-- FOIA 10-251 --000325

(b) (5)
BOG-- FOIA 10-251 --000326

(b) (5)
BOG-- FOIA 10-251 --000327

(b) (5)
BOG-- FOIA 10-251 --000328

(b) (5)
BOG-- FOIA 10-251 --000329

(b) (5)
BOG-- FOIA 10-251 --000330

(b) (5)
BOG-- FOIA 10-251 --000331

To: Jon D Greenlee
Subject: aig memo
Date: 09/14/2008 02:06 PM
Jon,
here is the current draft of the memo for your comments. If you can't comment till
later, check with my for a fresh draft.
thanks Attachment is a duplicate
Bill
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000332

To: Jon D Greenlee
Subject: Fw: aig memo
Date: 09/14/2008 02:26 PM
you might want to hold off commenting on this.
Office: 202-452-3579
Mobile: 703-340-4542
William R
Nelson/BOARD/FRS
cc
09/14/2008 02:06 PM Subject aig memo
Duplicate
BOG-- FOIA 10-251 --000333

To: Jon D Greenlee
Subject: Re: Fw: aig memo
Date: 09/14/2008 02:28 PM
Brian M. thinks it is unlikely it will go to the Board.
Office: 202-452-3579
Mobile: 703-340-4542
Jon D
Greenlee/BOARD/FRS
cc
09/14/2008 02:27 PM Subject
Re: Fw: aig memo
okay - I was making some edits
Jon Greenlee
Associate Director
Phone (202) 452-2962
William R
Nelson/BOARD/FRS
cc
09/14/2008 02:26 PM Subject Fw: aig memo
Duplicate
BOG-- FOIA 10-251 --000334

Cc: Roberto Perli; William B English
Subject: Re: aig memo
Date: 09/14/2008 02:43 PM
Attachments: AIG memo v3.mg.doc
My comments...
William R
Nelson/BOARD/FRS
To Michael S Gibson/BOARD/FRS@BOARD, Roberto
cc
09/14/2008 02:03 PM
Subject aig memo
[attachment "AIG memo v3.doc" deleted by Michael S

Gibson/BOARD/FRS]
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000335

(b) (5)
BOG-- FOIA 10-251 --000336

(b) (5)
BOG-- FOIA 10-251 --000337

(b) (5)
BOG-- FOIA 10-251 --000338

(b) (5)
BOG-- FOIA 10-251 --000339

(b) (5)
BOG-- FOIA 10-251 --000340

(b) (5)
BOG-- FOIA 10-251 --000341

(b) (5)
BOG-- FOIA 10-251 --000342

(b) (5)
BOG-- FOIA 10-251 --000343

(b) (5)
BOG-- FOIA 10-251 --000344

(b) (5)
BOG-- FOIA 10-251 --000345

(b) (5)
BOG-- FOIA 10-251 --000346

From: Roberto Perli
Cc: Michael S Gibson; William B English
Date: 09/14/2008 02:52 PM
Attachments: AIG memo v3.perli.doc
A few comments.
William R
Nelson/BOARD/FRS
To Michael S Gibson/BOARD/FRS@BOARD, Roberto
cc
09/14/2008 02:03 PM
Subject aig memo
[attachment "AIG memo v3.doc" deleted by Roberto Perli/BOARD/FRS]
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000347

(b) (5)
BOG-- FOIA 10-251 --000348

(b) (5)
BOG-- FOIA 10-251 --000349

(b) (5)
BOG-- FOIA 10-251 --000350

(b) (5)
BOG-- FOIA 10-251 --000351

(b) (5)
BOG-- FOIA 10-251 --000352

(b) (5)
BOG-- FOIA 10-251 --000353

(b) (5)
BOG-- FOIA 10-251 --000354

(b) (5)
BOG-- FOIA 10-251 --000355

(b) (5)
BOG-- FOIA 10-251 --000356

(b) (5)
BOG-- FOIA 10-251 --000357

(b) (5)
BOG-- FOIA 10-251 --000358

To: Roberto Perli
Date: 09/14/2008 02:53 PM
Attachments: AIG memo v3.perli.doc
thanks.
Office: 202-452-3579
Mobile: 703-340-4542
▼ Roberto Perli/BOARD/FRS
Roberto
Perli/BOARD/FRS
cc Michael S Gibson/BOARD/FRS@BOARD, William B
09/14/2008 02:52 PM
Subject
Re: aig memo
Duplicate
BOG-- FOIA 10-251 --000359

F om Diane ase @f b gov
To l f
Cc Diane ase @f b gov
Subject Re My p opo ed nse t to Moneta y Affai s pa ial memo d aft
Date 09/14/2008 03 02 M
Attachments AIG memo v2 mg bfm - D d ts 9-14-08 doc
. . .plus some cosmetic ni s I ed ted.
Jon, wou d you please let me know of your comments.
Thanks,
D ane
Jon D
Greenlee BOARD FRS
o Diane
ase BOARD RS@BOARD
09 4 2008 07 33 AM
cc
Sub ect w a t al memo d a t
See my note be ow - can you work up a paragraph? I ll send the memo separa ely.
Jon Green ee
Assoc ate Direc or
Phone (202) 52-2962
---- o wa ded by on D G een ee BOARD RS on 09 4 2008 07 32 AM - ---
Jon D Green ee BOARD FRS

o B an
09 4 2008 07 32 AM Madigan BOARD RS@BOARD
cc ames A
C ouse BOARD RS@Boa d
Michael S
Gibson BOARD RS@Boa d
Robe to
e i BOARD RS@Boa d
Wi l am B
Engl sh BOARD RS@Boa d
Subject Re a ial memo d a t L nk

(b) (5)
Thanks
Jon
Jon Green ee
Assoc ate Direc or
Phone (202) 52-2962
Br an F Madigan BOARD FRS

o M chael S
09 4 2008 05 00 AM G bson BOARD RS@BOARD
cc ames A
C ouse BOARD RS@BOARD
on D
G een ee BOARD RS@BOARD
M chael S
G bson BOARD RS@BOARD
Robe o
e li BOARD RS@BOARD
W l iam B
Eng ish BOARD RS@BOARD
Sub ect Re a t al memo d a Link
I added a few comments to Mike s.
[attachment AIG memo v2.mg.bfm doc de eted by Jon D Greenlee/BOARD FRS]
Michael S Gibson Board FRS

Sent by Michael S o W l iam B
G bson BOARD RS Eng ish BOARD RS@BOARD
M chael S
G bson BOARD RS@BOARD
09 3 2008 09 27 M
B ian
Madigan BOARD RS@BOARD
ames A
C ouse BOARD RS@BOARD
on D
G een ee BOARD RS@BOARD
Robe o
e li BOARD RS@BOARD
cc
Sub ect Re a t al memo d a Link
B ll,
I added some deta ls, especia ly on the derivatives stuff.
Mike
[attachment AIG memo v2.mg.doc de eted by Brian F Madigan/BOARD/FRS]
Wil iam B
English BOARD FRS o Michael S
Gibson BOARD RS@BOARD
09 3 2008 05 32 M
cc
Subject a t al memo d a t
A tached is a rough dra t of the first part of our memo. I was not sure where to s op, so I put in some discuss on of the current problems (which may over ap w th Jon's discussion of iquid ty in the second section) and of the possible spil overs (which may over ap w th the Ne son/Clouse discussion of the pros and cons of lending).
Comments very welcome, (b) (5)

B ll E.
[attachment AIG memo v2.doc de eted by Michael S Gibson BOARD/FRS] [attachment Binder1.pdf deleted by Michael S Gibson/BOARD/FRS]
- AIG memo 2 mg fm - DF edits 9-14-08 doc
BOG-- FOIA 10-251 --000360

(b) (5)
BOG-- FOIA 10-251 --000361

(b) (5)
BOG-- FOIA 10-251 --000362

(b) (5)
BOG-- FOIA 10-251 --000363

(b) (5)
BOG-- FOIA 10-251 --000364

(b) (5)
BOG-- FOIA 10-251 --000365

(b) (5)
BOG-- FOIA 10-251 --000366

(b) (5)
BOG-- FOIA 10-251 --000367

(b) (5)
BOG-- FOIA 10-251 --000368

To: Diane Fraser
Subject: Re: My proposed insert to Monetary Affairs partial memo draft
Date: 09/14/2008 03:04 PM
Thanks - i just heard from Bill Nelson that they are going to hold off on the memo
for right now. Good you did this just in case.
Again, thanks for everything you've done on your weekend.
Jon
--------------------------
▼ Diane Fraser

From: Diane Fraser
Sent: 09/14/2008 03:02 PM EDT
To: Jon Greenlee
Cc: Diane Fraser
. . .plus some cosmetic nits I edited.
Jon, would you please let me know of your comments.

[attachment "AIG memo v2.mg.bfm - DF edits 9-14-08.doc" deleted by Jon D
Greenlee/BOARD/FRS]
Thanks,
Diane
Jon D
Greenlee/BOARD/FRS
To Diane Fraser/BOARD/FRS@BOARD
cc
09/14/2008 07:33 AM Subject Fw: Partial memo draft
See my note below - can you work up a paragraph? I'll send the
memo separately.
Jon Greenlee
Associate Director
Phone (202) 452-2962
----- Forwarded by Jon D Greenlee/BOARD/FRS on 09/14/2008 07:32 AM -----
BOG-- FOIA 10-251 --000369

Jon D
Greenlee/BOARD/FRS
cc James A Clouse/BOARD/FRS@Board, Michael S
Gibson/BOARD/FRS@Board, Roberto
09/14/2008 07:32 AM Perli/BOARD/FRS@Board, William B
English/BOARD/FRS@Board
Subject
(b) (5)
Thanks
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
Brian F
Madigan/BOARD/FRS
cc James A Clouse/BOARD/FRS@BOARD, Jon D
09/14/2008 05:00 AM Gibson/BOARD/FRS@BOARD, Roberto
Subject
I added a few comments to Mike's.
[attachment "AIG memo v2.mg.bfm.doc" deleted by Jon D

Greenlee/BOARD/FRS]
BOG-- FOIA 10-251 --000370

Michael S
Gibson/Board/FRS
To William B English/BOARD/FRS@BOARD, Michael S
Sent by: Michael S
Gibson/BOARD/FRS@BOARD, Brian F
Gibson/BOARD/FRS
Clouse/BOARD/FRS@BOARD, Jon D
09/13/2008 09:27 PM cc
Subject
Bill,
Mike
[attachment "AIG memo v2.mg.doc" deleted by Brian F

Madigan/BOARD/FRS]
William B
English/BOARD/FRS
cc
Attached is a rough draft of the first part of our memo. I was not sure
where to stop, so I put in some discussion of the current problems
(which may overlap with Jon's discussion of liquidity in the second
section) and of the possible spillovers (which may overlap with the
Nelson/Clouse discussion of the pros and cons of lending).
(b) (5)
Comments very welcome,

Bill E.
[attachment "AIG memo v2.doc" deleted by Michael S

Gibson/BOARD/FRS] [attachment "Binder1.pdf" deleted by Michael S
Gibson/BOARD/FRS]
BOG-- FOIA 10-251 --000371

To: BSR LIG
Subject: Fw: Draft LFI Conference Call Notes - 9/13/08 7pm call - Revised Version
Date: 09/14/2008 03:20 PM
Attachments: Conference Call Notes 9.13.08 evening version 2.doc
some of this may be out dated but I thought that i would forward
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
Stacy
O'Bryant/RICH/FRS@FRS
To Sarah Dahlgren/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Michael
Johnson/SF/FRS@FRS, Jennifer
09/13/2008 09:42 PM Burns/RICH/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD, Coryann
Stefansson/BOARD/FRS@BOARD, Chris
Haley/BOS/FRS@FRS, Raymond A
Bacon/BSR/CHI/FRS@FRS
cc
Subject Draft LFI Conference Call Notes - 9/13/08 7pm call
- Revised Version
Restricted F.R.
Much better version of notes - thanks to Jennifer!

Stacy O'Bryant
LFI/LCBO Project Manager, Banking Supervision and Regulation/Large
Complex Bank Organizations
The Federal Reserve Bank of Richmond, Charlotte Branch
Office 704· 280· 0570
stacy.o'bryant@rich.frb.org
www.richmondfed.org
BOG-- FOIA 10-251 --000372

Restricted F.R. Page 1 Date: September 13, 2008
Author: S. O’Bryant
Meeting Date: September 13, 2008 (7 p.m. EST)

Meeting Subject: LFIT Conference Call
Purpose: LFIT/RSO Discussion on Market Events and Issues
Key Takeaways:
Not Responsive
BOG-- FOIA 10-251 --000373

Not Responsive
BOG-- FOIA 10-251 --000374

Not Responsive
• AIG
(b)(4) & (b)(5)
•
• (b)(4) & (b)(5)
• LT Strategy - (b)(4) & (b)(5)

(b)(4) & (b)(5)
• Tobias Adrian – looked at AIG from an systemic risk perspective;

(b) (5)
• (b)(4) & (b)(5)
Not Responsive
BOG-- FOIA 10-251 --000375

Not Responsive
BOG-- FOIA 10-251 --000376

To: Brian F Madigan
Subject: Fw: Liquidity Plans from AIG - Call with Insurance Regulators @ 10:30 today
Date: 09/14/2008 03:24 PM
Attachments: Pros and Cons of Lending to AIG.doc
Attached is a note we shared with Chris Cumming on pros and cons
----- Forwarded by Alejandro LaTorre/NY/FRS on 09/14/2008 03:23 PM -----
Catherine
Voigts/NY/FRS
To Patricia Mosser/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS, Paul Whynott/NY/FRS@FRS,
Jim Mahoney/NY/FRS@FRS, Richard
09/14/2008 12:26 PM Charlton/NY/FRS@FRS, Tobias Adrian/NY/FRS@FRS,
Adam Ashcraft/NY/FRS@FRS
cc NY Banksup AIG Monitoring and Analysis
Subject Liquidity Plans from AIG - Call with Insurance
Regulators @ 10:30 today
As Trish requested - my summary:

(b)(4), (b)(5), & (b)(8)
BOG-- FOIA 10-251 --000377

(b)(4), (b)(5), & (b)(8)
If anyone has further recollection of relevant details, please feel free to add.
Thanks,
Cathy
* * * * * * * * *

Catherine Voigts
Credit Risk Advisor
Bank Supervision Group
Federal Reserve Bank
212-720-2383
BOG-- FOIA 10-251 --000378

(b) (5)
1
BOG-- FOIA 10-251 --000379
(b) (5)
2
BOG-- FOIA 10-251 --000380
To: Scott Alvarez; James A Clouse; William B English; William R Nelson; Roberto Perli; Michael S Gibson; Deborah P
Bailey; Jon D Greenlee
Subject: Fw: Liquidity Plans from AIG - Call with Insurance Regulators @ 10:30 today
Date: 09/14/2008 03:26 PM
FYI.
Alejandro
LaTorre/NY/FRS@FRS
cc
09/14/2008 03:24 PM Subject Fw: Liquidity Plans from AIG - Call with Insurance
Duplicate
Duplicate
BOG-- FOIA 10-251 --000381

From: Melissa A Vanlandingham
To: William Carlucci
Cc: Jeff Stehm
Subject: list of participants, affiliates, roles, etc
Date: 09/14/2008 03:29 PM
Attachments: Selected Affiliated Members of Payments and Settlement Systems September 2008.xlsm
Hi Bill,
Here's the list. It does not include all DTCC participants. I selected major family
groups, and have added more as appropriate. AIG is on it as of this morning. The
settling bank information is not complete (didn't have it all).
You can filter by group (Lehman, Citigroup, etc.).
Let me know if you have an questions. Or if you need someone else added.
Melissa Vanlandingham
Financial Services Analyst
Division of Reserve Bank Operations and Payment Systems
202-530-6285
BOG-- FOIA 10-251 --000382

BOG-- FOIA 10-251 --000383
From: William Carlucci
To: Melissa A Vanlandingham
Cc: Jeff Stehm
Subject: Re: list of participants, affiliates, roles, etc
Date: 09/14/2008 03:32 PM
Thank you Melissa. (b) (5)
Best Regards,
William Carlucci
Senior Bank Examiner
212-720-8969/212-855-3390 (DTC)
▼ Melissa A Vanlandingham/BOARD/FRS@BOARD
Melissa A
Vanlandingham/BOARD/FRS@BOARD
To William Carlucci/NY/FRS@FRS
cc Jeff Stehm/BOARD/FRS@BOARD
09/14/2008 03:32 PM Subject list of participants, affiliates, roles, etc
Hi Bill,
Duplicate
BOG-- FOIA 10-251 --000384

To: Jeff Stehm
Subject: Re: list of participants, affiliates, roles, etc
Date: 09/14/2008 03:38 PM
Okay, thank you.
Best Regards,
William Carlucci
212-720-8969/212-855-3390 (DTC)
▼ Jeff Stehm/BOARD/FRS@BOARD
Jeff
Stehm/BOARD/FRS@BOARD
To William Carlucci/NY/FRS@FRS
cc
09/14/2008 03:38 PM Subject
Re: list of participants, affiliates, roles, etc
Bill
(b) (5)
▼ William Carlucci

Sent: 09/14/2008 03:35 PM EDT
To: Melissa Vanlandingham
Cc: Jeff Stehm
Duplicate
BOG-- FOIA 10-251 --000385

To: William B English; Roberto Perli; Michael S Gibson; Jon D Greenlee
Cc: Brian F Madigan; James A Clouse
Subject: draft AIG memo
Date: 09/14/2008 03:55 PM
Here is the current draft of the AIG memo. No need for additional comments at this
time.
Bill
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000386

(b) (5)
BOG-- FOIA 10-251 --000387

(b) (5)
BOG-- FOIA 10-251 --000388

(b) (5)
BOG-- FOIA 10-251 --000389

(b) (5)
BOG-- FOIA 10-251 --000390

(b) (5)
BOG-- FOIA 10-251 --000391

(b) (5)
BOG-- FOIA 10-251 --000392

(b) (5)
BOG-- FOIA 10-251 --000393

(b) (5)
BOG-- FOIA 10-251 --000394

(b) (5)
BOG-- FOIA 10-251 --000395

(b) (5)
BOG-- FOIA 10-251 --000396

(b) (5)
BOG-- FOIA 10-251 --000397

(b) (5)
BOG-- FOIA 10-251 --000398

To: BSR LIG
Subject: Fw: LFI Exposures to AIG (9/13/08 AM Update)
Date: 09/14/2008 04:40 PM
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
To BSR LFIC
cc
09/13/2008 01:00 PM
RESTRICTED FR
---
Below and attached please find the most current version of LFI credit exposures to AIG. This data represents the best information
available, culled from the sources at hand (i.e. not reaching out directly to the firms). Using flow-basis traffic, we will work to update
this information over the course of today and going forward.
(b)(4), (b)(5), & (b)(8)
____________________________________
Brandon J. Hall
Counterparty Credit Risk Monitoring & Analysis
33 Liberty St. | New York, NY 10045
P: 212-720-1349
F: 212-720-1468
E: brandon.hall@ny.frb.org
BOG-- FOIA 10-251 --000399

BOG-- FOIA 10-251 --000400
From: Timothy Geithner
Sent By: Michael Held
To: (b) (6) ; Donald L Kohn
Subject: Fw: Pros and Cons on AIG lending
Date: 09/14/2008 04:41 PM
Counterparty Exposure Report 9142008.xls
AIG Subsidiaries.ppt
----- Forwarded by Michael Held/NY/FRS on 09/14/2008 04:40 PM -----
Alejandro
LaTorre/NY/FRS
LaTorre/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS, Elise Liebers/NY/FRS@FRS,
09/14/2008 03:49 PM Hayley Boesky/NY/FRS@FRS, Jim
Mahoney/NY/FRS@FRS, Patricia Mosser/NY/FRS@FRS,
Paul Whynott/NY/FRS@FRS, Richard
William Walsh/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, Timothy Geithner/NY/FRS@FRS,
Michael Silva/NY/FRS@FRS, Meg
McConnell/NY/FRS@FRS, William Dudley/NY/FRS@FRS,
William Rutledge/NY/FRS@FRS, Terrence
Checki/NY/FRS@FRS, Susan Stiehm/NY/FRS@FRS,
Arthur Angulo/NY/FRS@FRS
cc Tanshel Pointer/NY/FRS@FRS
Subject Pros and Cons on AIG lending
Attached are the following documents:
1. A note describing the pros and cons of lending to AIG
2. A spreadsheet provided by AIG detailing the firms with the largest exposures to
AIG (i.e. what firms stand to lose in the event of AIG default). The relevant column
is "Total Exposure to AIG, Ranked". With the exception of the "lending" column,
these figures are loss estimates. Derivative loss estimates are derived from current
MTM provided by AIG.
3. A presentation describing what we know on AIG subsidiaries based on publicly

available information.
If there are questions, let us know.
Regards,
Alex
BOG-- FOIA 10-251 --000401

(b) (5)
1
BOG-- FOIA 10-251 --000402
(b) (5)
2
BOG-- FOIA 10-251 --000403
(b)(4) & (b)(5)
BOG-- FOIA 10-251 --000404

Restricted FR
AIG Subsidiaries:
Are they a Source of Strength?
Chris Calabia, Erika Gottfried, Min Kim, Elise Liebers,

Alexander Psomas, Danielle Vicente

Sunday, September 13, 2008
BOG-- FOIA 10-251 --000405

(b) (5)
(b) (5)
AIG Revenues by Segment

(2007 $110.1 billion)
Asset
Management
, 4%
AIGFP, 8%
P&C, 42%
Life, 46%
BOG-- FOIA 10-251 --000406

Simplified Organizational Chart
American International Group, Inc (NY)
American Life Insur. Co (DE) SunAmerica Life (AZ)

Assets: $105.6 bn AIG Property Casualty Group AGC Life Insurance Co (MO) Assets: $38.0 bn
Capital: $7.1 bn Capital: $4.7bn
National Union Fire Ins (PA)

Assets: $34.2 bn See Next Slide First SunAmerica Life Ins (NY)
Capital: $12.2 bn
American Home Assur.(NY)

Assets: $27.9 bn AIG SunAmerica Life Assur. (AZ)
Capital: $6.5 bn
BOG-- FOIA 10-251 --000407

Life Insurance
AGC Life Insurance Co (Mo)
AIG Annuity Ins. Co (TX) American General Life Ins. Co. (TX) Amer. Int’l Life Assur. Co of NY (NY)
Assets: $53.1 bn Assets: $39.5 bn Assets: $7.0 bn
Capital: $3.2 bn Capital: $5.5 bn Capital: $0.4 bn
Variable Annuity Life Ins. Co. (TX)

Assets: $62.9 bn
Capital: $ 2.9bn
BOG-- FOIA 10-251 --000408

AIG - Summary of Financial and Ratings Information of Major Subsidiaries
Financial data as of 6/30/08
American Life Variable Annuity AIG Annuity American General National Union Fire American Home American
($ in millions) Insurance Co. Life Insurance Co Life SunAmerica Life Insurance Co. Assurance International Life
Type of Business L&H Insurance L&H Insurance L&H Insurance L&H Insurance L&H Insurance P&C P&C L&H Insurance
Home State DE TX TX TX AZ PA NY NY
Ratings*
S&P AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08) AA+ WN (9/12/08)
Moodys Aa2 OS (5/28/08) Aa2 ON (8/7/08) Aa2 ON (8/7/08) Aa2 ON (8/7/08) Aa2 ON (8/7/08) Aa3 OS (5/28/08) Aa3 OS (5/28/08) Aa2 ON (8/7/08)
Fitch AA+ WN (8/22/08) AA+ WN (8/22/08) AA+ WN (8/22/08) AA+ WN (8/22/08) AA+ WN (8/22/08) na AA+ WN (8/22/08) AA+ WN (8/22/08)
Balance Sheet Highlights

Total Assets $105,606 $62,880 $53,078 $39,489 $38,003 $34,190 $27,867 $7,005
% of Consolidated Assets ($1.0 trillion) 10.1% 6.0% 5.1% 3.8% 3.6% 3.3% 2.7% 0.7%
Bonds $53,832 $24,287 $40,098 $23,880 $16,878 $14,171 $15,614 $5,640
Separate Accounts $37,122 $26,649 $373 $2,685 $215 na na $120
Total Capital $7,113 $2,911 $3,224 $5,513 $4,748 $12,195 $6,527 $440
Asset Valuation Reserve $363 $471 $1,012 $289 $1,047 na na $715
Unrealized Gains (Loss) ($706) ($111) $23 ($906) ($497) $72 na $2
Total Adjusted Capital (YE 2007) na $3,632 $4,878 $6,839 $5,976 $11,373 $7,041 $662
Authorized Control RBC Ratio (YE2007) na $568 $666 $1,063 $836 $2,818 $1,602 $92
RBC Ratio (YE 2007) na 639% 732% 644% 714% 404% 440% 715%
Income Statement Highlights

Net Income (excl. Capital Gains) $580 $249 $191 $151 $300 $679 $491 $33
Realized Capital Gains (Loss) ($381) ($1,551) ($2,325) ($1,260) ($1,085) $206 $1,185 ($290)
Dividends to Parent**
2008 (first six months) $0 $0 $0 $0 $0 $1,109 $268 $50
2007 $1,033 $700 $400 $551 $700 $1,120 $615 $100
2006 $200 $400 $150 $208 $349 $0 $0 $62
2005 $50 $400 $0 $441 $480 $98 $32 $50
2004 $50 $360 $0 $301 $26 $207 $63 $0
* WN: Watch Negative, OS: Outlook Stable, ON: Outlook Negative

** In 2007, AIG parent collected $4.9 billion in dividends. In the first half of 2008, AIG parent collected $1.4 billion in dividends. (Source: 10K)
BOG-- FOIA 10-251 --000409
(b) (5)
BOG-- FOIA 10-251 --000410

From: Tim P Clark
Subject: Re: Fw: LFI Exposures to AIG (9/13/08 AM Update)
Date: 09/14/2008 04:45 PM
(b) (5)
▼ Coryann Stefansson/BOARD/FRS
Coryann Stefansson/BOARD/FRS
To BSR LIG
cc
09/14/2008 04:40 PM
Subject Fw: LFI Exposures to AIG (9/13/08 AM Update)
Associate Director
Board of Governors
Office 202-452-5287
Cell Number 202- 294- 9829

Kim.Jensik@frb.gov
To BSR LFIC
cc
09/13/2008 01:00 PM
RESTRICTED FR
---
Below and attached please find the most current version of LFI credit exposures to AIG. This data represents the best
information available, culled from the sources at hand (i.e. not reaching out directly to the firms). Using flow-basis traffic,
we will work to update this information over the course of today and going forward.
Duplicate
BOG-- FOIA 10-251 --000411

From: Donald L Kohn
To: Timothy Geithner
Subject: Re: Fw: Pros and Cons on AIG lending
Date: 09/14/2008 05:00 PM
I would add (b) (5)
▼ Timothy Geithner/NY/FRS@FRS
Timothy
Geithner/NY/FRS@FRS
To (b) (6) Donald L
Sent by: Michael
Kohn/BOARD/FRS@BOARD
Held/NY/FRS@FRS
cc
Subject Fw: Pros and Cons on AIG lending
09/14/2008 04:41 PM
----- Forwarded by Michael Held/NY/FRS on 09/14/2008 04:40 PM -----
Alejandro
LaTorre/NY/FRS
LaTorre/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS, Elise Liebers/NY/FRS@FRS,
09/14/2008 03:49 PM Hayley Boesky/NY/FRS@FRS, Jim
William Walsh/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, Timothy Geithner/NY/FRS@FRS,
Michael Silva/NY/FRS@FRS, Meg
McConnell/NY/FRS@FRS, William Dudley/NY/FRS@FRS,
William Rutledge/NY/FRS@FRS, Terrence
Checki/NY/FRS@FRS, Susan Stiehm/NY/FRS@FRS,
Arthur Angulo/NY/FRS@FRS
cc Tanshel Pointer/NY/FRS@FRS
Subject Pros and Cons on AIG lending
Duplicate
BOG-- FOIA 10-251 --000412

To: Adam Ashcraft; Alejandro LaTorre; Brian Peters; Christine Cumming; Christopher Calabia; Elise Liebers; Hayley
Boesky; Jim Mahoney; Patricia Mosser; Paul Whynott; Richard Charlton; Tobias Adrian; William Walsh; Azish
Filabi; Terrence Checki; Brian F Madigan; Scott Alvarez; Deborah P Bailey; Jon D Greenlee
Subject: AIG update
Date: 09/14/2008 06:36 PM
From AIG CFO and Vice Chm:
The capital injection plan that AIG and NYSID outlined earlier for us is now in
serious doubt, due to withdrawal of one of the private equity investors, (b) (4)
That plan combined private equity investment with asset sales, upstreaming of
assets from P&C insurance subs to the parent, and a "wrap" of their GICs by
(b) (4) to prevent the need to post collateral.
In the new plan, (b) (4) would provide equity jointly with (b) (4) We
have very few details, but on the surface, it appears to be closer to a takeover
offer. Effectively AIG would increase their shares outstanding by more than 100%,
allowing (b) (4) to control the firm. The offer is also contingent upon
AIG getting access to Fed lending facilities. AIG believes the offer is not realistic --
both from an equity delusion standpoint and based on their conversations with us.
They will keep us updated on future developments.
BOG-- FOIA 10-251 --000413

From: Jon.D.Greenlee@frb.gov
To: William Nelson
Subject: Fw: My proposed insert to Monetary Affairs partial memo draft
Date: 09/14/2008 06:40 PM
Attachments: AIG memo v2.mg.bfm - DF edits 9-14-08.doc
Bill,
Here is something that you may find helpful for the memo. Given the email
Trish just sent we may need to get it ready again.
Jon
--------------------------

From: Diane Fraser
Sent: 09/14/2008 03:02 PM EDT
To: Jon Greenlee
Cc: Diane Fraser
. . .plus some cosmetic nits I edited.
Jon, would you please let me know of your comments.(See attached file: AIG
memo v2.mg.bfm - DF edits 9-14-08.doc)
Thanks,
Diane
Jon D
Greenlee/BOARD/FR
S To
Diane Fraser/BOARD/FRS@BOARD
09/14/2008 07:33 cc
AM
Subject
Fw: Partial memo draft
Duplicate
BOG-- FOIA 10-251 --000414

Duplicate
- AIG memo v2.mg.bfm - DF edits 9-14-08.doc
BOG-- FOIA 10-251 --000415

(b) (5)
BOG-- FOIA 10-251 --000416

(b) (5)
BOG-- FOIA 10-251 --000417

(b) (5)
BOG-- FOIA 10-251 --000418

(b) (5)
BOG-- FOIA 10-251 --000419

(b) (5)
BOG-- FOIA 10-251 --000420

(b) (5)
BOG-- FOIA 10-251 --000421

(b) (5)
BOG-- FOIA 10-251 --000422

(b) (5)
BOG-- FOIA 10-251 --000423

To: Diane Fraser; Adrienne Haden
Date: 09/14/2008 06:41 PM
Fyi
--------------------------

Sent: 09/14/2008 06:40 PM EDT
To: Adam Ashcraft; Alejandro LaTorre; Brian Peters; Christine Cumming;
Christopher Calabia; Elise Liebers; Hayley Boesky; Jim Mahoney; Patricia
Mosser; Paul Whynott; Richard Charlton; Tobias Adrian; William Walsh; Azish
Filabi; Terrence Checki; Brian Madigan; Scott Alvarez; Deborah Bailey; Jon
Greenlee
Subject: AIG update
Duplicate
BOG-- FOIA 10-251 --000424

To: James A Clouse; William B English; William R Nelson; Roberto Perli; Michael S Gibson; Patrick M Parkinson
Cc: Brian F Madigan
Date: 09/14/2008 06:46 PM
Patricia
Mosser/NY/FRS@FRS
LaTorre/NY/FRS@FRS, Brian Peters/NY/FRS@FRS,
Christine Cumming/NY/FRS@FRS, Christopher
09/14/2008 06:36 PM Calabia/NY/FRS@FRS, Elise Liebers/NY/FRS@FRS,
Hayley Boesky/NY/FRS@FRS, Jim
William Walsh/NY/FRS@FRS, Azish
Filabi/NY/FRS@FRS, Terrence Checki/NY/FRS, Brian F
Madigan/BOARD/FRS@BOARD, Scott
Bailey/BOARD/FRS@BOARD, Jon D
cc
Subject AIG update

Duplicate
BOG-- FOIA 10-251 --000425

To: (b) (6) ; Donald L Kohn; Randall S Kroszner; Elizabeth A Duke; Kevin Warsh; Brian F Madigan; Scott
Alvarez
Cc: Roger Cole
Date: 09/14/2008 06:47 PM
Importance: High
Please see the update from Trish. The capital injection by (b) (4) seems in
jeopardy.
---- Forwarded by Deborah P Bailey/BOARD/FRS on 09/14/2008 06:42 PM -----
Patricia
Mosser/NY/FRS@FRS
cc
Subject AIG update

Duplicate
BOG-- FOIA 10-251 --000426

To: Norah Barger; Coryann Stefansson
Date: 09/14/2008 06:59 PM
Patricia
Mosser/NY/FRS@FRS
cc
Subject AIG update

Duplicate
BOG-- FOIA 10-251 --000427

To: Brian F Madigan
Subject: AIG
Date: 09/14/2008 07:15 PM
Brian-
If there is anything to be done on AIG tonight, give me a call or e-mail.
--Bill E. (b) (6)
BOG-- FOIA 10-251 --000428

To: Patricia Mosser
Subject: Re: Fw: AIG update
Date: 09/14/2008 07:31 PM
that sucks. I thought we'd dodged this one.
Office: 202-452-3579
Mobile: 703-340-4542
Brian F
Madigan/BOARD/FRS
Nelson/BOARD/FRS@BOARD, Roberto
09/14/2008 06:46 PM Perli/BOARD/FRS@BOARD, Michael S
Gibson/BOARD/FRS@BOARD, Patrick M
Parkinson/BOARD/FRS@BOARD
Subject Fw: AIG update
Patricia
Mosser/NY/FRS@FRS
cc
Subject AIG update

Duplicate

BOG-- FOIA 10-251 --000429

To: Jon.D.Greenlee@frb.gov
Subject: Re: Fw: My proposed insert to Monetary Affairs partial memo draft
Date: 09/14/2008 07:32 PM
thanks Jon.
Office: 202-452-3579
Mobile: 703-340-4542
▼ Jon.D.Greenlee@frb.gov
To "William Nelson" <William.R.Nelson@frb.gov>
cc
09/14/2008 06:40 PM
Subject Fw: My proposed insert to Monetary Affairs partial memo draft
Bill,
Here is something that you may find helpful for the memo. Given the
email
Trish just sent we may need to get it ready again.
Jon
--------------------------
Duplicate
BOG-- FOIA 10-251 --000430

To: Sabeth I Siddique; James Embersit
Date: 09/14/2008 07:36 PM
Jon Greenlee
Associate Director
Phone (202) 452-2962
Patricia
Mosser/NY/FRS@FRS
cc
Subject AIG update

Duplicate
BOG-- FOIA 10-251 --000431

From: Adam Ashcraft
To: Patricia Mosser; Alejandro LaTorre; Brian Peters; Christine Cumming; Christopher Calabia; Elise Liebers; Hayley
Boesky; Jim Mahoney; Paul Whynott; Richard Charlton; Tobias Adrian; William Walsh; Azish Filabi; Terrence
Checki; Brian F Madigan; Scott Alvarez; Deborah P Bailey; Jon D Greenlee
Subject: Re: AIG update
Date: 09/14/2008 07:47 PM
(b) (5)
--------------------------
▼ Patricia Mosser

Sent: 09/14/2008 06:40 PM EDT
To: Adam Ashcraft; Alejandro LaTorre; Brian Peters; Christine Cumming;
Christopher Calabia; Elise Liebers; Hayley Boesky; Jim Mahoney; Patricia
Mosser; Paul Whynott; Richard Charlton; Tobias Adrian; William Walsh; Azish
Filabi; Terrence Checki; Brian Madigan; Scott Alvarez; Deborah Bailey; Jon
Greenlee
Subject: AIG update
Duplicate
BOG-- FOIA 10-251 --000432

To: Sabeth Siddique; James Embersit; Adrienne Haden; Nina.Nichols@frb.gov
Subject: Fw: State Street and RBS Update
Date: 09/14/2008 08:19 PM
Attachments: GPCAN009 EXCHANGE 09112008-113640.PDF
--------------------------

From: Chris Haley
Sent: 09/14/2008 08:19 PM EDT
To: NY Bank Sup - CPC Updates
Cc: Eric Rosengren; Jim Nolan; Maureen Savage; Jackie Palladino; Eileen
Leighton; Rhonda Kelley; Scott Strah; LauraDuhamel Rogers; Maureen Tighe;
Jennifer Hynes; Jeffrey Slone; Phil Patch; Gerard Donovan; Abdul Hasnudeen;
Johan Seo; Paul Nadeau; Beverly Broderick; Peter McAvoy; Jamie Marsh; Paul
Webster; Tony Bardascino; Timothy Daniels; Erin Long; Ken Fortier;
Genevievette Walker; Kwayne Jennings
Subject: State Street and RBS Update
State Street Update
Highlights of discussion with Stefan Gavell:
Not Responsive
Next names they are worried about are Merrill and AIG. (b)(4) & (b)(8)
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000433

Not Responsive
(See attached file: GPCAN009_EXCHANGE_09112008-113640.PDF)
That's all for now......Chris - GPCAN009 EXCHANGE 09112008-

113640.PDF
BOG-- FOIA 10-251 --000434

Not Responsive
BOG-- FOIA 10-251 --000435

Not Responsive
BOG-- FOIA 10-251 --000436

Not Responsive
BOG-- FOIA 10-251 --000437

To: Gustavo A Suarez; JNellie Liang
Subject: AIG commercial paper outstandings
Date: 09/14/2008 09:19 PM
Nellie/Gustavo;
Any chance we can the underwriter, outstandings and rates for AIGs CP and ABCP
programs; again very much in the spirit of what you've produced in the past first
thing in the am tomorrow. Thanks!
Regards,
Alex
BOG-- FOIA 10-251 --000438

From: JNellie Liang
To: Alejandro LaTorre
Cc: Gustavo A Suarez; JNellie Liang; Daniel M Covitz
Subject: Re: AIG commercial paper outstandings
Date: 09/14/2008 09:25 PM
Yes, we'll try our best.
▼ Alejandro LaTorre/NY/FRS@FRS
Alejandro
LaTorre/NY/FRS@FRS
To Gustavo A Suarez/BOARD/FRS@BOARD, JNellie
Liang/BOARD/FRS@BOARD
cc
09/14/2008 09:19 PM
Subject
AIG commercial paper outstandings
Duplicate
BOG-- FOIA 10-251 --000439

To: JNellie Liang
Cc: Daniel M Covitz; Gustavo A Suarez; JNellie Liang
Date: 09/14/2008 09:26 PM
Thank you.
▼ JNellie Liang/BOARD/FRS@BOARD
JNellie
Liang/BOARD/FRS@BOARD
To Alejandro LaTorre/NY/FRS@FRS
cc Gustavo A Suarez/BOARD/FRS@BOARD, JNellie
Liang/BOARD/FRS@BOARD, Daniel M
09/14/2008 09:28 PM Covitz/BOARD/FRS@BOARD
Subject
Re: AIG commercial paper outstandings
Duplicate
BOG-- FOIA 10-251 --000440

From: Diane.Fraser@frb.gov
To: Christopher.Calabia@ny.frb.org
Cc: Elise.Liebers@ny.frb.org; Erika.Gottfried@ny.frb.org; Min.Kim@ny.frb.org; Danielle.Vicente@ny.frb.org;
Subject: Notes from 9-14-08 conf. call with NYSID Superintendent Eric Dinallo re: AIG
Date: 09/14/2008 10:06 PM
Attachments: Notes from conf. call with NYSID Sup. Dinallo re AIG (9-14-08).doc
Hi Chris,
Attached are the notes I assembled for Board senior management regarding the
discussions this morning with New York State Insurance Department regulators
concerning AIG. Many thanks to the folks working with you on the AIG assignment
for their input to and review of these notes.
Please distribute to FRBNY folks as you see fit.
Thank you,
Diane
- Notes from conf. call with NYSID Sup. Dinallo re AIG (9-14-08).doc
BOG-- FOIA 10-251 --000441

RESTRICTED FR
Conference Call with Eric Dinallo, Superintendent

New York State Insurance Department (NYSID)
Regarding the Financial Condition of American International Group, Inc. (AIG)
September 14, 2008
(b)(4), (b)(5), & (b)(8)
1
BOG-- FOIA 10-251 --000442
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
2
BOG-- FOIA 10-251 --000443
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
3
BOG-- FOIA 10-251 --000444
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
4
BOG-- FOIA 10-251 --000445
To: Jon.D.Greenlee@frb.gov
Cc: Adrienne.Haden@frb.gov; Diane.Fraser@frb.gov
Subject: Notes from 9/14/08 conf. call w/ New York State Insurance Dept. Superintendent Dinallo re: AIG
Date: 09/14/2008 10:09 PM
Jon,
Per your request.
Please distribute to others who may find these notes useful.
Diane
- Notes from conf. call with NYSID Sup. Dinallo re AIG (9-14-08).doc
Attachment is a duplicate
BOG-- FOIA 10-251 --000446

From: Donald L Kohn
To: (b) (6) ; Timothy Geithner
Cc: brian.f.madigan@frb.gov; Scott Alvarez; Deborah P Bailey
Subject: AIG
Date: 09/14/2008 10:14 PM
Call from Frankel and Willumsted tonight renewing request for FR credit. Main
points: Expect downgrade tomorrow which will accelerate demand for collateral.
Probably enough liquidity to get to Weds., but not much further. Need 50 b
liquidity. Have 8, can get 15 more out of insurance subs, but would only be
approved if part of plan to get back to health. Board rejected (b) (4) offer, which
he described as, in effect, 10b of equity in exchange for 60 percent of the companya
nd conditioned on access to Fed window. (Also would fire board and upper
management.) Board voted to authorize sale of subs if necessary to repay FR credit
(b) (5) Two asset sales in negotiation for
combined 11-13 b, but neither are sure and both would require regualtory approvals
and hence take months. (b) (4) talking a bout 10b equity, but very vague.
portrayed access to FR credit as necessary to enable equity raise. Notjhing to
announce tomorrow morning.
(b) (5)
I was completley
noncommital--didn't comment at all on request. Simply said I would relay
conversation to colleagues. Willing to talk tonight, Tim, if you think it's necessary.
Otherwise we should consult tomorrow morning. Don
BOG-- FOIA 10-251 --000447

Subject: Fw: draft AIG memo
Date: 09/14/2008 10:16 PM
FYI - According to Bill this will not be sent to the Board.
Mike
William R
Nelson/BOARD/FRS
To William B English/BOARD/FRS@BOARD, Roberto
Perli/BOARD/FRS@BOARD, Michael S
09/14/2008 03:55 PM Greenlee/BOARD/FRS@BOARD
cc Brian F Madigan/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD
Subject draft AIG memo
Here is the current draft of the AIG memo. No need for additional comments at this
time.
Bill
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000448

(b) (5)
BOG-- FOIA 10-251 --000449

(b) (5)
BOG-- FOIA 10-251 --000450

(b) (5)
BOG-- FOIA 10-251 --000451

(b) (5)
BOG-- FOIA 10-251 --000452

(b) (5)
BOG-- FOIA 10-251 --000453

(b) (5)
BOG-- FOIA 10-251 --000454

(b) (5)
BOG-- FOIA 10-251 --000455

(b) (5)
BOG-- FOIA 10-251 --000456

(b) (5)
BOG-- FOIA 10-251 --000457

(b) (5)
BOG-- FOIA 10-251 --000458

(b) (5)
BOG-- FOIA 10-251 --000459

(b) (5)
BOG-- FOIA 10-251 --000460

To: Sandy Krieger
Subject: AIG
Date: 09/14/2008 10:31 PM
Hi Sandy,
(b) (5)
Bill
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000461

To: Sandy Krieger
Subject: Re: AIG
Date: 09/14/2008 10:41 PM
(b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
▼ Sandy Krieger/NY/FRS@FRS
Sandy
Krieger/NY/FRS@FRS
cc
09/14/2008 10:39 PM Subject Re: AIG
Thanks. I tried to choose my words carefully, " don't know of any

decisions to lend."
-----------------
BOG-- FOIA 10-251 --000462

From: Craig F Marchbanks
To: James Embersit; David K Lynch; Ricardo Crumble; Mary L Arnett
Subject: Fw: SGNY update
Date: 09/15/2008 12:18 AM
Regards,
Craig F. Marchbanks
Federal Reserve Board of Governors
Banking Supervision & Regulation
Market & Liquidity Risk Section
(202) 452-3442 - Office
(202) 446-7051 - Cell
----- Forwarded by Craig F Marchbanks/BOARD/FRS on 09/15/2008 12:17 AM -----
Dennis
Ryan/NY/FRS@FRS
To Alexa Philo/NY/FRS@FRS, Amy White/NY/FRS@FRS,
Anthony Cirillo/NY/FRS@FRS, Arthur
Angulo/NY/FRS@FRS, Ashish Bhatia/NY/FRS@FRS,
09/15/2008 12:05 AM Barbara Yelcich/NY/FRS@FRS, Bard
Stermasi/NY/FRS@FRS, Brandon Hall/NY/FRS@FRS,
Brian Peters/NY/FRS@FRS, Bridget
Habib/NY/FRS@FRS, Caren Cox/NY/FRS@FRS, Caroline
Frawley/NY/FRS@FRS, Catherine A
Tilford/BOARD/FRS@BOARD, Catherine
Voigts/NY/FRS@FRS, Chris Haley/BOS/FRS@FRS, Chris
McCurdy/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS, Claudia Franco/NY/FRS@FRS,
Corbin Long/NY/FRS@FRS, Coryann
Stefansson/BOARD/FRS@BOARD, Craig F
Marchbanks/BOARD/FRS@BOARD, Daniel
Muccia/NY/FRS@FRS, Debra Capurso/NY/FRS@FRS,
Denise Goodstein/NY/FRS@FRS, Dennis
Ryan/NY/FRS@FRS, Dexter Williams/NY/FRS@FRS,
Diane Rose/RICH/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS,
Genevievette.E.Walker@frb.gov, Gretchen
Cappiello/NY/FRS@FRS, H Clay Saylor/NY/FRS@FRS,
Helen Mucciolo/NY/FRS@FRS, Homer
Hill/NY/FRS@FRS, Jack Jennings/BOARD/FRS@BOARD,
James Hodgetts/NY/FRS@FRS, James
Wall/NY/FRS@FRS, Jan Voigts/NY/FRS@FRS, Jane
Majeski/NY/FRS@FRS, Jane Wakefield/NY/FRS@FRS,
Jeanmarie Davis/NY/FRS@FRS, Jennifer
Burns/RICH/FRS@FRS, Jim Mahoney/NY/FRS@FRS,
John Beebe/RICH/FRS@FRS, John
Heinze/NY/FRS@FRS, John Leiby/NY/FRS@FRS, John
Reynolds/NY/FRS@FRS, John Ricketti/NY/FRS@FRS,
John Ruocco/NY/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD, Jonathan
Polk/NY/FRS@FRS, Joseph Galati/NY/FRS@FRS, Judith
J Gruttman/NY/FRS@FRS, Jyoti
Kohli/BOARD/FRS@BOARD, Kara
Sulmasy/NY/FRS@FRS, Karen Kahrs/NY/FRS@FRS,
Katheryn Van der Celen/NY/FRS@FRS, Kathryn
Chen/NY/FRS@FRS, Kevin Clarke/NY/FRS@FRS, Kevin
Lee/NY/FRS@FRS, Kirsten Harlow/NY/FRS@FRS, Kyle
Grieser/NY/FRS@FRS, Lance Auer/NY/FRS@FRS, Larry
Bonnemere/NY/FRS@FRS, Laura A
Macedo/BOARD/FRS@BOARD, Lily
Tham/NY/FRS@FRS, Lisa A White/RICH/FRS@FRS,
Lisa Joniaux/NY/FRS@FRS, Lucinda M
Brickler/NY/FRS@FRS, Lydia Tshulos/NY/FRS@FRS,
Marilyn Arbuthnott/NY/FRS@FRS, Mark
Scapp/NY/FRS@FRS, Michael Johnson/SF/FRS@FRS,
BOG-- FOIA 10-251 --000463

Pamela S Powell/BOARD/FRS@BOARD, Pat
Soriano/BOARD/FRS@BOARD, Patrick
Roche/NY/FRS@FRS, Philip Aquilino/SF/FRS@FRS,
Ralph Santasiero/NY/FRS@FRS, Richard
Naylor/BOARD/FRS@BOARD, Richard
Roberts/NY/FRS@FRS, Richard
Westerkamp/RICH/FRS@FRS, Robard
Williams/NY/FRS@FRS, Robert Gutierrez/NY/FRS@FRS,
Roger Graham/NY/FRS@FRS, Ronald
Stroz/NY/FRS@FRS, Sandy Krieger/NY/FRS@FRS, Sara
Mahmoud/NY/FRS@FRS, Sarah
Dahlgren/NY/FRS@FRS, Stacy.L.Coleman@rich.frb.org,
Stanley Poszywak/RICH/FRS@FRS, Stephanie
Chaly/NY/FRS@FRS, Steven J Manzari/NY/FRS@FRS,
Steven Mirsky/NY/FRS@FRS, Susan G
Ballinger/NY/FRS@FRS, Terry
Muckleroy/BOARD/FRS@BOARD, Theodore
Lubke/NY/FRS@FRS, Theresa Barry/BOS/FRS@FRS,
Tim.P.Clark@frb.gov, Todd
Waszkelewicz/NY/FRS@FRS, Wendy Ng/NY/FRS@FRS,
William BRODOWS/NY/FRS@FRS, William
Hallacy/NY/FRS@FRS, Wing Oon/NY/FRS@FRS, Zahra
El-Mekkawy/NY/FRS@FRS
cc Adrian Lawrence/NY/FRS@FRS, Dmitry J
Gershik/NY/FRS@FRS, Renuka
Vijayanathan/NY/FRS@FRS, Hasan Latif/NY/FRS@FRS
Subject SGNY update
Restricted FR
SG - Diony Lebot (NY - CEO), Mark Kaplan (NY - CAO) , Liz Hogan (NY - Co head of
Fixed Income, Currency and Commodities), Francois Barthelemy (NY - head of Equity
trading), Jerome Jacques (NY - Co head of Fixed Income, Currency and
Commodities), Jack Baldwin (NY - Chief Risk Officer).
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000464

Not Responsive
(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000465

To: Brian F Madigan
Subject: Fw: My proposed insert to Monetary Affairs partial memo draft
Date: 09/15/2008 06:58 AM
this might be worth adding. (b) (5)

see text in red below.
Office: 202-452-3579
Mobile: 703-340-4542
To "William Nelson" <William.R.Nelson@frb.gov>
cc
09/14/2008 06:40 PM
Subject Fw: My proposed insert to Monetary Affairs partial
memo draft
Duplicate

Jon D
Greenlee/BOARD/FR
S To
Diane Fraser/BOARD/FRS@BOARD
09/14/2008 07:33 cc
AM
Subject
Fw: Partial memo draft

BOG-- FOIA 10-251 --000466

Duplicate

Jon D
Greenlee/BOARD/FR
S To
Brian F Madigan/BOARD/FRS@BOARD
09/14/2008 07:32 cc
AM James A Clouse/BOARD/FRS@Board,
Michael S Gibson/BOARD/FRS@Board,
Roberto Perli/BOARD/FRS@Board,
William B English/BOARD/FRS@Board
Subject
Re: Partial memo draft(Document
link: Jon D Greenlee)

(b) (5)
We can provide some language on this later today.

Thanks
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
Duplicate
BOG-- FOIA 10-251 --000467

(b) (5)
BOG-- FOIA 10-251 --000468

(b) (5)
BOG-- FOIA 10-251 --000469

(b) (5)
BOG-- FOIA 10-251 --000470

(b) (5)
BOG-- FOIA 10-251 --000471

(b) (5)
BOG-- FOIA 10-251 --000472

(b) (5)
BOG-- FOIA 10-251 --000473

(b) (5)
BOG-- FOIA 10-251 --000474

(b) (5)
BOG-- FOIA 10-251 --000475

To: Brian F Madigan
Subject: Re: Fw: Liquidity Plans from AIG - Call with Insurance Regulators @ 10:30 today
Date: 09/15/2008 07:31 AM
Office: 202-452-3579
Mobile: 703-340-4542
Brian F
Madigan/BOARD/FRS
To Scott Alvarez/BOARD/FRS@BOARD, James A
Clouse/BOARD/FRS@BOARD, William B
09/14/2008 03:26 PM Nelson/BOARD/FRS@BOARD, Roberto
Gibson/BOARD/FRS@BOARD, Deborah P
cc
Subject Fw: Liquidity Plans from AIG - Call with Insurance
FYI.
Alejandro
LaTorre/NY/FRS@FRS
cc
09/14/2008 03:24 PM Subject Fw: Liquidity Plans from AIG - Call with Insurance
Duplicate
Duplicate
BOG-- FOIA 10-251 --000476

To: Brian F Madigan
Subject: aig's value is down 44 percent this morning ...
Date: 09/15/2008 08:03 AM
Binder1.pdf
.... on the silence about a liquidity deal.
here is the document and the appendix.
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000477

(b) (5)
BOG-- FOIA 10-251 --000478

(b) (5)
BOG-- FOIA 10-251 --000479

(b) (5)
BOG-- FOIA 10-251 --000480

(b) (5)
BOG-- FOIA 10-251 --000481

(b) (5)
BOG-- FOIA 10-251 --000482

(b) (5)
BOG-- FOIA 10-251 --000483

(b) (5)
BOG-- FOIA 10-251 --000484

(b) (5)
BOG-- FOIA 10-251 --000485

(b) (5)
BOG-- FOIA 10-251 --000486

(b) (5)
BOG-- FOIA 10-251 --000487

(b) (5)
BOG-- FOIA 10-251 --000488

(b) (5)
BOG-- FOIA 10-251 --000489



2008 2007
Assets:
$393,170) $ 393,316 $ 397,372
Equity securities:
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
2008 – $36; 2007 – $233) 33,311 31,234
Cash 2,229 2,284
$5,446) 5,692 5,518
Goodwill 10,661 9,414
Total assets $1,049,876 $1,048,361
1 BOG-- FOIA 10-251 --000490


2008 2007
Liabilities:
$8,338) 9,659 8,331
value: 2008 – $240) 6,165 4,903
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
2 BOG-- FOIA 10-251 --000491


2008 2007 2008 2007
Revenues:
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000492

Segment Results
Statements.)
Total revenues(a):
Other 208 263 (21) 80 394 (80)
Total $ 19,933 $31,150 (36)% $ 33,964 $61,795 (45)%
Other (715) (460) — (1,483) (930) —
Total $ (8,756) $ 6,328 — $(20,020) $12,500 —%
To: Roberto Perli
Subject: aig
Date: 09/15/2008 08:28 AM
what were they rated by the three rating agencies on Friday? (long term senior
unsecured). thanks.
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000494

From: Kevin Warsh
To: Michelle A Smith
Subject: Re: Liesman wonders if he can say
Date: 09/15/2008 08:33 AM
(b) (5)
▼ Michelle A Smith/BOARD/FRS
Michelle A
Smith/BOARD/FRS
To Kevin Warsh/BOARD/FRS@BOARD
cc
09/14/2008 11:31 PM Subject Liesman wonders if he can say
That the fed thinks aig shd pursue all other options before coming to
us.
Is that too explosive? Seems reasonable but maybe not reasonable for
us to say or for steve to hype.
BOG-- FOIA 10-251 --000495

From: JNellie.Liang@frb.gov
Subject: Re: CP
Date: 09/15/2008 08:47 AM
yes, and we are sending something up to NY on AIG this morning.
Patrick.M.Parkins
on@frb.gov
To
09/15/2008 08:39 "Nellie Liang"
AM <JNellie.Liang@frb.gov>
cc
Subject
CP
Is Gustavo monitoring the roll rate at major nonbank financial issuers? Pat
BOG-- FOIA 10-251 --000496

To: Brian F Madigan
Subject: aig slightly revised
Date: 09/15/2008 08:47 AM
Binder1.pdf
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000497

(b) (5)
BOG-- FOIA 10-251 --000498

(b) (5)
BOG-- FOIA 10-251 --000499

(b) (5)
BOG-- FOIA 10-251 --000500

(b) (5)
BOG-- FOIA 10-251 --000501

(b) (5)
BOG-- FOIA 10-251 --000502

(b) (5)
BOG-- FOIA 10-251 --000503

(b) (5)
BOG-- FOIA 10-251 --000504

(b) (5)
BOG-- FOIA 10-251 --000505

(b) (5)
BOG-- FOIA 10-251 --000506

(b) (5)
BOG-- FOIA 10-251 --000507

(b) (5)
BOG-- FOIA 10-251 --000508

(b) (5)
BOG-- FOIA 10-251 --000509



2008 2007
Assets:
$393,170) $ 393,316 $ 397,372
Equity securities:
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
2008 – $36; 2007 – $233) 33,311 31,234
Cash 2,229 2,284
$5,446) 5,692 5,518
Goodwill 10,661 9,414
Total assets $1,049,876 $1,048,361
1 BOG-- FOIA 10-251 --000510


2008 2007
Liabilities:
$8,338) 9,659 8,331
value: 2008 – $240) 6,165 4,903
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
2 BOG-- FOIA 10-251 --000511


2008 2007 2008 2007
Revenues:
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000512

Segment Results
Statements.)
Total revenues(a):
Other 208 263 (21) 80 394 (80)
Total $ 19,933 $31,150 (36)% $ 33,964 $61,795 (45)%
Other (715) (460) — (1,483) (930) —
Total $ (8,756) $ 6,328 — $(20,020) $12,500 —%
From: Diane Fraser
To: Elise Liebers; Christopher Calabia
Cc: Diane.Fraser@frb.gov
Bcc: William B English
Subject: News re: AIG, facing liquidity crunch, seeking loan from Fed
Date: 09/15/2008 08:50 AM
Business Insurance
AIG, facing liquidity crunch, seeks loan from Fed
Sept. 14, 2008
NEW YORK—Insurer American International Group Inc., working to stave off rating
downgrades and shore up the capital of its holding company, has made an unprecedented
approach to the Federal Reserve seeking short-term financing, media reports said.
Chief Executive Robert Willumstad reached out to the Fed late on Sunday, according to the
Wall Street Journal and business news channel CNBC. The New York Times reported
Sunday evening that AIG was seeking $40 billion in aid to avoid a downgrade from credit
rating agencies.
The Fed normally oversees monetary policy and supervision of banks, but CNBC said AIG
was seeking the funds as a temporary measure and planned to repay the Fed with the
proceeds from asset sales.
AIG officials did not immediately respond to requests for comment.
The company, until recently the world's biggest insurer by market capitalization, has been
attempting to hammer out an emergency strategic plan after its shares fell nearly 50% last
week on fears it faced a liquidity crisis.
AIG has been negotiating with various parties including officials from the New York
Insurance Department and private equity firms as it seeks ways to free up capital, raise new
capital and protect policyholders.
Regulators including New York Insurance Superintendent Eric Dinallo have been holed up
at AIG's New York offices over the past two days trying to hammer out a plan.
BOG-- FOIA 10-251 --000514

"We are working to craft a solution to protect the company and policyholders," said a
person from the New York Insurance Department, who asked not to be named.
Former AIG CEO Maurice "Hank" Greenberg, who ran the company for nearly four
decades, was not involved in any of the discussions, said his spokesman, Glen Rochkind.
"He repeatedly offered to assist in anyway he could," added Mr. Rochkind.
AIG, hit by $18 billion in losses over the past three quarters from guarantees it wrote on
mortgage derivatives, has had to act quickly after Standard & Poor's said on Friday it may
downgrade AIG's ratings.
Ratings downgrades could force AIG to post up to $14.5 billion more in collateral,
according to a regulatory filing last month.
Downgrades could also be detrimental to AIG's insurance business, since some policies
carry clauses that nullify a contract in the event of downgrades below a certain level.
Over the weekend, the insurer has been working on a three-part plan involving asset sales,
shifting regulated capital from the insurance operations to the holding company, and
working with private equity investors, said a person familiar with the negotiations.
Parties in capital-raising talks with AIG included buyout firms Kohlberg Kravis Roberts &
Co (KKR.UL) and J.C. Flowers & Co, another person familiar with the talks said.
An AIG spokesman earlier confirmed the company was evaluating a wide range of options,
including asset sales.
Media reports have said that one of the companies on the block was AIG's highly profitable
aircraft leasing arm, but the spokesman declined to confirm this was the case.
In late June, AIG said the unit, International Lease Finance Corp, would remain part of
AIG.
AIG was founded in China 89 years ago. In the years since, largely under Mr. Greenberg's
watch, it grew into one of the world's largest insurers, spanning 130 countries and territories
and serving 74 million customers.
Mr. Greenberg stepped down in 2005, in the midst of an accounting scandal. His successor,
BOG-- FOIA 10-251 --000515

Martin Sullivan, was replaced by Mr. Willumstad in June after investors grew disgruntled
over its three quarters of losses.
Greenberg owns or controls about 12% of AIG's stock, making him the largest shareholder.
Copyright 2008 Reuters Limited. Click for restrictions.
BOG-- FOIA 10-251 --000516

From: Roberto Perli
Subject: Re: aig
Date: 09/15/2008 08:52 AM
Aa3 and AA-, I don't know fitch
William R
Nelson/BOARD/FRS
To Roberto Perli/BOARD/FRS@BOARD
cc
09/15/2008 08:28 AM Subject aig
what were they rated by the three rating agencies on Friday? (long
term senior unsecured). thanks.
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000517

From: Donald L Kohn
To: (b) (6) Timothy Geithner
Cc: brian.f.madigan@frb.gov; Scott Alvarez; Patrick M Parkinson
Subject: Fw: Thank you
Date: 09/15/2008 08:57 AM
(b) (5)
----- Forwarded by Donald L Kohn/BOARD/FRS on 09/15/2008 08:54 AM -----
Brian F
Madigan/BOARD/FRS
To (b) (6) Donald L
cc
09/15/2008 08:51 AM
Subject Fw: Thank you
FYI.

Not Responsive
BOG-- FOIA 10-251 --000518

To: Roberto Perli
Subject: Re: aig
Date: 09/15/2008 09:00 AM
ok, htanks
Office: 202-452-3579
Mobile: 703-340-4542
▼ Roberto Perli/BOARD/FRS
Roberto
Perli/BOARD/FRS
cc
09/15/2008 08:52 AM Subject
Re: aig
Aa3 and AA-, I don't know fitch
William R
Nelson/BOARD/FRS
To Roberto Perli/BOARD/FRS@BOARD
cc
09/15/2008 08:28 AM Subject aig
what were they rated by the three rating agencies on Friday? (long term senior
unsecured). thanks.
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000519

To: Scott Alvarez
Subject: Fw: aig slightly revised
Date: 09/15/2008 09:01 AM
Binder1.pdf
Hi Scott, Brian asked that I send this to you.
--Bill
Office: 202-452-3579
Mobile: 703-340-4542
William R
Nelson/BOARD/FRS
cc
09/15/2008 08:47 AM Subject aig slightly revised
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000520

(b) (5)
BOG-- FOIA 10-251 --000521

(b) (5)
BOG-- FOIA 10-251 --000522

(b) (5)
BOG-- FOIA 10-251 --000523

(b) (5)
BOG-- FOIA 10-251 --000524

(b) (5)
BOG-- FOIA 10-251 --000525

(b) (5)
BOG-- FOIA 10-251 --000526

(b) (5)
BOG-- FOIA 10-251 --000527

(b) (5)
BOG-- FOIA 10-251 --000528

(b) (5)
BOG-- FOIA 10-251 --000529

(b) (5)
BOG-- FOIA 10-251 --000530

(b) (5)
BOG-- FOIA 10-251 --000531

(b) (5)
BOG-- FOIA 10-251 --000532



2008 2007
Assets:
$393,170) $ 393,316 $ 397,372
Equity securities:
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
2008 – $36; 2007 – $233) 33,311 31,234
Cash 2,229 2,284
$5,446) 5,692 5,518
Goodwill 10,661 9,414
Total assets $1,049,876 $1,048,361
1 BOG-- FOIA 10-251 --000533


2008 2007
Liabilities:
$8,338) 9,659 8,331
value: 2008 – $240) 6,165 4,903
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
2 BOG-- FOIA 10-251 --000534


2008 2007 2008 2007
Revenues:
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000535

Segment Results
Statements.)
Total revenues(a):
Other 208 263 (21) 80 394 (80)
Total $ 19,933 $31,150 (36)% $ 33,964 $61,795 (45)%
Other (715) (460) — (1,483) (930) —
Total $ (8,756) $ 6,328 — $(20,020) $12,500 —%
To: William B English; Roberto Perli; Michael S Gibson; Jon D Greenlee
Subject: Fw: aig slightly revised
Date: 09/15/2008 09:02 AM
Binder1.pdf
AIG is a hot issue this morning. here is the current draft of the memo.
Office: 202-452-3579
Mobile: 703-340-4542
William R
Nelson/BOARD/FRS
cc
09/15/2008 08:47 AM Subject aig slightly revised
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000537

(b) (5)
BOG-- FOIA 10-251 --000538

(b) (5)
BOG-- FOIA 10-251 --000539

(b) (5)
BOG-- FOIA 10-251 --000540

(b) (5)
BOG-- FOIA 10-251 --000541

(b) (5)
BOG-- FOIA 10-251 --000542

(b) (5)
BOG-- FOIA 10-251 --000543

(b) (5)
BOG-- FOIA 10-251 --000544

(b) (5)
BOG-- FOIA 10-251 --000545

(b) (5)
BOG-- FOIA 10-251 --000546

(b) (5)
BOG-- FOIA 10-251 --000547

(b) (5)
BOG-- FOIA 10-251 --000548

(b) (5)
BOG-- FOIA 10-251 --000549



2008 2007
Assets:
$393,170) $ 393,316 $ 397,372
Equity securities:
(2008 – $11,359; 2007 – $10,499) 43,887 41,984
2008 – $36; 2007 – $233) 33,311 31,234
Cash 2,229 2,284
$5,446) 5,692 5,518
Goodwill 10,661 9,414
Total assets $1,049,876 $1,048,361
1 BOG-- FOIA 10-251 --000550


2008 2007
Liabilities:
$8,338) 9,659 8,331
value: 2008 – $240) 6,165 4,903
2,948,038,001; 2007 – 2,751,327,476 7,370 6,878
2 BOG-- FOIA 10-251 --000551


2008 2007 2008 2007
Revenues:
portfolio (5,565) — (14,672) —
Other income 3,116 3,792 6,717 7,741
Total revenues 19,933 31,150 33,964 61,795
Net income (loss) $ (5,357) $ 4,277 $(13,162) $ 8,407
Basic $ (2.06) $ 1.64 $ (5.11) $ 3.22
Diluted $ (2.06) $ 1.64 $ (5.11) $ 3.21
Basic 2,605 2,602 2,575 2,607
Diluted 2,605 2,613 2,575 2,621
3 BOG-- FOIA 10-251 --000552

Segment Results
Statements.)
Total revenues(a):
Other 208 263 (21) 80 394 (80)
Total $ 19,933 $31,150 (36)% $ 33,964 $61,795 (45)%
Other (715) (460) — (1,483) (930) —
Total $ (8,756) $ 6,328 — $(20,020) $12,500 —%
Subject: Re: Fw: aig slightly revised
Date: 09/15/2008 09:19 AM
no. but brian may have.
Office: 202-452-3579
Mobile: 703-340-4542
Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS cc
Subject
Re: Fw: aig slightly revised
09/15/2008 09:17 AM
Have you heard anything new from NY?
William R
Nelson/BOARD/FRS
09/15/2008 09:02 AM Greenlee/BOARD/FRS@BOARD
cc
Subject Fw: aig slightly revised
Duplicate
BOG-- FOIA 10-251 --000554

To: Gustavo A Suarez
Cc: Daniel M Covitz; Gustavo A Suarez; JNellie Liang
Date: 09/15/2008 09:19 AM
Thanks for this. Info on maturity profile would be valuable too if available. Also we
would like to get similar info for (b) (5) Thanks again for the quick
turnaround.
▼ Gustavo A Suarez/BOARD/FRS@BOARD
Gustavo A
To Alejandro LaTorre/NY/FRS@FRS
cc Daniel M Covitz/BOARD/FRS@BOARD, JNellie
Liang/BOARD/FRS@BOARD, Gustavo A
09/15/2008 09:11 AM Suarez/BOARD/FRS@BOARD
Subject
Alejandro,
Please find attached some data on unsecured commercial paper outstanding and
yields for AIG Funding Inc. AIG also sponsors two ABCP programs, and an affiliate
of AIG sponsored an SIV not included in the file. The two ABCP programs and the
SIV combine for less commercial paper outstanding than AIG itself. We will try to
get more info about these last three programs over the course of the morning.
As previously, this message and the data attached are internal FR - confidential.
Please make sure to encrypt if forwarding is necessary.
▼ Alejandro LaTorre/NY/FRS@FRS
Alejandro
LaTorre/NY/FRS@FRS
To JNellie Liang/BOARD/FRS@BOARD
cc Daniel M Covitz/BOARD/FRS@BOARD, Gustavo A
Suarez/BOARD/FRS@BOARD, JNellie
09/14/2008 09:26 PM Liang/BOARD/FRS@BOARD
Subject
Duplicate
BOG-- FOIA 10-251 --000555

From: Diane Fraser@frb gov
To: Elise.Liebers@ny.frb.org; Bart.S mon@bos.frb.org; Cynthia.L.Martin@bos.frb.org; Cynthia.L.Bordelon@chi.frb.org
Subject: AIG shares drop n premarket trading
Date: 09/15/2008 09:31 AM
Business Insurance
AIG shares drop in premarket trading
Sept 15, 2008
NEW YORK (Reuters)—Shares of American International Group Inc fell nearly 40% in premarket trading after reports that the insurer had turned to the Federal Reserve for
$40 billion in bridge financing to ward off a liquidity crisis and ratings downgrades
The up-front cost of insuring $10 million of AIG's debt for five years jumped to $3 05 million from $1 3 million on Friday, in addition to annual payments of $500,000,
according to Markit Intraday
The insurer, which has incurred $18 billion in losses over the past three quarters from guarantees it wrote on mortgage derivatives, was hit on Friday by Standard & Poor's
putting the company's credit ratings on negative watch, indicating a possible downgrade
Over the weekend, AIG executives and New York state insurance regulators scrambled to hatch a plan that would boost AIG's liquidity
It was not clear early on Monday when AIG would reach a plan A spokesman did not immediately return a call seeking comment
AIG shares have fallen about 80% since the start of the year
Several analysts, in research reports on Monday, warned that the company is unlikely to resemble itself after a much-anticipated restructuring AIG has been considering "a
wide range of options," the company said, including selling off valuable assets
AIG, until recently the world's largest insurer, does business in 130 countries and territories around the world, selling insurance to 74 million customers worldwide
It has also an aircraft leasing arm, an asset management business and a financial products unit The latter holds a credit default swap portfolio that has triggered the large
mortgage losses
AIG shares were down $4 46, or 36 7%, at $7 68 in premarket trade They reached a 52-week high of $70 13 on Oct 9, 2007
BOG-- FOIA 10-251 --000556

From: Cynthia.L.Martin@bos.frb.org
To: Diane.Fraser@frb.gov
Cc: Bart.Simon@bos.frb.org; Cynthia.L.Bordelon@chi.frb.org; Diane.Fraser@frb.gov; Elise.Liebers@ny.frb.org
Subject: Re: AIG shares drop in premarket trading
Date: 09/15/2008 10:04 AM
On the news just now - AIG to announce its restructuring plan this morning.
Cynthia Martin
Federal Reserve Bank of Boston
600 Atlantic Avenue
Boston, MA 02210
617 973-3178 (office)

617 619-8478 (fax)
BOG-- FOIA 10-251 --000557

To: Patricia Mosser
Subject: Any news on an aig deal?
Date: 09/15/2008 10:11 AM
Office: 202-452-3579
Mobile: 202-725-3612
BOG-- FOIA 10-251 --000558

To: Sabeth I Siddique; James Embersit; Nina Nichols; Adrienne Haden
Subject: Fw: DB Clearing & Settlement update #2
Date: 09/15/2008 10:11 AM
Jon Greenlee
Associate Director
Phone (202) 452-2962
John
Harvey/NY/FRS@FRS
To NY Bank Sup - LFI CPC Updates@FRS
cc Christopher Hunter/NY/FRS@FRS
09/15/2008 09:30 AM Subject DB Clearing & Settlement update #2
Please note the following update from Tom Devine, Director – Global Markets at 8:45 am.
Not Responsive
AIG
(b)(4) & (b)(8)
Not
Responsive
BOG-- FOIA 10-251 --000559

To: Deborah P Bailey; Betsy Cross; Sabeth I Siddique; James Embersit; Adrienne Haden; Nina Nichols
Subject: Fw: counterparty discussion.
Date: 09/15/2008 10:22 AM
Jon Greenlee
Associate Director
Phone (202) 452-2962
Richard
Westerkamp/RICH/FRS@FRS
To Barbara Yelcich/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Caroline
Frawley/NY/FRS@FRS, Chris
09/15/2008 10:17 AM Haley/BOS/FRS@FRS, Coryann
Stefansson/BOARD/FRS@BOARD, Deborah
Lohnau/NY/FRS@FRS, James
Wall/NY/FRS@FRS, Jane
Wakefield/NY/FRS@FRS, Jennifer
Burns/RICH/FRS@FRS, John
Harvey/NY/FRS@FRS, John
Ruocco/NY/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD, Karen
Kahrs/NY/FRS@FRS, Lisa A
White/RICH/FRS@FRS, Lisa
Joniaux/NY/FRS@FRS, Michael
Johnson/SF/FRS@FRS, Raymond A
Bacon/BSR/CHI/FRS@FRS, Richard
Westerkamp/RICH/FRS@FRS, Sarah
Dahlgren/NY/FRS@FRS, Stanley
Poszywak/RICH/FRS@FRS, Stephanie
Chaly/NY/FRS@FRS, Steven J
Manzari/NY/FRS@FRS, Theresa
Barry/BOS/FRS@FRS, Todd
Waszkelewicz/NY/FRS@FRS, Wendy E
Kallery/BSR/CHI/FRS@FRS, Philip
Aquilino/SF/FRS@FRS
cc Jennifer.Burns@rich.frb.org, Mac
Alfriend/RICH/FRS@FRS, Ryan
Rehorn/RICH/FRS@FRS, Warren
Morris/RICH/FRS@FRS, Stanley
Poszywak/RICH/FRS@FRS, Elizabeth
Gress/RICH/FRS@FRS, Ron
Fox/RICH/FRS@FRS, Gregory H
Feldberg/BOARD/FRS@BOARD
Subject counterparty discussion.
BOG-- FOIA 10-251 --000560

Date: DATE \@ "MMMM d, yyyy" September 15, 2008
To: Files
From: Ryan Rehorn
Subject: Wachovia Counterparty Call, 7:00 am on Lehman, WaMu, AIG, ML
(b)(4) & (b)(8)
Not Responsive
(b)(4) & (b)(8)
Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000561

Not Responsive
BOG-- FOIA 10-251 --000562

Not Responsive
BOG-- FOIA 10-251 --000563

To: Sabeth I Siddique; Adrienne Haden; James Embersit; Nina Nichols; Deborah P Bailey
Subject: Fw: BAC - Counterparty Credit Update - Restricted FR (highly sensitive)
Date: 09/15/2008 10:26 AM
Attachments: AIG 080912 xls
Not Responsive
Jon Greenlee
Associate Director
Phone (202) 452-2962
Brad
Evans/RICH/FRS@FRS
To Barbara Yelcich/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Caroline Frawley/NY/FRS@FRS,
Chris Haley/BOS/FRS@FRS, Coryann
09/15/2008 10:22 AM Stefansson/BOARD/FRS@BOARD, Deborah
Lohnau/NY/FRS@FRS, James Wall/NY/FRS@FRS, Jane
Wakefield/NY/FRS@FRS, Jennifer
Burns/RICH/FRS@FRS, John Harvey/NY/FRS@FRS,
John Ruocco/NY/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD, Karen
Kahrs/NY/FRS@FRS, Lisa A White/RICH/FRS@FRS,
Lisa Joniaux/NY/FRS@FRS, Michael
Johnson/SF/FRS@FRS, Philip Aquilino/SF/FRS@FRS,
Raymond A Bacon/BSR/CHI/FRS@FRS, Richard
Westerkamp/RICH/FRS@FRS, Sarah
Dahlgren/NY/FRS@FRS, Stanley
Poszywak/RICH/FRS@FRS, Stephanie
Theresa Barry/BOS/FRS@FRS, Todd
Waszkelewicz/NY/FRS@FRS, Wendy E
Kallery/BSR/CHI/FRS@FRS
cc Jennifer Burns/RICH/FRS@FRS, Lisa A
White/RICH/FRS@FRS, Karen
Craigmile/RICH/FRS@FRS, Frank
Mayhew/RICH/FRS@FRS, Kerri
Firestone/RICH/FRS@FRS, Alan Michael, Jodie
Goff/RICH/FRS@FRS, David Schwartz/RICH/FRS@FRS,
Christopher Cook/RICH/FRS@FRS, Stacy L
Coleman/RICH/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS, Steven Mirsky/NY/FRS@FRS,
Kyle Grieser/NY/FRS@FRS, Laxmi Rao/NY/FRS@FRS,
Mac Alfriend/RICH/FRS@FRS
Subject BAC - Counterparty Credit Update - Restricted FR
(highly sensitive)
Please find attached BAC's tear sheet data for "heightened monitoring" counterparty
exposures. (b)(4) & (b)(8)
BOG-- FOIA 10-251 --000564

(b)(4) & (b)(8)
Not Responsive
Not Responsive
Best Regards,
Brad Evans & Kerri Firestone

Federal Reserve
"There cannot be a crisis next week. My schedule is already full."
Henry Kissinger
BOG-- FOIA 10-251 --000565

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000566

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000567

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000568

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000569

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000570

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000571

BOG-- FOIA 10-251 --000572
BOG-- FOIA 10-251 --000573
BOG-- FOIA 10-251 --000574
BOG-- FOIA 10-251 --000575
Not Responsive
BOG-- FOIA 10-251 --000576

Not Responsive
BOG-- FOIA 10-251 --000577

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000578

Not Responsive
BOG-- FOIA 10-251 --000579

Not Responsive
BOG-- FOIA 10-251 --000580

Not Responsive
BOG-- FOIA 10-251 --000581

BOG-- FOIA 10-251 --000582
BOG-- FOIA 10-251 --000583
Not Responsive
BOG-- FOIA 10-251 --000584

Not Responsive
(
BOG-- FOIA 10-251 --000585

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000586

Not Responsive
BOG-- FOIA 10-251 --000587

Not Responsive
BOG-- FOIA 10-251 --000588

Not Responsive
BOG-- FOIA 10-251 --000589

Not Responsive
BOG-- FOIA 10-251 --000590

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000591

Not Responsive
BOG-- FOIA 10-251 --000592

BOG-- FOIA 10-251 --000593
BOG-- FOIA 10-251 --000594
BOG-- FOIA 10-251 --000595
BOG-- FOIA 10-251 --000596
Not Responsive
BOG-- FOIA 10-251 --000597

Not Responsive
BOG-- FOIA 10-251 --000598

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000599

Not Responsive
BOG-- FOIA 10-251 --000600

Not Responsive
BOG-- FOIA 10-251 --000601

Not Responsive
BOG-- FOIA 10-251 --000602

BOG-- FOIA 10-251 --000603
BOG-- FOIA 10-251 --000604
BOG-- FOIA 10-251 --000605
Not Responsive
BOG-- FOIA 10-251 --000606

Not Responsive
BOG-- FOIA 10-251 --000607

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000608

Not Responsive
BOG-- FOIA 10-251 --000609

Not Responsive
BOG-- FOIA 10-251 --000610

F om Wi l am R Nelson
To at ic a Mos e
Subject Re Any news on an a g deal?
Date 09/15/2008 10 31 AM
Thanks.
Ema l william.r.nelson@frb.go
Office 202- 52-3579
Mobile 202-725-3612
From Patric a.Mosser

Sent 09 15/2008 10 26 AM AST
To William Nelson
Cc Ale andro LaTorre
Subject Re Any news on an a g deal?
Not yet. But they have prom sed announcements before and then not had anything to report.... We ll keep you posted. Also let you know if we have another ca l with them. Frankly things have been in such a state of flux that they don t seem to have much to report.
Wi liam R.Nelson@frb.gov
o " at c a Mosse "
09 5 2008 0 4 AM < at icia Mosse @ny b o g>
cc
Sub ect Any news on an aig deal?
Email william r nelson@frb gov

Office 202-452-3579
Mobile 202-725-3612
BOG-- FOIA 10-251 --000611

From: Kim Jensik
To: Adrienne Haden; Nina Nichols; Sabeth I Siddique
Subject: 10:30 call info
Date: 09/15/2008 10:41 AM
Importance: High
As per Dianne Dobbeck:

A conf. call meeting to discuss AIG & knock-on to other institutions
has been scheduled for today:
Date: Sept. 15, 2008

Time: 10:30am
Location: 25th Floor Southeast Conf. Call.
Teleconference info:
Dial: 877 810 9415
Participant: 4169466
Host: 2975
Senior Staff Assistant

BS&R Div, Federal Reserve Board
Phone: 202/736-5555
Fax: 202/452-2770
BOG-- FOIA 10-251 --000612

From: Calvin Mitchell
Subject: Re:
Date: 09/15/2008 10:47 AM
When you're done.

At 11:30 am, we're hosting, along with NYS insurance superintendent and TRS
reps (no Paulson), a group to discuss the situation re AIG. At the request
of AIG and an industry consortium, we are providing premises to discuss
their situation.
TFG said I can confirm on background once underway.

From: Michelle A Smith
Sent: 09/15/2008 10:38 AM EDT
To: Calvin Mitchell
Subject: Re:
We're in our board mtg. Shd I step out?

From: Calvin.Mitchell
Sent: 09/15/2008 10:40 AM AST
To: Michelle Smith
Call me in TFG's office please. Thx.
BOG-- FOIA 10-251 --000613

To: (b) (6) Donald L Kohn; Kevin Warsh; Brian F Madigan; Scott Alvarez
Subject: AIG mtg at FRBNY
Date: 09/15/2008 10:50 AM

Sent: 09/15/2008 10:50 AM EDT
To: Michelle Smith
Subject: Re:
When you're done.

their situation.
Duplicate
BOG-- FOIA 10-251 --000614

To: Diann Townsend; Kwayne Jennings
Cc: Ron Feldman
Subject: Re: AIG and Wamu
Date: 09/15/2008 11:01 AM
(b)(4) & (b)(8)
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
▼ Diann Townsend

From: Diann Townsend
Sent: 09/15/2008 09:58 AM CDT
To: Coryann Stefansson; Kwayne Jennings
Cc: Ron Feldman
Subject: AIG and Wamu (
(b)(4) & (b)(8)
Please let me know if you'd like any additional information.
Diann Townsend
Supervision, Regulation, and Credit
Federal Reserve Bank of Minneapolis
612-204-6130
BOG-- FOIA 10-251 --000615

From: Kevin Warsh
Subject: Fw: AIG mtg at FRBNY
Date: 09/15/2008 11:02 AM
May be goof for u to attend

----------------------------------------------------------------------------
----

Sent 0:50 AM EDT
To: (b) (6) Donald Kohn; Kevin Warsh; Brian Madigan; Scott Alvarez
Subj t FRBNY

Sent: 09/15/2008 10:50 AM EDT
To: Michelle Smith
Subject: Re:
When you're done.

their situation.
Duplicate
BOG-- FOIA 10-251 --000616

To: Kevin Warsh
Subject: Re: AIG mtg at FRBNY
Date: 09/15/2008 11:05 AM
I haven't been invited and will lay low. Pat

From: Kevin.Warsh
Sent: 09/15/2008 11:02 AM AST
Subject: Fw: AIG mtg at FRBNY
May be goof for u to attend

----------------------------------------------------------------------------
----

Sent 0:50 AM EDT
To: (b) (6) Donald Kohn; Kevin Warsh; Brian Madigan; Scott Alvarez
Subj t FRBNY

Sent: 09/15/2008 10:50 AM EDT
To: Michelle Smith
Subject: Re:
When you're done.

their situation.

Sent: 09/15/2008 10:38 AM EDT
To: Calvin Mitchell
Subject: Re:
We're in our board mtg. Shd I step out?

Sent: 09/15/2008 10:40 AM AST
BOG-- FOIA 10-251 --000617

From: Meredith J Beechey
To: MA FMA Eventstudy
Cc: Steve A Sharpe
Subject: Early reaction to the weekend's events
Date: 09/15/2008 11:07 AM
Attachments: earlytable.pdf
Attached is a table summarizing the market reaction between close of business

Friday and open on Monday to the weekend's events, including:
- Lehman's bankruptcy, the purchase of Merril Lynch by Bank of America, and

reported difficulties at AIG,
- the announcement on Sunday of enhancements of the Federal Reserve's liquidity
facilities, and
- a joint statement by a consortium of major banks creating a liquidity pool for
participant borrowing.
Rates on interest rate futures declined sharply at all maturities and nominal Treasury
yields were also sharply lower. The two year yield was down 38 basis points, the
ten-year down 20 basis points. Equity futures were down about 4 percent.
Another table will be distributed later in the day.
Meredith Beechey
BOG-- FOIA 10-251 --000618

Market Reaction to Announcement of September 14, 2008 Enhancement to Liquidity Facilities
Friday Monday Early

5-Sep-2008 15-Sep-08 Change
5:00 PM 08:05 AM
(1) (2) (2)-(1)
Treasury Coupon Yields basis points

Two-Year 2.22 1.84 -37.5
Five-Year 2.95 2.63 -32.3
Ten-Year 3.72 3.52 -19.5
Equity Prices percent change

S&P 500* 1251.7 1239.7 -1.0
S&P Futures 1258.5 1209.7 -3.9
TIPS basis points

Five-Year 1.46 1.29 -16.4
Ten-Year 1.77 1.65 -12.0
Fed Funds Futures basis points

Oct 1.97 1.81 -16.5
Nov 1.93 1.75 -17.5
Dec 1.91 1.69 -22.0
Jan 1.92 1.67 -25.0
Eurodollar Futures basis points

S-08 2.82 2.82 -0.1
D-08 2.93 2.70 -23.5
M-09 2.82 2.49 -32.5
J-09 2.92 2.57 -34.5
S-09 3.08 2.74 -34.0
Libor OIS Spreads basis points

One-month 53.09 71.81 18.73
Three-Month 86.33 105.13 18.80
Six-Month 105.43 137.59 32.16
CDS* basis points

iTraxx (Europe) 102.86 130.22 27.36
CDX (US) 151.69 NA NA
F/X Quotes percent change

Yen/Dollar 107.9870 105.6820 -2.1
Dollar/Euro 1.4209 1.4126 -0.6
* Mkt open 9:30am

** Observation at 9:15am
BOG-- FOIA 10-251 --000619

From: Krishna.Guha@FT.com
To: Michelle.A.Smith@frb.gov
Subject: Re: trying to reach you... (sorry)
Date: 09/15/2008 11:13 AM
i really don't think you're going to be able to help me at all.

but for what its worth...
i am writing a piece saying the Fed will likely seek maximum flexibility to
respond to the fast-evolving financial crisis in the first instance, rather
than cut rates immediately.
i know you can't comment on this. i just wanted to let you know anyway.
seperately, kevin sounded sceptical on extending credit to AIG - i wondered
if this was the result of being exhausted after a mad weekend or a fair
reflection of the stance at this juncture.
K
Michelle.A.Smith@
frb.gov
To
09/15/2008 11:08 "Krishna Guha"
AM <Krishna.Guha@FT.com>
cc
Subject
Re: trying to reach you... (sorry)
Am in our board mtg.

Want to talk by email?

From: Krishna.Guha
Sent: 09/15/2008 11:09 AM AST
To: Michelle Smith
Subject: trying to reach you... (sorry)
**********************************************************************************
This email may contain confidential material. If you were not an intended
recipient, please notify the sender and delete all copies. We may monitor
email to and from our network.
BOG-- FOIA 10-251 --000620

This email was sent by a company within the FT Group.
The Financial Times Limited, registered in England and Wales number 227590.
Registered office: Number One Southwark Bridge, London SE1 9HL. VAT: GB 278
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This email may contain confidential material. If you were not an intended
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email to and from our network.
This email was sent by a company within the FT Group.
The Financial Times Limited, registered in England and Wales number 227590.
Registered office: Number One Southwark Bridge, London SE1 9HL. VAT: GB 278
5371 21.
The Financial Times (HK) Limited, registered in Hong Kong number 108204.
Registered office: Unit 5905-5912, 59/F The Center, No.99 Queen’s Road
Central, Hong Kong.
FT Publications Inc, incorporated in New York, number 13-2545828.

Registered Office: 1330 Avenue of the Americas, New York, NY 10019, USA.
BOG-- FOIA 10-251 --000621

From: Thomas J O'Keeffe
To: Alejandro LaTorre; Alexa Philo; Amy White; Andrew Small; Anthony Cirillo; Arthur Angulo; Barbara Gorzkowski;
Barbara Yelcich; Bard Stermasi; Brandon Hall; Brian Peters; Caren Cox; Caroline Frawley; Caroline Nuffort;
Catherine A Tilford; Catherine Voigts; Chris Haley; Chris McCurdy; Christina Zausner; Christopher Calabia;
Christopher Powell; Claudia Franco; Clinton Lively; Corbin Long; Coryann Stefansson; Craig F Marchbanks;
Craig Leiby; Cynthia Graves; Daniel Muccia; Daniel Sullivan; Deborah Lohnau; Deborah P Bailey; Denise
Goodstein; Dennis Herbst; Dennis Ryan; Dianne Dobbeck; Dmitry J Gershik; Elizabeth Gress; Elizabeth Tafone;
Gail Santora; Genevievette.E.Walker@frb.gov; Gerard Dages; Glen Reppy; Gretchen Cappiello; Gretchen
Walker; H Clay Saylor; Hasan Latif; Hayley Boesky; Homer Hill; Isabella Lo Piccolo; Jack Jennings; James
Embersit; James Hodgetts; James Wall; Jan Voigts; Jane Green; Jane Majeski; Jane Wakefield; Jeanmarie
Davis; Jeffrey Kowalak; Jeffrey Levine; Jeffrey Plaskett; Jim Mahoney; Joanna Wisniecka; John Beebe; John
Heinze; John Reynolds; John Ricketti; John Ruocco; Jon D Greenlee; Jonathan Polk; Joseph Galati; Judith J
Gruttman; Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kenton Beerman; Kerry STREETS; Kevin
Clarke; Kevin Coffey; Kevin Lee; Kevin Littler; Kirsten Harlow; Kyle Grieser; Lance Auer; Larry Bonnemere;
Laura A Macedo; Lawrence ROSTOKER; Laxmi Rao; Lily Tham; Linda Rodriguez; Lisa A White; Lisa Joniaux;
Lucinda M Brickler; Lydia Tshulos; Mark Scapp; Meg McConnell; Meinrad Danzer; Michael Johnson; Myron L
Kwast; Bin Lang; Brian Hefferle; Caroline Nuffort; Isabella Lo Piccolo; Joanna Wisniecka; Joshua Sherwin;
Kathryn Chen; Kenton Beerman; Mayra Gonzalez; Randolph Brown; Susan G Ballinger; Susan Goldberg;
Thomas J O'Keeffe; Pamela S Powell; Pat Soriano; Patrick M Parkinson; Patrick Roche; Philip Aquilino; Ralph
Santasiero; Randolph Brown; Renuka Vijayanathan; Richard Heeseler; Richard Kunen; Richard Naylor; Richard
Roberts; Richard Westerkamp; Rick Weaver; Robert D Patalano; Robert Gutierrez; Roberto Perli; Roger
Graham; Rohit Bansal; Ron Fox; Ronald Stroz; Sandy Krieger; Sara Mahmoud; Sarah Dahlgren;
Stacy.L.Coleman@rich.frb.org; Stanley Poszywak; Stephanie Chaly; Steven Friedman; Steven J Manzari; Steven
Mirsky; Susan G Ballinger; Susan Goldberg; Terrence Checki; Theodore Lubke; Theonilla Lee-Chan; Theresa
Barry; Thomas Dolan; Thomas J O'Keeffe; Tim.P.Clark@frb.gov; Todd Waszkelewicz; Wendy Ng; William B
English; William BRODOWS; William Rutledge; Wing Oon
Cc: Bin Lang; Brian Hefferle; Caroline Nuffort; Isabella Lo Piccolo; Joanna Wisniecka; Joshua Sherwin; Kathryn
Chen; Kenton Beerman; Mayra Gonzalez; Randolph Brown; Susan G Ballinger; Susan Goldberg; Thomas J
O'Keeffe
Subject: AM Liquidity Update
Date: 09/15/2008 11:25 AM
Importance: High
Restricted F.R.
AM Liquidity Team Update:

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000622

(b)(4) & (b)(8)
************************************************
Thomas J. O'Keeffe, CFA
Bank Supervision
(212)720-5568
***********************************************
BOG-- FOIA 10-251 --000623

Cc: Michael S Gibson; Roberto Perli; William B English
Date: 09/15/2008 11:27 AM
Let me know how we may help.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
William R
Nelson/BOARD/FRS
09/15/2008 09:02 AM Greenlee/BOARD/FRS@BOARD
cc
Subject Fw: aig slightly revised
Duplicate
BOG-- FOIA 10-251 --000624

From: Scott Alvarez
Date: 09/15/2008 11:36 AM
Bill,
(b) (5)
Scott
William R
Nelson/BOARD/FRS
cc
09/15/2008 09:01 AM Subject Fw: aig slightly revised
Duplicate
BOG-- FOIA 10-251 --000625

Subject: AIG corporate structure
Date: 09/15/2008 12:14 PM
Attachments: aig-corporate-structure.pdf
BOG-- FOIA 10-251 --000626

SNL Interactive: Briefing Book: Corporate Structure http://www.snl.com/interactivex/ParentSubTree.aspx?ResetDefaults=1...
(b) (4)
BOG-- FOIA 10-251 --000627
1 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000628
2 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000629
3 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000630
4 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000631
5 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000632
6 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000633
7 of 9 9/15/2008 12:13 PM
(b) (4)
BOG-- FOIA 10-251 --000634
8 of 9 9/15/2008 12:13 PM
(b) (4)
Site content and design Copyright © 2008, SNL Financial LC

Usage of this product is governed by the Master Subscription Agreement.
SNL Financial LC, One SNL Plaza, PO Box 2124, Charlottesville, Virginia 22902, (434) 977-1600
BOG-- FOIA 10-251 --000635
9 of 9 9/15/2008 12:13 PM
From: Jill K Cetina
To: RBOPS PAYMENT SYSTEM RISK; RBOPS CSS
Cc: Donald Hammond; Gregory L Evans
Subject: Fw: WSJ.com - AIG Scrambles to Raise Cash, Talks to Fed
Date: 09/15/2008 12:14 PM
Note that AIG is reported to have some VERY large CDS positions -- with European
banks as counterparties.
----- Forwarded by Jill K Cetina/BOARD/FRS on 09/15/2008 12:06 PM -----
cetina@verizon.net
To jill.k.cetina@frb.gov
cc
09/15/2008 12:05 PM
Subject WSJ.com - AIG Scrambles to Raise Cash, Talks to Fed

Powered by
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Click the following to access the sent link:

WSJ.com - AIG Scrambles to Raise Cash, Talks to Fed * This article will be available to non -subscribers of the
Online Journal for up to seven days after it is e-mailed.
BOG-- FOIA 10-251 --000636

Get your EMAIL THIS Browser Button and use it to email content from any Web site. Click here for more
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lMyQjAxMDI4MjExNTQxODU1Wj.html
BOG-- FOIA 10-251 --000637

From: (b)(4) &
To: patrick.e.mccabe@frb.gov
Subject: You are probably busy, but....
Date: 09/15/2008 12:18 PM
You said the last time we spoke to touch base if I ever have concerns...
The lack of a resolution on AIG keeps markets unsettled.

Money funds (fortunately not us) could see their NAVs at risk due to the
markdown to zero of their Lehman holdings.
Market talk about who is next.
You probably can't say...but are you hearing of any money funds in
distress due to their holdings, or ancillary price pressures?
My opinion is that the Fed should be considering "emergency easing" if
for no other reason to alleviate pricing in the money markets and more
specifically to protect from potential "breaking the buck" on the part
of some money funds out there.
The Fed could cut rates and wrap "emergency" and "temporary" language
around the move to communicate that such a move is designed to give
markets a chance to catch its breath.
Just my thoughts.
(b) (6)
(b) (4)
BOG-- FOIA 10-251 --000638

From: Diane Fraser
To: Sabeth I Siddique; James Embersit; Nina Nichols
Cc: Barbara Cornyn; Diane.Fraser@frb.gov; Donald N Gabbai; David K Lynch; Craig F Marchbanks
Subject: Fw: Notes from 9/14/08 conf. call w/ New York State Insurance Dept. Superintendent Dinallo re: AIG
Date: 09/15/2008 12:21 PM
FYI.
cc Adrienne.Haden@frb.gov, Diane.Fraser@frb.gov
09/14/2008 10:09 PM
Subject Notes from 9/14/08 conf. call w/ New York State
Insurance Dept. Superintendent Dinallo re: AIG
Jon,
Per your request.
Please distribute to others who may find these notes useful.
Diane
BOG-- FOIA 10-251 --000639

RESTRICTED FR
Conference Call with Eric Dinallo, Superintendent

New York State Insurance Department (NYSID)
Regarding the Financial Condition of American International Group, Inc. (AIG)
September 14, 2008
(b)(4), (b)(5), & (b)(8)
1
BOG-- FOIA 10-251 --000640
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
2
BOG-- FOIA 10-251 --000641
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
3
BOG-- FOIA 10-251 --000642
RESTRICTED FR
(b)(4), (b)(5), & (b)(8)
4
BOG-- FOIA 10-251 --000643
From: Antonio Alvarez
To: NY Bank Sup - LFI CPC Updates
Cc: William Hilton; Louis Braunstein; William Hallacy; Glen Snajder; Rinku Shah; John Ruocco; Eric Breitweiser;
Anne Chiou; Sara Mahmoud; Jacqueline Lovisa; Sola Majolagbe; Glen Reppy; Katheryn Van der Celen; Calvin
Bailey; Timothy Sheridan; Christina Zausner; Steven J Manzari
Subject: Citi Counterparty Update 9-15-08 AM
Date: 09/15/2008 12:25 PM
Mid Morning Discussions Tom Fontana, FIs Risk Management), and OCC.
Not Responsive
AIG Exposure
(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000644

(b)(4) & (b)(8)
We expect to get Wachovia exposure during our next update later in the day/
evening.
Regards,
----------------------------------------------------
Antonio Alvarez
Credit Risk Coordinator - Wholesale
Citigroup Continuous Monitoring Team
Citigroup On-site: (212) 527-1255;
FRBNY Voicemail: (212) 720-5069
Blackberry: (718) 612-3095
BOG-- FOIA 10-251 --000645

From: Nina Nichols
To: Karen L El Kochta
Subject: Fw: Notes from 9/14/08 conf. call w/ New York State Insurance Dept. Superintendent Dinallo re: AIG
Date: 09/15/2008 12:26 PM
----- Forwarded by Nina Nichols/BOARD/FRS on 09/15/2008 12:25 PM -----
Diane
Fraser/BOARD/FRS
To Sabeth I Siddique/BOARD/FRS@BOARD, James
Embersit/BOARD/FRS@BOARD, Nina
Nichols/BOARD/FRS
09/15/2008 12:21 PM cc Barbara Cornyn/BOARD/FRS@BOARD,
Diane.Fraser@frb.gov, Donald N
Gabbai/BOARD/FRS@BOARD, David K
Lynch/BOARD/FRS@BOARD, Craig F
Marchbanks/BOARD/FRS@BOARD
Subject Fw: Notes from 9/14/08 conf. call w/ New York State
FYI.
cc Adrienne.Haden@frb.gov, Diane.Fraser@frb.gov
09/14/2008 10:09 PM
Subject Notes from 9/14/08 conf. call w/ New York State
Duplicate
BOG-- FOIA 10-251 --000646

To: Donald L Kohn; Randall S Kroszner; Elizabeth A Duke
Cc: Roger.Cole@frb.gov; Coryann Stefansson; Jack Jennings; Jon D Greenlee; Jeffrey Marquardt; Jeff Stehm; Brian F
Madigan; Norah Barger
Subject: Fw: MARKETS, HOURLY UPDATE, Monday 15 September 2008, 16.30 MEAT attached
Date: 09/15/2008 12:30 PM
Attachments: MEAT 15 September 2008 1630.pdf
FYI. Update from the UK. We have multiple information streams underway. If you find
this helpful to pass on to others not on the list, please pass it on or let me know and i will.
Thanks
William.Rutledge@ny.frb.org
To christine.cumming@ny.frb.org,
deborah.p.bailey@frb.gov, arthur.angulo@ny.frb.org,
09/15/2008 12:21 PM brian.peters@ny.frb.org, sarah.dahlgren@ny.frb.org,
william.dudley@ny.frb.org, Thomas.Baxter@ny.frb.org,
terrence.checki@ny.frb.org
cc
Subject Fw: MARKETS, HOURLY UPDATE, Monday 15 September
2008, 16.30 MEAT attached
FYI.
----- Forwarded by William Rutledge/NY/FRS on 09/15/2008 12:20 PM -----
"Thomas Huertas"
<Thomas.Huertas@fsa.gov.uk>
To <William.Rutledge@ny.frb.org>
09/15/2008 12:21 PM cc <sirrie@sec.gov>
Subject FW: MARKETS, HOURLY UPDATE, Monday 15 September 2008, 16.30

MEAT attached
FYI.
-----Original Message-----
From: Cope, Philip [mailto:Philip.Cope@bankofengland.gsi.gov.uk]
Sent: 15 September 2008 17:01
To: Market News; FSA & HMT Markets updates
Subject: MARKETS, HOURLY UPDATE, Monday 15 September 2008, 16.30 MEAT attached
Please find 16.30 MEAT attached. Many apologies for the delay.
From: Mallett, Martin
Sent: Monday, September 15, 2008 4:55 PM
To: Market News; FSA & HMT Markets updates
BOG-- FOIA 10-251 --000647

(b) (4)
BOG-- FOIA 10-251 --000648

(b) (4)
BOG-- FOIA 10-251 --000649

(b) (4)
BOG-- FOIA 10-251 --000650

This communication and any attachments contains information which is confidential and may
be subject to legal privilege. It is for intended recipients only. If you are not the intended
recipient you must not copy, distribute, publish, rely on or otherwise use it without our
consent. Some of our communications may contain confidential information which it could be
a criminal offence for you to disclose or use without authority. If you have received this email
in error please notify postmaster@fsa.gov.uk immediately and delete the email from your
computer.
The FSA reserves the right to monitor all email communications for compliance with legal,
regulatory and professional standards.
This email is not intended to nor should it be taken to create any legal relations or
contractual relationships. This email has originated from
The Financial Services Authority (FSA)
25 The North Colonnade,
Canary Wharf,
London
E14 5HS
United Kingdom
Registered as a Limited Company in England and Wales No.1920623.
Registered Office as above
Switchboard: 020 7066 1000
Web Site: http://www.fsa.gov.uk
BOG-- FOIA 10-251 --000651

*****************************************************************
BOG-- FOIA 10-251 --000652

(b) (4)
BOG-- FOIA 10-251 --000653

To: William B English; William R Nelson; Michael S Gibson
Subject: Fw: UBS Counterparty call with D.Bawden - Notes
Date: 09/15/2008 12:34 PM
Attachments: LEH calls 9-15 - 10am cntrprty Minutes.doc
The color on AIG might provide some insights into how the market views the firm.
Jon Greenlee
Associate Director
Phone (202) 452-2962
Paul H
Austin/NY/FRS@FRS
Andrew Small/NY/FRS@FRS, Anthony
Cirillo/NY/FRS@FRS, Arthur Angulo/NY/FRS@FRS, Bard
09/15/2008 12:31 PM Stermasi/NY/FRS@FRS, Brandon Hall/NY/FRS@FRS,
Brian Begalle/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Bridget Habib/NY/FRS@FRS,
Caroline Nuffort/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, Chris Haley/BOS/FRS@FRS,
Christina Zausner/NY/FRS@FRS, Christopher
Clinton Lively/NY/FRS@FRS, Corbin
Long/NY/FRS@FRS, Coryann
Stefansson/BOARD/FRS@BOARD, Craig
Leiby/NY/FRS@FRS, Daniel Muccia/NY/FRS@FRS,
Deborah Lohnau/NY/FRS@FRS, Dexter
Williams/NY/FRS@FRS, Dianne Dobbeck/NY/FRS@FRS,
H Clay Saylor/NY/FRS@FRS, Homer Hill/NY/FRS@FRS,
Isabella Lo Piccolo/NY/FRS@FRS, James
Hodgetts/NY/FRS@FRS, Jan Voigts/NY/FRS@FRS,
Jeanmarie Davis/NY/FRS@FRS, Jeffrey
Levine/NY/FRS@FRS, Jennifer Burns/RICH/FRS@FRS,
Jim Mahoney/NY/FRS@FRS, John
Beebe/RICH/FRS@FRS, John Heinze/NY/FRS@FRS,
John Ricketti/NY/FRS@FRS, Jon D
Greenlee/BOARD/FRS@BOARD, Jonathan
Polk/NY/FRS@FRS, Jordan Pollinger/NY/FRS@FRS,
Joseph Galati/NY/FRS@FRS, Judith J
Gruttman/NY/FRS@FRS, Kara Sulmasy/NY/FRS@FRS,
Karen Kahrs/NY/FRS@FRS, Katheryn Van der
Celen/NY/FRS@FRS, Kenton Beerman/NY/FRS@FRS,
Kevin Clarke/NY/FRS@FRS, Kevin Coffey/NY/FRS@FRS,
Kevin Lee/NY/FRS@FRS, Kirsten Harlow/NY/FRS@FRS,
Kyle Grieser/NY/FRS@FRS, Lance Auer/NY/FRS@FRS,
Lawrence ROSTOKER/NY/FRS@FRS, Laxmi
Rao/NY/FRS@FRS, Lucinda M Brickler/NY/FRS@FRS,
Luis Uranga/NY/FRS@FRS, Mark Scapp/NY/FRS@FRS,
Michael Johnson/SF/FRS@FRS, Paul
Whynott/NY/FRS@FRS, Randolph Brown/NY/FRS@FRS,
Richard Kunen/NY/FRS@FRS, Richard
McGee/NY/FRS@FRS, Robert Gutierrez/NY/FRS@FRS,
Roger Graham/NY/FRS@FRS, Ronald
Stroz/NY/FRS@FRS, Sandy Krieger/NY/FRS@FRS,
Sarah Dahlgren/NY/FRS@FRS, Stephanie
Steven Mirsky/NY/FRS@FRS, Susan G
Ballinger/NY/FRS@FRS, Susan Goldberg/NY/FRS@FRS,
Theodore Lubke/NY/FRS@FRS, Theonilla Lee-
Chan/NY/FRS@FRS, Thomas J O'Keeffe/NY/FRS@FRS,
Tim P Clark/BOARD/FRS@BOARD, Todd
BOG-- FOIA 10-251 --000654

Hallacy/NY/FRS@FRS, Wing Oon/NY/FRS@FRS,
Caroline Frawley/NY/FRS, John Reynolds/NY/FRS,
Betsy Gordon/NY/FRS, Christopher Powell/NY/FRS,
Catherine A Tilford/BOARD/FRS@BOARD, Paul
Bhatti/NY/FRS, jordan.pollinger@ny.frb.org
cc
Subject UBS Counterparty call with D.Bawden - Notes
Regards,
Paul
Paul Austin
Bank Supervision
Paul.H.Austin@ny.frb.org
212.720.6127
203.719.7327
BOG-- FOIA 10-251 --000655

(b)(4) & (b)(8)
Not Responsive
1
BOG-- FOIA 10-251 --000656
Not Responsive
2
BOG-- FOIA 10-251 --000657
From: John Reynolds
To: William Hallacy; NY Bank Sup - LFI CPC Updates@FRS
Cc: Caroline.Frawley@ny.frb.org; Steven.Manzari@ny.frb.org; Andrew Small; John Reynolds; Paul Bhatti;
Christopher Powell; Betsy Gordon; Jordan Pollinger; Paul H Austin
Subject: UBS follow-up -- Counterparty Monitoring
Date: 09/15/2008 12:35 PM
In our conversation with UBS folks in London around the time of London's opening
UBS mentioned a few institutions that are concerned with.
(b)(4) & (b)(8)
AIG,
(b)(4) & (b)(8)
John Reynolds
▼ William Hallacy/NY/FRS
William
Hallacy/NY/FRS
To NY BankSup New York CPC, Antonio
Alvarez/NY/FRS@FRS, Gregory Gaare/NY/FRS@FRS,
Moses Cheng/NY/FRS@FRS, Kathleen
09/15/2008 12:01 PM Smalligan/NY/FRS@FRS, Yogesh Shah/NY/FRS@FRS,
Carol Roller/NY/FRS@FRS, Caroline
Frawley/NY/FRS@FRS, Steven J Manzari/NY/FRS@FRS,
John Ricketti/NY/FRS@FRS
cc Steven Mirsky/NY/FRS@FRS, Dexter
Williams/NY/FRS@FRS, Bridget Habib/NY/FRS@FRS,
Jordan Pollinger/NY/FRS@FRS, Kyle
Grieser/NY/FRS@FRS, Dianne Dobbeck/NY/FRS@FRS
Subject Counterparty Monitoring
CPC Teams
(b) (8)
BOG-- FOIA 10-251 --000658

Thanks and keep up the good work --
William Hallacy, CFA

Fed 212-720-2776
Citi 212-583-7104
BOG-- FOIA 10-251 --000659

Subject: Fw: Citi Counterparty Update 9-15-08 AM
Date: 09/15/2008 12:37 PM
More insight on AIG below.
Jon Greenlee
Associate Director
Phone (202) 452-2962
Antonio
Alvarez/NY/FRS@FRS
To NY Bank Sup - LFI CPC Updates
cc William Hilton/NY/FRS@FRS, Louis
Braunstein/NY/FRS@FRS, William
09/15/2008 12:25 PM Hallacy/NY/FRS@FRS, Glen Snajder/NY/FRS@FRS,
Rinku Shah/NY/FRS@FRS, John Ruocco/NY/FRS@FRS,
Eric Breitweiser/NY/FRS@FRS, Anne
Chiou/NY/FRS@FRS, Sara Mahmoud/NY/FRS@FRS,
Jacqueline Lovisa/NY/FRS@FRS, Sola
Majolagbe/NY/FRS@FRS, Glen Reppy/NY/FRS@FRS,
Katheryn Van der Celen/NY/FRS@FRS, Calvin
Bailey/NY/FRS@FRS, Timothy Sheridan/NY/FRS@FRS,
Christina Zausner, Steven J Manzari/NY/FRS@FRS
Subject Citi Counterparty Update 9-15-08 AM
Mid Morning Discussions Tom Fontana, FIs Risk Management), and OCC.
Duplicate
BOG-- FOIA 10-251 --000660

Subject: Fw: UBS follow-up -- Counterparty Monitoring
Date: 09/15/2008 12:37 PM
fyi
Jon Greenlee
Associate Director
Phone (202) 452-2962
John
Reynolds/NY/FRS@FRS
To William Hallacy/NY/FRS@FRS, NY Bank Sup - LFI CPC
Updates@FRS
cc Caroline.Frawley@ny.frb.org,
09/15/2008 12:35 PM Steven.Manzari@ny.frb.org, Andrew
Small/NY/FRS@FRS, John Reynolds/NY/FRS@FRS,
Paul Bhatti/NY/FRS@FRS, Christopher Powell/NY/FRS,
Betsy Gordon/NY/FRS@FRS, Jordan
Pollinger/NY/FRS@FRS, Paul H Austin/NY/FRS@FRS
Subject
UBS follow-up -- Counterparty Monitoring
In our conversation with UBS folks in London around the time of London's opening
UBS mentioned a few institutions that are concerned with.
Duplicate
BOG-- FOIA 10-251 --000661

From: Holly A Kirkpatrick
To: Danielle E Little
Subject: AIG
Date: 09/15/2008 12:50 PM
Attachments: AIG.xls
BOG-- FOIA 10-251 --000662

(b) (4)
BOG-- FOIA 10-251 --000663

From: Moses Cheng
To: Alexa Philo; Amy White; Anthony Cirillo; Arthur Angulo; Barbara Gorzkowski; Barbara Yelcich; Bard Stermasi;
Brandon Hall; Brian Peters; Bridget Habib; Caren Cox; Caroline Frawley; Catherine A Tilford; Catherine Voigts;
Chris Haley; Chris McCurdy; Christopher Calabia; Claudia Franco; Corbin Long; Coryann Stefansson; Craig F
Marchbanks; Craig Leiby; Cynthia Graves; Daniel Muccia; Denise Goodstein; Dennis Ryan; Dexter Williams;
Diane Rose; Dianne Dobbeck; Genevievette.E.Walker@frb.gov; Gretchen Cappiello; H Clay Saylor; Helen
Mucciolo; Homer Hill; Jack Jennings; James Hodgetts; James Wall; Jan Voigts; Jane Majeski; Jane Wakefield;
Jeanmarie Davis; Jeffrey Levine; Jennifer Burns; Jim Mahoney; John Beebe; John Heinze; John Reynolds; John
Ricketti; John Ruocco; Jon D Greenlee; Jonathan Polk; Joseph Galati; Judith J Gruttman; Jyoti Kohli; Kara
Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kevin Clarke; Kevin Lee; Kirsten Harlow; Kyle Grieser; Lance
Auer; Larry Bonnemere; Laura A Macedo; Laxmi Rao; Lily Tham; Linda Rodriguez; Lisa A White; Lisa Joniaux;
Lucinda M Brickler; Lydia Tshulos; Marilyn Arbuthnott; Mark Scapp; Mayra Gonzalez; Michael Johnson; Myron L
Kwast; Pamela S Powell; Pat Soriano; Patrick M Parkinson; Patrick Roche; Philip Aquilino; Ralph Santasiero;
Richard Naylor; Richard Roberts; Richard Westerkamp; Rick Weaver; Robert Gutierrez; Roger Graham; Ronald
Stroz; Sandy Krieger; Sara Mahmoud; Sarah Dahlgren; Stacy.L.Coleman@rich.frb.org; Stanley Poszywak;
Stephanie Chaly; Steven J Manzari; Steven Mirsky; Susan G Ballinger; Terry Muckleroy; Theodore Lubke;
Theonilla Lee-Chan; Theresa Barry; Thomas J O'Keeffe; Tim.P.Clark@frb.gov; Todd Waszkelewicz; Wendy Ng;
William BRODOWS; William Hallacy; Wing Oon
Cc: Richard Kunen; Pat Soriano; John Harvey; Taitu Wondwosen; Paula Premo; Peter DeMontravel; Om Arya; Jane
Wakefield; Jordan Pollinger
Subject: DB September 15, 2008 Credit Risk Management Morning Update
Date: 09/15/2008 01:03 PM
**Restricted FR**
Prepared by Moses Cheng and Tai Wondwosen
Brief Update on Credit with CRM for DB:

(b)(4) & (b)(8)
*************************************
Moses Cheng, CFA, FRM
212-720-1433
BOG-- FOIA 10-251 --000664

212-250-6075
BOG-- FOIA 10-251 --000665

From: Patrick E McCabe
To: Patrick Dwyer
Subject: Money fund issues
Date: 09/15/2008 01:05 PM
Patrick:
Just got a note from (b) (4) , who's concerned about MMF exposure to
AIG and Lehman -- not for (4) , but for others. Have you heard any word about
(b)
MMFs with NAV problems?
-Patrick
BOG-- FOIA 10-251 --000666

To: Jon D Greenlee
Cc: Adrienne Haden; Nina Nichols; Sabeth I Siddique
Subject: Brainstorming meeting
Date: 09/15/2008 01:05 PM
Listened on the NY call, they seem to have a pretty comprehensive effort underway -
split into several streams including:
(b) (5)
That's all for now.

Adrian, Nina, sabeth - feel free to correct me if I got anything wrong or missed
something.
Jim Embersit
office - 202-452-5249
cell-202-528-7884
-Jim Embersit
202-452-5249
-------------------------
BOG-- FOIA 10-251 --000667

BOG-- FOIA 10-251 --000668

From: Dianne Dobbeck
To: Patricia Mosser; Hayley Boesky; Lance Auer; Christopher Calabia; Elise Liebers; Alexander J Psomas; Steven J
Manzari; Jonathan Polk; Clinton Lively; Anthony Cirillo; Tobias Adrian; Gerard Dages; Richard Charlton; Richard
Cahill; Steven Mirsky; Kyle Grieser; William Hallacy; Bard Stermasi; Paul Whynott; Catherine Voigts; Alejandro
LaTorre; Beverly Hirtle; Til Schuermann; Judith J Gruttman; Wing.Oon@ny.frb.org; Kevin Clarke; Jennifer L.
Hicks; Wilma Sabado; Jennifer Brett; Summer Cole; Jon D Greenlee; James Embersit; Sabeth I Siddique;
Coryann Stefansson; Kevin Coffey
Cc: Arthur Angulo; Sarah Dahlgren; Meg McConnell; Adam Ashcraft
Subject: AIG & Identifying other firms under stress
Date: 09/15/2008 01:08 PM
As a follow-up to our discussion this morning, below is a quick outline for moving
forward. For those of you that were not able to attend the meeting due to
scheduling conflicts, we spoke about three efforts -- the most immediate of which
relate to dimensioning risks posed by AIG. The other two streams are intended to
(a) identify other non-bank intermediaries of potential concern, and (b) potential
weaknesses at banks (with emphasis on regional and smaller foreigns). The points
for each stream are identified below. Additionally, we'll look to have a preliminary
view on all three workstreams toward the end of today with analysis to continue
throughout the week.
(b) (5)
BOG-- FOIA 10-251 --000669

Subject: Fw: AIG gets New York's help in accessing $20 billion
Date: 09/15/2008 01:23 PM
In case you haven't seen this.
Jon Greenlee
Associate Director
Phone (202) 452-2962
Diane
Fraser/BOARD/FRS
To Jon D Greenlee/BOARD/FRS@BOARD, Adrienne
Haden/BOARD/FRS@BOARD, James
09/15/2008 01:20 PM Nichols/BOARD/FRS, Sabeth I
Siddique/BOARD/FRS@BOARD
cc Diane.Fraser@frb.gov, Elise Liebers/NY/FRS@FRS
Subject AIG gets New York's help in accessing $20 billion
Business Insurance
AIG gets New York's help in accessing $20 billion
Sept. 15, 2008
NEW YORK (Reuters)—New York Gov. David Paterson said he and other state officials
had reached an agreement with American International Group Inc that allows the insurer
access to $20 billion of its own capital, staving off a liquidity crisis.
Under the plan, AIG will be able to shift the funds from its insurance subsidiaries to the
parent company.
AIG had worked with New York officials through the weekend to shore up capital after
rating agencies threatened downgrades. AIG's shares were down 55.6% at $5.39 after
earlier touching $3.50.
The company has posted $18 billion in cumulative losses over the past three quarters on
guarantees it wrote on mortgage-linked securities.
Gov. Paterson said he had worked with AIG in a bid to help save New York jobs, with the
BOG-- FOIA 10-251 --000670

insurer employing 6,000 in Manhattan and 8,600 statewide. He added that the plan was
carefully crafted to pose no risk to New York taxpayers.
New York Insurance Superintendent Eric Dinallo is appealing to the federal government on
AIG's behalf to provide it additional access to capital, Gov. Paterson said.
BOG-- FOIA 10-251 --000671

From: Danielle E Little
To: Jeffrey Marquardt; RBOPS PAYMENT SYSTEM RISK; Jeff Stehm
Subject: AIG FSB information
Date: 09/15/2008 01:32 PM
AIG FSB 20080912.pdf
Good afternoon,
Please find attached an Excel worksheet with attribute data of AIG's federal savings
bank (AIG FSB) including cap class, asset, collateral, and overdrafting information.
(b) (4)
Also, please find attached an intraday balance report for AIG FSB.
Please let me know if you have any questions or would like additional information.
Thanks,
Danielle
Danielle Little
Federal Reserve Board
202.452.2605
danielle.e.little@frb.gov
BOG-- FOIA 10-251 --000672

(b) (4)
BOG-- FOIA 10-251 --000673

(b) (4)
BOG-- FOIA 10-251 --000674

From: (b) (4)
Subject: Well lets see what we have here
Date: 09/15/2008 01:37 PM
Market reacted better so far--but much of what we saw today was clients
coming to us to deal with re-assignment of trades they had on with
Lehman. Process is going forward---see below as I find this
amazing--why does the FED need Morgan Stanley to assess options in the
case of AIG--why not have US FED personnel work with Dinallo and co?
What am I missing here?
Why does Paulson have such a large role--what can I say
I hope you get sleep as I hardly ever do these days--but I think the
action taken personally was the right one.
(b)
(4)
13:24 15Sep08 RTRS-MORGAN STANLEY <MS.N> HIRED BY FEDERAL RESERVE TO
REVIEW OPTIONS REGARDING AIG <AIG.N> - SOURCE
13:25 15Sep08 RTRS-MORGAN STANLEY <MS.N> WILL REVIEW FED'S OPTIONS, WHAT
SYSTEMIC RISK FROM AIG AIG.N> - SOURCE
13:26 15Sep08 RTRS-RPT-MORGAN STANLEY <MS.N> WILL REVIEW FED'S OPTIONS,
WHAT SYSTEMIC RISK FROM AIG <AIG.N> - SOURCE
For Related News, Double Click on one of these codes:

[E] [U] [C] [D] [M] [O] [T] [MTL] [GRO] [SOF] [OIL] [NAT] [US] [BSVC]
[FINS] [INVS] [FIN] [FUND] [MRG] [BNK] [PVE] [REGS] [USC] [DBT] [MTG]
[INSR] [MINS] [INS] [LEN] [RTRS] [MS.N] [AIG.N]
For Relevant Price Information, Double Click on one of these codes:

<MS.N> <AIG.N>
Monday, 15 September 2008 13:24:13

RTRS [nWEN8079] {EN}
ENDS
(b) (4)
BOG-- FOIA 10-251 --000675

From: John Harvey
To: NY Bank Sup - LFI CPC Updates@FRS
Cc: Christopher Hunter
Subject: DB Clearing & Settlement update #3 - Final or today (9/15/08)
Date: 09/15/2008 01:45 PM
Please note the following update from Tom Devine, Director – Global Markets at 8:45
am.
(b)(4) & (b)(8)
Our next meeting with Mr. Devine will be tomorrow morning at 7am.
BOG-- FOIA 10-251 --000676

To: Patrick M Parkinson; JNellie Liang; Daniel M Covitz
Subject: Fw: CP Market Update:
Date: 09/15/2008 01:51 PM
(b) (4)
To <gustavo.a.suarez@frb.gov>,
09/15/2008 01:45 PM <Chris.Burke@ny.frb.org>
cc
Subject CP Market Update:
This was not a good day for CP. Liquidity was very poor. Think investor
parking in Tbills and Treasuries, we only saw half the normal flows. Very tough
gauging levels for issuer, traded between 1.5% an 8%. Bottom Line very very
difficult market conditions today in CP and in Repo for RP outside Govt
Collateral. Spent my morning fending off many many buyback bids wanted
from investors on GECC CP and Aig CP.
(b) (4)
BOG-- FOIA 10-251 --000677

To: BSR.LCBO.Management.Group@frb.gov
Cc: BSR LIG; Betsy Cross
Subject: Leh, aig etc
Date: 09/15/2008 02:16 PM
Please keep an eye out for (b)(5)&(b)(8)
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
BOG-- FOIA 10-251 --000678

To: Brian Peters; Betsy Cross; Kevin Bertsch
Cc: Sarah Dahlgren
Subject: Re: Fw: AIG & Identifying other firms under stress
Date: 09/15/2008 02:20 PM
I think the risk report can inform you regarding the exposures within the portfolio
and I know that we are doing liquidity monitoring across the board (b)(5)&(b)(8)
We will let you know if there is a problem
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # 202 294 9829
▼ Brian Peters

From: Brian Peters
Sent: 09/15/2008 01:40 PM EDT
To: Coryann Stefansson; Betsy Cross; Kevin Bertsch
Cc: Sarah Dahlgren
Cory, Betsy, Kevin,
please add Sarah and I to the email workstream summarizing the
Regional work. Sarah and I need to be able to keep our principals
informed of developments as well - we will work to avoid duplication
too. thanks...bp
Duplicate
BOG-- FOIA 10-251 --000679

From: Adrienne Haden
To: Diane Fraser; Barbara Cornyn
Subject: Fw: Brainstorming meeting
Date: 09/15/2008 02:24 PM
FYI.
Adrienne Haden
Assistant Director
Banking Supervision and Regulation
(202)452-2058 Office
(202)528-7892 Mobile
----- Forwarded by Adrienne Haden/BOARD/FRS on 09/15/2008 02:23 PM -----
James.Embersit@frb.gov
cc "Adrienne Haden" <Adrienne.Haden@frb.gov>,
09/15/2008 01:05 PM "Nina Nichols" <Nina.Nichols@frb.gov>,
Sabeth.I.Siddique@frb.gov
Subject Brainstorming meeting
Listened on the NY call, they seem to have a pretty comprehensive effort

underway - split into several streams including:
Duplicate
BOG-- FOIA 10-251 --000680

From: Chris.Haley@bos.frb.org
To: Coryann.Stefansson@frb.gov; BSR.LCBO.Management.Group@frb.gov
Cc: BSR LIG; Betsy.Cross@frb.gov; Rhonda Kelley; Jim Nolan
Subject: Re: Leh, aig etc
Date: 09/15/2008 02:40 PM
(b)(4) & (b)(8)
Chris
--------------------------

From: Coryann.Stefansson
Sent: 09/15/2008 02:16 PM AST
To: "BSR.LCBO.Management.Group@frb.gov" <BSR.LCBO.Management.Group@frb.gov>
Cc: BSR.LIG@frbog.frb.gov; Betsy Cross
Subject: Leh, aig etc
Duplicate
BOG-- FOIA 10-251 --000681

To: Maria.G.Perozek@frb.gov
Subject: info on AIG & other info
Date: 09/15/2008 02:56 PM
By broad line of business, AIG’s revenues break down as follows:

Property casualty operations: 42%
Life insurance operations: 46%
Financial products: 8%
Asset management: 4%
In general, state insurance statutes allow commercial insurance underwriters to pay out a
maximum dividend amount of the greater of (1) the prior year-end net income, or (2) 10% of
the surplus as regards policyholders, without the approval of the state’s insurance regulatory
authority. State insurance regulatory authorities have the power to approve extraordinary
dividends on a case-by-case basis.
http://www.forbes.com/business/2008/09/15/insurance-aig-new-york-biz-wall-
cx_lm_0915aigupdate.html
BOG-- FOIA 10-251 --000682

From: BSR FBO, BD. OF GOV. OF FED.
To: jill.k.cetina@frb.gov
Subject: (BN) Morgan Stanley, Goldman Bonds Drop as Bank Default Risk Surges
Date: 09/15/2008 03:01 PM
+---------------------------------------------------------------------------
---+
Morgan Stanley, Goldman Bonds Drop as Bank Default Risk Surges

2008-09-15 17:21:58.140 GMT
By Abigail Moses and Bryan Keogh

Sept. 15 (Bloomberg) -- Morgan Stanley and Goldman Sachs
Group Inc. led a record surge in the cost of default protection
and a slump in bank bond prices after Lehman Brothers Holdings
Inc. filed for bankruptcy.
Credit-default swaps on Morgan Stanley soared to a record
and the New York-based firm's senior notes fell the most since
they were sold six month ago. Goldman's senior notes plummeted to
a record low and the cost of protecting its bonds against default
rose to an all-time high. Sellers were demanding upfront payments
for protecting American International Group Inc. and Washington
Mutual Inc. on rising concern that they would default.
Investor speculation that Lehman's bankruptcy may trigger
further takeovers or mergers roiled credit markets after the
Treasury and the Federal Reserve declined to rescue Lehman, as
they did in March with Bear Stearns Cos. Merrill Lynch & Co.
agreed to be bought by Bank of America Corp. as the credit crisis
threatened the global financial industry.
Goldman and Morgan Stanley, the two remaining major Wall
Street investment banks, ``made the same mistakes'' as Merrill
and Lehman, and `ànybody in that business is at risk,'' said
Gregory Habeeb, a portfolio manager at Calvert Asset Management
Co. in Bethesda, Maryland.
``The dangers have intensified,'' said Habeeb, who manages
$8.5 billion in fixed-income assets and doesn't own Lehman bonds.
`` There was a lesson of Bear Stearns and apparently Lehman
didn't learn it. The lesson at Bear Stearns and Lehman may have
precipitated Merrill to do something.''
Upfront Payments
Credit-default swaps on Morgan Stanley soared 189 basis

points to 453 and its senior notes now yield more than a typical
bond rated BB, or seven grades lower. Contracts on Goldman jumped
119 basis points to 318 basis points. Credit default swaps on
Merrill, the world's biggest brokerage firm, dropped after it
agreed to the Bank of America purchase.
Increased credit-market turmoil is forcing 17 financial
companies' credit-default swaps to trade upfront, meaning those
seeking protection must make an initial payment as well as
premiums, signaling rising default concern, according to CMA
Datavision.
Sellers demanded 47 percentage points upfront and 5
percentage points a year to protect the bonds of Washington
Mutual from default on concern that the biggest U.S. savings and
loan won't survive the credit crisis, according to CMA Datavision
prices in New York. That compares with an upfront cost of 40
percentage points on Sept. 12 and means it would cost $5 million
initially and $500,000 a year to protect $10 million in bonds for
five years.
AIG Bonds
The upfront cost to protect AIG bonds from default soared

16.5 percentage points to 29 percentage points after earlier
rising to 34 percentage points, CMA data show. The insurer's 5.85
BOG-- FOIA 10-251 --000683

percent notes due in 2018 fell 11.3 cents to 58.3 cents on the
dollar to yield 14 percent, according to Trace, the Financial
Industry Regulatory Authority's bond-pricing service.
The U.S. government's decision not to bail out Lehman
reduces the ``moral hazard'' introduced when Bear Stearns was
rescued and the Bank of England nationalized mortgage lender
Northern Rock Plc, according to Juan Esteban Valencia, a credit
strategist at Societe Generale SA in London.
``The get-out-of-jail-free card turned out not to be worth
what they thought,'' said Matt King, head of quantitative credit
strategy at Citigroup Inc. in London. ``This makes it much, much
harder for financial institutions to get the financing they
need.''
Contracts on Wachovia Corp., the fourth-biggest U.S. bank,
surged 129 basis points to 582 and JPMorgan Chase & Co. rose 42
to 185, CMA data show. Merrill dropped 139 basis points to 319
basis points. Bank of America increased 53 basis points to 212.
Morgan Stanley Notes
Morgan Stanley's 6.625 percent senior unsecured notes due in

2018 fell 9.3 cents to 82.9 cents on the dollar for a yield of
9.4 percent, according to Trace. Debt rated BB on average yields
9.1 percent, according to Merrill's U.S. High-Yield BB Rated
index. Morgan Stanley's notes are rated A1 by Moody's Investors
Service and A+ by Standard & Poor's.
Goldman's 6.15 percent notes due in 2018 dropped 7.3 cents
to 88.3 cents on the dollar to yield 7.9 percent, Trace data
show. The New York-based securities firm's 6.35 percent bonds due
in 2034 fell 10.6 cents to 71.7 cents on the dollar, for a yield
of 9.3 percent.
In Europe, HSBC Holdings Plc, Europe's biggest bank, and
Barclays Plc led a jump in the cost of default protection,
driving the benchmark Markit iTraxx Financial index of 25 banks
and insurers a record 32 basis points higher to 127, according to
JPMorgan.
HSBC, Barclays
The Markit CDX North America Investment Grade Index, linked

to the bonds of 125 companies in the U.S. and Canada, rose 35.5
basis points to 186.5 as of 1:01 p.m., according to broker
Phoenix Partners Group. Earlier they traded as high as 190 basis
points.
Credit-default swaps on London based HSBC soared 22 basis
points to 93, the most ever, according to CMA Datavision prices
in London. Barclays, the U.K.'s third-biggest bank, rose 34 to
166, Zurich-based UBS AG jumped 28 to 164 and Spain's Banco
Santander surged 22 to 122.
Credit-default swaps, contracts conceived to protect
bondholders against default, pay the buyer face value in exchange
for the underlying securities or the cash equivalent should a
company fail to adhere to its debt agreements. A rise indicates
deterioration in the perception of credit quality; a decline
signals the opposite.
A basis point on a credit-default swap contract protecting
$10 million of debt from default for five years is equivalent to
$1,000 a year.
--With reporting by Caroline Salas and Shannon D. Harrington in

New York. Editor: Michael Shanahan, John Pickering
To contact the reporter on this story:

Abigail Moses in London +44-2-7673-2118 or
Amoses5@bloomberg.net
To contact the editor responsible for this story:

Gavin Serkin at +44 207 673 2467 or
gserkin@bloomberg.net.
BOG-- FOIA 10-251 --000684

From: Jennifer Burns
Subject: Fw: Leh, aig etc
Date: 09/15/2008 03:14 PM
Attachments: Lehman20080909.xls
Evergreen Statement on Lehman Exposure 9-15-2008.pdf
Bill Dawson 9-15-2008 Lehman.doc
Jennifer Joseph Burns

Office 704· 358· 2550 · Cell 704· 287· 2813
jennifer.burns@rich.frb.org
www.richmondfed.org
----- Forwarded by Jennifer Burns/RICH/FRS on 09/15/2008 03:13 PM -----
Jeremy
Carter/RICH/FRS
To Jennifer Burns/RICH/FRS@FRS
cc Lisa A White/RICH/FRS@FRS, Richard
Westerkamp/RICH/FRS@FRS
09/15/2008 02:51 PM
Subject
Re: Fw: Leh, aig etc
Jennifer,
Not Responsive
We are also working on AIG exposure and I have been notified that (b)(4) & (b)
(8)
Please let me know if you have further questions.
Jeremy
Not Responsive
BOG-- FOIA 10-251 --000685

Jeremy J Carter
Banking Supervision and Regulation/Large Complex Bank Organizations
Office 704· 358· 2584 · Cell 704· 281· 8224
jeremy.carter@rich.frb.org
www.richmondfed.org
▼ Jennifer Burns/RICH/FRS
Jennifer
Burns/RICH/FRS
To Richard Westerkamp/RICH/FRS@FRS, Jeremy
Carter/RICH/FRS, Lisa A White/RICH/FRS@FRS
cc
09/15/2008 02:28 PM
Subject Fw: Leh, aig etc
FYI - Rich you mentioned that this was on Wachovia's radar screen yesterday.
Jennifer Joseph Burns

Office 704· 358· 2550 · Cell 704· 287· 2813
jennifer.burns@rich.frb.org
www.richmondfed.org
----- Forwarded by Jennifer Burns/RICH/FRS on 09/15/2008 02:24 PM -----
Coryann.Stefansson@frb.gov
To "BSR.LCBO.Management.Group@frb.gov"
<BSR.LCBO.Management.Group@frb.gov>
09/15/2008 02:20 PM cc BSR.LIG@frbog.frb.gov, "Betsy Cross"
<Betsy.Cross@frb.gov>
Subject Leh, aig etc
Duplicate
BOG-- FOIA 10-251 --000686

BOG-- FOIA 10-251 --000687
Not Responsive
BOG-- FOIA 10-251 --000688

Not Responsive
BOG-- FOIA 10-251 --000689

Not Responsive
BOG-- FOIA 10-251 --000690

Not Responsive
BOG-- FOIA 10-251 --000691

Not Responsive
BOG-- FOIA 10-251 --000692

Not Responsive
BOG-- FOIA 10-251 --000693

Not Responsive
BOG-- FOIA 10-251 --000694

Not Responsive
BOG-- FOIA 10-251 --000695

Not Responsive
BOG-- FOIA 10-251 --000696

Not Responsive
BOG-- FOIA 10-251 --000697

Not Responsive
BOG-- FOIA 10-251 --000698

Not Responsive
BOG-- FOIA 10-251 --000699

Not Responsive
BOG-- FOIA 10-251 --000700

From: Scott Alvarez
Subject: AIG memo
Date: 09/15/2008 03:20 PM
Importance: High
Bill,
I'd also send it to the Vice Chair.
Scott
BOG-- FOIA 10-251 --000701

To: Brian F Madigan
Subject: aig memo
Date: 09/15/2008 03:22 PM
Office: 202-452-3579
Mobile: 703-340-4542
BOG-- FOIA 10-251 --000702

(b) (5)
BOG-- FOIA 10-251 --000703

(b) (5)
BOG-- FOIA 10-251 --000704

(b) (5)
BOG-- FOIA 10-251 --000705

(b) (5)
BOG-- FOIA 10-251 --000706

(b) (5)
BOG-- FOIA 10-251 --000707

DRAFT -6-
BOG-- FOIA 10-251 --000708

DRAFT -7-
(b) (5)
BOG-- FOIA 10-251 --000709

DRAFT -8-
(b) (5)
BOG-- FOIA 10-251 --000710

DRAFT -9-
(b) (5)
BOG-- FOIA 10-251 --000711

DRAFT - 10 -
(b) (5)
BOG-- FOIA 10-251 --000712

DRAFT - 11 -
(b) (5)
BOG-- FOIA 10-251 --000713

DRAFT - 12 -
(b) (5)
BOG-- FOIA 10-251 --000714

DRAFT - 13 -
(b) (5)
BOG-- FOIA 10-251 --000715

To: Brian F Madigan
Subject: Fw: AIG memo
Date: 09/15/2008 03:23 PM
Office: 202-452-3579
Mobile: 703-340-4542
Scott
Alvarez/BOARD/FRS
cc
09/15/2008 03:20 PM Subject AIG memo
Bill,
I'd also send it to the Vice Chair.
Scott
BOG-- FOIA 10-251 --000716

From: David W Skidmore
To: Michelle A Smith; Calvin Mitchell; Andrew Williams
Subject: from wsj.com re AIG
Date: 09/15/2008 03:46 PM
What do we know about this? What are we saying?
"Federal government asks Goldman, J.P. Morgan Chase to lead $70 billion-$75
billion lending facility for AIG. Full update to follow. "
BOG-- FOIA 10-251 --000717

To: David W Skidmore
Cc: Andrew Williams; Calvin Mitchell
Subject: Re: from wsj.com re AIG
Date: 09/15/2008 03:48 PM
I just talked with calvin about it. he will call us back.

▼ David W Skidmore/BOARD/FRS
Duplicate
BOG-- FOIA 10-251 --000718

From: Thomas J O'Keeffe
To: Alejandro LaTorre; Alexa Philo; Amy White; Andrew Small; Anthony Cirillo; Arthur Angulo; Barbara Gorzkowski;
Barbara Yelcich; Bard Stermasi; Brandon Hall; Brian Peters; Caren Cox; Caroline Frawley; Caroline Nuffort;
Catherine A Tilford; Catherine Voigts; Chris Haley; Chris McCurdy; Christina Zausner; Christopher Calabia;
Christopher Powell; Claudia Franco; Clinton Lively; Corbin Long; Coryann Stefansson; Craig F Marchbanks;
Craig Leiby; Cynthia Graves; Daniel Muccia; Daniel Sullivan; Deborah Lohnau; Deborah P Bailey; Denise
Goodstein; Dennis Herbst; Dennis Ryan; Dianne Dobbeck; Dmitry J Gershik; Elizabeth Gress; Elizabeth Tafone;
Gail Santora; Genevievette.E.Walker@frb.gov; Gerard Dages; Glen Reppy; Gretchen Cappiello; Gretchen
Walker; H Clay Saylor; Hasan Latif; Hayley Boesky; Homer Hill; Isabella Lo Piccolo; Jack Jennings; James
Embersit; James Hodgetts; James Wall; Jan Voigts; Jane Green; Jane Majeski; Jane Wakefield; Jeanmarie
Davis; Jeffrey Kowalak; Jeffrey Levine; Jeffrey Plaskett; Jim Mahoney; Joanna Wisniecka; John Beebe; John
Heinze; John Reynolds; John Ricketti; John Ruocco; Jon D Greenlee; Jonathan Polk; Joseph Galati; Judith J
Gruttman; Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kenton Beerman; Kerry STREETS; Kevin
Clarke; Kevin Coffey; Kevin Lee; Kevin Littler; Kirsten Harlow; Kyle Grieser; Lance Auer; Larry Bonnemere;
Laura A Macedo; Lawrence ROSTOKER; Laxmi Rao; Lily Tham; Linda Rodriguez; Lisa A White; Lisa Joniaux;
Lucinda M Brickler; Lydia Tshulos; Mark Scapp; Meg McConnell; Meinrad Danzer; Michael Johnson; Myron L
Kwast; Bin Lang; Brian Hefferle; Caroline Nuffort; Isabella Lo Piccolo; Joanna Wisniecka; Joshua Sherwin;
Kathryn Chen; Kenton Beerman; Mayra Gonzalez; Randolph Brown; Susan G Ballinger; Susan Goldberg;
Thomas J O'Keeffe; Pamela S Powell; Pat Soriano; Patrick M Parkinson; Patrick Roche; Philip Aquilino; Ralph
Santasiero; Randolph Brown; Renuka Vijayanathan; Richard Heeseler; Richard Kunen; Richard Naylor; Richard
Roberts; Richard Westerkamp; Rick Weaver; Robert D Patalano; Robert Gutierrez; Roberto Perli; Roger
Graham; Rohit Bansal; Ron Fox; Ronald Stroz; Sandy Krieger; Sara Mahmoud; Sarah Dahlgren;
Stacy.L.Coleman@rich.frb.org; Stanley Poszywak; Stephanie Chaly; Steven Friedman; Steven J Manzari; Steven
Mirsky; Susan G Ballinger; Susan Goldberg; Terrence Checki; Theodore Lubke; Theonilla Lee-Chan; Theresa
Barry; Thomas Dolan; Thomas J O'Keeffe; Tim.P.Clark@frb.gov; Todd Waszkelewicz; Wendy Ng; William B
English; William BRODOWS; William Rutledge; Wing Oon; Alexa Philo; Ann Miner; Barbara Yelcich; Betsy
Gordon; Caroline Frawley; Catherine Voigts; Che Sidanius; Christopher Hunter; Claudia Franco; Clinton Lively;
Deborah Lohnau; Denise Goodstein; Dennis Ryan; Dianne Dobbeck; Glen Reppy; Gregory Gaare; Jacqueline
Lovisa; James DeFalco; James Wall; Jane Wakefield; Jeanmarie Davis; Jim Mahoney; John Harvey; John
Reynolds; John Ricketti; John Ruocco; Karen Kahrs; Lisa Joniaux; Lydia Tshulos; Mark Scapp; Patrick Roche;
Peter Drake; Ralph Santasiero; Randolph Brown; Richard Cahill; Sara Mahmoud; Sarah Dahlgren; Stephanie
Chaly; Steven J Manzari; Steven Mirsky; Susan Goldberg; Timothy Carlin; Todd Waszkelewicz; Yogesh Shah
Cc: Bin Lang; Brian Hefferle; Caroline Nuffort; Isabella Lo Piccolo; Joanna Wisniecka; Joshua Sherwin; Kathryn
Chen; Kenton Beerman; Mayra Gonzalez; Randolph Brown; Susan G Ballinger; Susan Goldberg; Thomas J
O'Keeffe
Subject: Afternoon Liquidity Team Update
Date: 09/15/2008 03:53 PM
Importance: High
Restricted F.R.
Not Responsive
BOG-- FOIA 10-251 --000719

Not Responsive
6. Money Funds – Not Responsive
(b) (4)
noted
Reserve Funds had a large amount of Lehman and AIG exposure and will
probably ‘break the buck’ and need to be acquired by an outside party.
Not Responsive
************************************************
Bank Supervision
(212)720-5568
***********************************************
BOG-- FOIA 10-251 --000720

From: Susan V Foley
To: Jeffrey Marquardt; Jeff Stehm; RBOPS PAYMENT SYSTEM RISK
Subject: Fw: AIG FSB information--Update
Date: 09/15/2008 04:07 PM
Spoke to Philly.
AIG FSB is at a zero cap (no collateral) on the real time monitor. The FSB was
notified and was fine with the zero cap--they have very low levels of DLOD (average
about $5,000). The FSB does have OC 10 documents on file. It appears that the
FSB is fairly insulated from the affiliates/parent; had been more interactions in the
past but less so today.
Not Responsive
In both cases, Philly indicated to the FSBs that the 23A exemption just announced
would not apply to them. (thoughts?)
Philly will be circulating a memo shortly with this and other information. I will
forward when I receive.
Susan Foley
Assistant Director
Payment System Risk
(202) 452-3596
----- Forwarded by Susan V Foley/BOARD/FRS on 09/15/2008 03:54 PM -----
Danielle E
Little/BOARD/FRS
To Jeffrey Marquardt/BOARD/FRS@BOARD, RBOPS
PAYMENT SYSTEM RISK, Jeff
09/15/2008 01:32 PM cc
Subject AIG FSB information
Duplicate
BOG-- FOIA 10-251 --000721

From: Cynthia L Martin
To: Elise Liebers; Diane Fraser
Cc: Kimberly A DeTrask; Patrick deFontnouvelle; Cynthia L Bordelon; Bart Simon
Subject: Lending facility for AIG proposed today
Date: 09/15/2008 04:10 PM
Bank, Broker/Dealer & Insurance Underwriter - Operations and Strategy

Report: Feds asking i-bank support for potential AIG options
September 15, 2008 3:57 PM ET
By Thomas Mason
The U.S. government has requested JPMorgan Chase & Co. and Goldman Sachs Group
Inc. lead a lending facility for American International Group Inc. to the tune of $70 billion
to $75 billion, The Wall Street Journal reported in a posting to its Web site on Sept. 15.
Meanwhile, the New York Times' DealBook blog reported in a posting at 1:56 p.m. Eastern
time that the Federal Reserve has hired Morgan Stanley for advice on potential options to
support the insurance behemoth. The Times said aid could include a $20 billion bridge loan.
Earlier, Treasury Secretary Henry Paulson denied that the federal government would
provide a bridge loan.
"What's going on in New York has got nothing to do with any bridge loan from the
government," Paulson said at a Sept. 15 press conference. "What's going on in New York is
a private-sector effort."

Usage of this product is governed by the Master Subscription Agreement
Cynthia Martin
600 Atlantic Avenue
Boston, MA 02210
617 973-3178 (office)

617 619-8478 (fax)
BOG-- FOIA 10-251 --000722

From: Jeffrey Levine
Cc: Theonilla Lee-Chan; Barbara Yelcich; Gregory Gaare; Laura Braverman; Jennifer Tranter; Erin Upton; Edgar
Moreano; Christopher Hunter; Antonino Piscitello; James DeFalco; Liska Holness; Benjamin Eddy
Subject: JPMC: Liquidity Update from afternoon meeting with Treasury
Date: 09/15/2008 04:11 PM
**Strictly Confidential - F.R. Material**
All,
Below are some highlights from this afternoon's call with JPMC's Treasury.
Jeff
(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000723

(b) (4) and (b) (8)
(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000724

To: Michelle A Smith; David W Skidmore
Cc: Andrew Williams
Date: 09/15/2008 04:11 PM
This is not true. JPMC and GS are working on behalf of AIG to come up with
significant funding.
(JPMC has been hired by AIG to help it explore possibilities. And Goldman represents
potential principal investors.)
We are convening the parties to assist their discussions.
Duplicate
BOG-- FOIA 10-251 --000725

From: Alejandro.LaTorre@ny.frb.org
To: Christopher.Calabia@ny.frb.org; Patricia.Mosser@ny.frb.org; Michael Gibson; Jon Greenlee; Richard Charlton;
Jonathan Polk; Azish Filabi
Cc: NY Banksup AIG Monitoring and Analysis@glc.frb.org
Subject: Re: please get a new dial in for the call with the insurance department...
Date: 09/15/2008 04:13 PM
I will send out a new line and send to hampton.


Sent: 09/15/2008 04:13 PM EDT
To: Patricia Mosser; Alejandro LaTorre
Cc: NY Banksup AIG Monitoring and Analysis
Subject: please get a new dial in for the call with the insurance
(b) (5)
...and if you get the package they were discussing, could you pass it
along?
BOG-- FOIA 10-251 --000726

To: Calvin Mitchell
Date: 09/15/2008 04:13 PM
You telling people that?

▼ Calvin Mitchell
Duplicate
BOG-- FOIA 10-251 --000727

Date: 09/15/2008 04:15 PM
Yup
▼ Michelle A Smith
Duplicate
BOG-- FOIA 10-251 --000728

To: Adam Ashcraft; Alejandro LaTorre; Alexa Philo; Alexander J Psomas; Azish Filabi; Bard Stermasi; Brian Begalle;
Catherine Voigts; Christopher Calabia; Danielle Vicente; Denise Goodstein; Dianne Dobbeck; Elise Liebers; Erika
Gottfried; Gerard Dages; Jim Mahoney; Jonathan Polk; Kevin Coffey; Mari Baca; Mark Scapp; Min Kim; Niall E
Coffey; Patricia Mosser; Paul Whynott; Richard Charlton; Tobias Adrian; Zoltan Pozsar; Michael S Gibson; Jon D
Greenlee
Subject: AIG info
Date: 09/15/2008 04:15 PM
Attachments: Scan001.pdf
----- Forwarded by Patricia Mosser/NY/FRS on 09/15/2008 04:14 PM -----
"Swift, Christopher"
<Christopher.Swift@aig.com>
To "'HFiner@ins.state.ny.us'"
Sent by: "Turco, Antonia"
<HFiner@ins.state.ny.us>, Patricia Mosser
<Antonia.Turco@aig.com>
<Patricia.Mosser@ny.frb.org>,
EDinallo@ins.state.ny.us
cc JKenny@ins.state.ny.us,
KBrooks@ins.state.ny.us, Joseph Fritsch
09/15/2008 03:11 PM <JFritsch@ins.state.ny.us>,
MMoriart@ins.state.ny.us, Robert Easton
<REaston@ins.state.ny.us>, Dennis Fernez
<DFernez@ins.state.ny.us>, "Swift,
Christopher" <Christopher.Swift@aig.com>
Subject RE: contacts
Please see attached materials for this call.

CS

Best Regards,
Toni Turco on behalf of Chris Swift
Executive Assistant to Christopher Swift
Vice President and Chief Financial Officer
AIG Life and Retirement Services
70 Pine Street - 17th Floor
Tel: 212-770-5286 / Fax: 212-770-7620
From: HFiner@ins.state.ny.us [mailto:HFiner@ins.state.ny.us]
Sent: Monday, September 15, 2008 3:05 PM
To: Patricia Mosser; EDinallo@ins.state.ny.us
Cc: JKenny@ins.state.ny.us; KBrooks@ins.state.ny.us; Joseph Fritsch;
MMoriart@ins.state.ny.us; Robert Easton; Dennis Fernez; Swift, Christopher
Subject: Re: contacts
BOG-- FOIA 10-251 --000729

We'll be on momentarily.
From: Patricia.Mosser
Sent: 09/15/2008 03:05 PM AST
To: Hampton Finer; Eric Dinallo
Cc: John Kenny; Kermitt Brooks
Yes thanks.
-----------------------------
From: HFiner
Sent: 09/15/2008 02:12 PM AST
To: Patricia Mosser; EDinallo@ins.state.ny.us
Cc: JKenny@ins.state.ny.us; KBrooks@ins.state.ny.us
I'm trying to line up the ceo of the agc life holding company and the p&c leadership to
answer our questions.
We can talk internally afterwards
Does this work for you trish?
Sent: 09/15/2008 01:42 PM AST
To: Eric Dinallo
Cc: Hampton Finer; John Kenny; Kermitt Brooks
If 3 pm still works for all of you, here is a dial in number to use.
BOG-- FOIA 10-251 --000730

USA Toll-Free: (877)322-9654
* USA Caller Paid/International Toll: (954)797-1657
* HOST CODE: 992750
* PARTICIPANT CODE: 757558
Thanks
Trish
To "Patricia Mosser" <Patricia.Mosser@ny.frb.org>

09/15/2008 12:53 PM
cc "Kermitt Brooks" <KBrooks@ins.state.ny.us>, "Hampton Finer"
<hfiner@ins.state.ny.us>, "John Kenny" <jkenny@ins.state.ny.us>
Subject Re: contacts

Sure. Kermit will call. I'm on with RAs now.
Sent: 09/15/2008 12:51 PM AST
To: Eric Dinallo
Eric,
Since you have been over here visiting Tim, perhaps we could try for a call a bit
later today -- Would 3 pm work?
Trish
BOG-- FOIA 10-251 --000731


09/15/2008 11:30 AM
cc


Sure. I'm on the way now.
Sent: 09/15/2008 11:27 AM AST
To: Eric Dinallo
Cc: Hampton Finer; John Kenny
Eric,
Would you and your team have time for a followup call with us today? We'd like to
get a sense of where you think things stand, and if possible some sense of
contingency plans for the regulated parts of the firm.
Thanks
Trish
BOG-- FOIA 10-251 --000732


09/14/2008 09:40 AM
cc "John Kenny" <jkenny@ins.state.ny.us>, "Hampton Finer"

<hfiner@ins.state.ny.us>

Ok. I'm having a team call at 10 am and then we could flip to all of you at 10:30. Do you
want to create a dial-in that we would join or you join ours? I'm cc-ing some of my group
who may have ideas.
Sent: 09/14/2008 09:12 AM AST
To: Eric Dinallo
Thanks. We have a few folks from the Board of Govs in DC who would also like to call in if
possible.
-----------------------------
From: EDinallo
Sent: 09/14/2008 08:59 AM AST
To: Patricia Mosser
BOG-- FOIA 10-251 --000733

Yes. I will set up.
Sent: 09/14/2008 08:58 AM AST
To: Eric Dinallo
Would some of your experts be available for a conference call at 10:30 this morning?
Trish
-----------------------------
From: EDinallo
Sent: 09/13/2008 06:17 PM AST
To: Patricia Mosser
Just tried yiur cell.
Sent: 09/13/2008 03:35 PM AST
To: Eric Dinallo
Eric,
What time would be convenient for a call? I can also be reached at my cell (b) (6)
If I should contact you at your office, please let me know the number.
Thanks
Trish
Patricia C. Mosser
Senior Vice President, Markets Group
BOG-- FOIA 10-251 --000734

Capital Markets Analysis and Trading
(212) 720-6416
(b) (6)
Trading desk: (212)720-6860/6880
All numbers may be also dialed with 646 area code.
William Rutledge/NY/FRS

09/13/2008 01:14 PM
To edinallo@ins.state.ny.us
cc Patricia Mosser/NY/FRS@FRS
Subject contacts

Eric:
Contact numbers: Trish 720-6416; mine 720-5268
Bill
BOG-- FOIA 10-251 --000735

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000736

(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000737

(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000738

(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000739

(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000740

From: Cynthia L Martin
Subject: Fw: FRB has hired Morgan Stanley for advice on AIG?
Date: 09/15/2008 04:16 PM
oops, didn't read this through before sending ! - second paragraph below
Cynthia Martin
600 Atlantic Avenue
Boston, MA 02210
617 973-3178 (office)

617 619-8478 (fax)
----- Forwarded by Cynthia L Martin/BOS/FRS on 09/15/2008 04:15 PM -----
Cynthia L
Martin/BOS/FRS
To Elise Liebers/NY/FRS, Diane Fraser/BOARD/FRS
cc Kimberly A DeTrask/BOS/FRS@FRS, Patrick
deFontnouvelle/BOS/FRS@FRS, Cynthia L
09/15/2008 04:13 PM Bordelon/BSR/CHI/FRS@FRS, Bart
Simon/BOS/FRS@FRS
Subject Lending facility for AIG proposed today
Bank, Broker/Dealer & Insurance Underwriter - Operations and Strategy

Report: Feds asking i-bank support for potential AIG options
September 15, 2008 3:57 PM ET
By Thomas Mason
The U.S. government has requested JPMorgan Chase & Co. and Goldman Sachs Group
Inc. lead a lending facility for American International Group Inc. to the tune of $70 billion
to $75 billion, The Wall Street Journal reported in a posting to its Web site on Sept. 15.
Meanwhile, the New York Times' DealBook blog reported in a posting at 1:56 p.m. Eastern
time that the Federal Reserve has hired Morgan Stanley for advice on potential options to
support the insurance behemoth. The Times said aid could include a $20 billion bridge loan.
Earlier, Treasury Secretary Henry Paulson denied that the federal government would
provide a bridge loan.
"What's going on in New York has got nothing to do with any bridge loan from the
government," Paulson said at a Sept. 15 press conference. "What's going on in New York is
BOG-- FOIA 10-251 --000741

a private-sector effort."

Usage of this product is governed by the Master Subscription Agreement
Cynthia Martin
600 Atlantic Avenue
Boston, MA 02210
617 973-3178 (office)

617 619-8478 (fax)
BOG-- FOIA 10-251 --000742

To: Brian F Madigan; William R Nelson; Jon D Greenlee; William B English
Subject: Notes from 3pm call with AIG, NYSID, FRBNY
Date: 09/15/2008 04:20 PM
The call focused on the securities lending program and on the overall plan for AIG.
1. Securities lending
(b) (8)
2. The overall plan

(b) (8)
The investment bankers will brief Tim Geithner at 6pm.
Mike G.
BOG-- FOIA 10-251 --000743

To: Roger Cole; Deborah P Bailey
Subject: Fw: Notes from 3pm call with AIG, NYSID, FRBNY
Date: 09/15/2008 04:21 PM
I was on the call. Mike's summary below is accurate.
Jon Greenlee
Associate Director
Phone (202) 452-2962
Duplicate
BOG-- FOIA 10-251 --000744

To: Rita C Proctor; Donald L Kohn; Elizabeth A Duke; Randall S Kroszner; Kevin Warsh
Date: 09/15/2008 04:26 PM
FYI. You may have gotten this from other channels.

Jon D
Greenlee/BOARD/FRS
To Roger Cole/BOARD/FRS@BOARD, Deborah P
cc
09/15/2008 04:21 PM
Subject Fw: Notes from 3pm call with AIG, NYSID, FRBNY
Duplicate
BOG-- FOIA 10-251 --000745

From: Rita C Proctor
To: (b) (6)
Date: 09/15/2008 04:28 PM
Deborah P
Bailey/BOARD/FRS
To Rita C Proctor/BOARD/FRS@BOARD, Donald L
Kohn/BOARD/FRS@BOARD, Elizabeth A
Duke/BOARD/FRS@BOARD, Randall S
09/15/2008 04:26 PM Kroszner/BOARD/FRS@BOARD, Kevin
cc
FYI. You may have gotten this from other channels.

Jon D
Greenlee/BOARD/FRS
To Roger Cole/BOARD/FRS@BOARD, Deborah P
cc
09/15/2008 04:21 PM
Duplicate
BOG-- FOIA 10-251 --000746

Cc: Brian F Madigan; Michael S Gibson; William B English; William R Nelson
Subject: Re: Notes from 3pm call with AIG, NYSID, FRBNY
Date: 09/15/2008 04:31 PM
(b) (8)
Mike - thanks for doing this.
Jon
Jon Greenlee
Associate Director
Phone (202) 452-2962
Michael S
Gibson/Board/FRS
To Brian F Madigan/BOARD/FRS@BOARD, William R
Sent by: Michael S
Nelson/BOARD/FRS@BOARD, Jon D
Gibson/BOARD/FRS
cc
09/15/2008 04:20 PM Subject Notes from 3pm call with AIG, NYSID, FRBNY
(b) (8)
BOG-- FOIA 10-251 --000747

Date: 09/15/2008 04:32 PM
thanks Mike. (b) (5)
Office: 202-452-3579
Mobile: (b) (6)
Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS
cc
(b) (8)
BOG-- FOIA 10-251 --000748

Date: 09/15/2008 04:33 PM
(b) (5)
William R
Nelson/BOARD/FRS
cc
09/15/2008 04:32 PM Subject
Re: Notes from 3pm call with AIG, NYSID, FRBNY
thanks Mike. (b) (5)
Office: 202-452-3579
Mobile: 703-340-4542
Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS
cc
Duplicate
BOG-- FOIA 10-251 --000749

To: Brian F Madigan
Date: 09/15/2008 04:33 PM
Office: 202-452-3579
Mobile: 703-340-4542
Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS cc
Subject
09/15/2008 04:33 PM
(b) (5)
William R
Nelson/BOARD/FRS
cc
09/15/2008 04:32 PM Subject
Duplicate
BOG-- FOIA 10-251 --000750

Date: 09/15/2008 04:36 PM
Pat, I forgot to include you on this. Mike

Michael S
Gibson/Board/FRS
Sent by: Michael S
Gibson/BOARD/FRS
cc
Duplicate
BOG-- FOIA 10-251 --000751

From: (b) (6)
To: Brian F Madigan
Cc: Donald L Kohn; Scott Alvarez
Subject: Re: Draft memo on AIG
Date: 09/15/2008 04:53 PM
------Brian, here is the email on AIG that I composed before our conversation---------
---
(b) (5)
Brian:
(b) (5)
(b) (5)
Ben
Brian F
Madigan/BOARD/FRS
To (b) (6) Donald L
cc Scott Alvarez/BOARD/FRS@BOARD
09/15/2008 03:30 PM
Subject Draft memo on AIG
BOG-- FOIA 10-251 --000752

(b) (5)
BOG-- FOIA 10-251 --000753

(b) (5)
BOG-- FOIA 10-251 --000754

(b) (5)
BOG-- FOIA 10-251 --000755

(b) (5)
BOG-- FOIA 10-251 --000756

(b) (5)
BOG-- FOIA 10-251 --000757

(b) (5)
BOG-- FOIA 10-251 --000758

(b) (5)
BOG-- FOIA 10-251 --000759

(b) (5)
BOG-- FOIA 10-251 --000760

(b) (5)
BOG-- FOIA 10-251 --000761

(b) (5)
BOG-- FOIA 10-251 --000762

(b) (5)
BOG-- FOIA 10-251 --000763

(b) (5)
BOG-- FOIA 10-251 --000764

From: Adrienne Haden
To: BSR Operational & IT Risk; Chris Chukwu
Subject: Fw: Afternoon Liquidity Team Update
Date: 09/15/2008 04:55 PM
Adrienne Haden
Assistant Director
(202)452-2058 Office
(202)528-7892 Mobile
----- Forwarded by Adrienne Haden/BOARD/FRS on 09/15/2008 04:55 PM -----
Jon D
Greenlee/BOARD/FRS
Nichols/BOARD/FRS@BOARD, Adrienne
09/15/2008 03:56 PM Haden/BOARD/FRS@BOARD
cc
Subject Fw: Afternoon Liquidity Team Update
Jon Greenlee
Associate Director
Phone (202) 452-2962
Thomas J
O'Keeffe/NY/FRS@FRS
To Alejandro LaTorre/NY/FRS@FRS, Alexa
Philo/NY/FRS@FRS, Amy White/NY/FRS@FRS, Andrew
Small/NY/FRS@FRS, Anthony Cirillo/NY/FRS@FRS,
09/15/2008 03:53 PM Arthur Angulo/NY/FRS@FRS, Barbara
Gorzkowski/NY/FRS@FRS, Barbara
Yelcich/NY/FRS@FRS, Bard Stermasi/NY/FRS@FRS,
Brandon Hall/NY/FRS@FRS, Brian
Peters/NY/FRS@FRS, Caren Cox/NY/FRS@FRS,
Caroline Frawley/NY/FRS@FRS, Caroline
Nuffort/NY/FRS@FRS, Catherine A
Tilford/BOARD/FRS@BOARD, Catherine
Voigts/NY/FRS@FRS, Chris Haley/BOS/FRS@FRS,
Chris McCurdy/NY/FRS@FRS, Christina
Zausner/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS, Christopher
Powell/NY/FRS@FRS, Claudia Franco/NY/FRS@FRS,
Stefansson/BOARD/FRS@BOARD, Craig F
Marchbanks/BOARD/FRS@BOARD, Craig
Leiby/NY/FRS@FRS, Cynthia Graves/NY/FRS@FRS,
Daniel Muccia/NY/FRS@FRS, Daniel
Sullivan/NY/FRS@FRS, Deborah Lohnau/NY/FRS@FRS,
BOG-- FOIA 10-251 --000765

Deborah P Bailey/BOARD/FRS@BOARD, Denise
Goodstein/NY/FRS@FRS, Dennis Herbst/NY/FRS@FRS,
Dennis Ryan/NY/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS, Dmitry J
Gershik/NY/FRS@FRS, Elizabeth
Gress/RICH/FRS@FRS, Elizabeth
Tafone/NY/FRS@FRS, Gail Santora/NY/FRS@FRS,
Genevievette.E.Walker@frb.gov, Gerard
Dages/NY/FRS@FRS, Glen Reppy/NY/FRS@FRS,
Gretchen Cappiello/NY/FRS@FRS, Gretchen
Walker/NY/FRS@FRS, H Clay Saylor/NY/FRS@FRS,
Hasan Latif/NY/FRS@FRS, Hayley
Boesky/NY/FRS@FRS, Homer Hill/NY/FRS@FRS,
Isabella Lo Piccolo/NY/FRS@FRS, Jack
Jennings/BOARD/FRS@BOARD, James
Embersit/BOARD/FRS@BOARD, James
Hodgetts/NY/FRS@FRS, James Wall/NY/FRS@FRS,
Jan Voigts/NY/FRS@FRS, Jane Green/NY/FRS@FRS,
Jane Majeski/NY/FRS@FRS, Jane
Wakefield/NY/FRS@FRS, Jeanmarie
Davis/NY/FRS@FRS, Jeffrey Kowalak/NY/FRS@FRS,
Jeffrey Levine/NY/FRS@FRS, Jeffrey
Plaskett/SF/FRS@FRS, Jim Mahoney/NY/FRS@FRS,
Joanna Wisniecka/NY/FRS@FRS, John
Beebe/RICH/FRS@FRS, John Heinze/NY/FRS@FRS,
John Reynolds/NY/FRS@FRS, John
Ricketti/NY/FRS@FRS, John Ruocco/NY/FRS@FRS, Jon
D Greenlee/BOARD/FRS@BOARD, Jonathan
Polk/NY/FRS@FRS, Joseph Galati/NY/FRS@FRS, Judith
J Gruttman/NY/FRS@FRS, Kara
Sulmasy/NY/FRS@FRS, Karen Kahrs/NY/FRS@FRS,
Katheryn Van der Celen/NY/FRS@FRS, Kenton
Beerman/NY/FRS@FRS, Kerry STREETS/NY/FRS@FRS,
Kevin Clarke/NY/FRS@FRS, Kevin
Coffey/NY/FRS@FRS, Kevin Lee/NY/FRS@FRS, Kevin
Littler/RICH/FRS@FRS, Kirsten Harlow/NY/FRS@FRS,
Kyle Grieser/NY/FRS@FRS, Lance Auer/NY/FRS@FRS,
Larry Bonnemere/NY/FRS@FRS, Laura A
Macedo/BOARD/FRS@BOARD, Lawrence
ROSTOKER/NY/FRS@FRS, Laxmi Rao/NY/FRS@FRS,
Lily Tham/NY/FRS@FRS, Linda
Rodriguez/NY/FRS@FRS, Lisa A
White/RICH/FRS@FRS, Lisa Joniaux/NY/FRS@FRS,
Lucinda M Brickler/NY/FRS@FRS, Lydia
Tshulos/NY/FRS@FRS, Mark Scapp/NY/FRS@FRS, Meg
McConnell/NY/FRS@FRS, Meinrad
Danzer/NY/FRS@FRS, Michael Johnson/SF/FRS@FRS,
Myron L Kwast/BOARD/FRS@BOARD, Bin
Lang/NY/FRS@FRS, Brian Hefferle/NY/FRS@FRS,
Caroline Nuffort/NY/FRS@FRS, Isabella Lo
Piccolo/NY/FRS@FRS, Joanna Wisniecka/NY/FRS@FRS,
Joshua Sherwin/NY/FRS@FRS, Kathryn
Chen/NY/FRS@FRS, Kenton Beerman/NY/FRS@FRS,
Mayra Gonzalez/NY/FRS@FRS, Randolph
Brown/NY/FRS@FRS, Susan G Ballinger/NY/FRS@FRS,
Susan Goldberg/NY/FRS@FRS, Thomas J
O'Keeffe/NY/FRS@FRS, Pamela S
Powell/BOARD/FRS@BOARD, Pat
Soriano/BOARD/FRS@BOARD, Patrick M
Parkinson/BOARD/FRS@BOARD, Patrick
Roche/NY/FRS@FRS, Philip Aquilino/SF/FRS@FRS,
Ralph Santasiero/NY/FRS@FRS, Randolph
Brown/NY/FRS@FRS, Renuka
Vijayanathan/NY/FRS@FRS, Richard
Heeseler/NY/FRS@FRS, Richard Kunen/NY/FRS@FRS,
Richard Naylor/BOARD/FRS@BOARD, Richard
Roberts/NY/FRS@FRS, Richard
Westerkamp/RICH/FRS@FRS, Rick
Weaver/NY/FRS@FRS, Robert D
Patalano/NY/FRS@FRS, Robert
BOG-- FOIA 10-251 --000766

Gutierrez/NY/FRS@FRS, Roberto
Perli/BOARD/FRS@BOARD, Roger
Graham/NY/FRS@FRS, Rohit Bansal/NY/FRS@FRS,
Ron Fox/RICH/FRS@FRS, Ronald Stroz/NY/FRS@FRS,
Sandy Krieger/NY/FRS@FRS, Sara
Mahmoud/NY/FRS@FRS, Sarah
Dahlgren/NY/FRS@FRS, Stacy.L.Coleman@rich.frb.org,
Stanley Poszywak/RICH/FRS@FRS, Stephanie
Chaly/NY/FRS@FRS, Steven Friedman/NY/FRS@FRS,
Steven J Manzari/NY/FRS@FRS, Steven
Mirsky/NY/FRS@FRS, Susan G Ballinger/NY/FRS@FRS,
Susan Goldberg/NY/FRS@FRS, Terrence
Checki/NY/FRS@FRS, Theodore Lubke/NY/FRS@FRS,
Theonilla Lee-Chan/NY/FRS@FRS, Theresa
Barry/BOS/FRS@FRS, Thomas Dolan/NY/FRS@FRS,
Thomas J O'Keeffe/NY/FRS@FRS,
Tim.P.Clark@frb.gov, Todd
William B English/BOARD/FRS@BOARD, William
BRODOWS/NY/FRS@FRS, William
Rutledge/NY/FRS@FRS, Wing Oon/NY/FRS@FRS,
Alexa Philo/NY/FRS@FRS, Ann Miner/NY/FRS@FRS,
Barbara Yelcich/NY/FRS@FRS, Betsy
Gordon/NY/FRS@FRS, Caroline Frawley/NY/FRS@FRS,
Catherine Voigts/NY/FRS@FRS, Che
Sidanius/NY/FRS@FRS, Christopher
Hunter/NY/FRS@FRS, Claudia Franco/NY/FRS@FRS,
Clinton Lively/NY/FRS@FRS, Deborah
Lohnau/NY/FRS@FRS, Denise
Goodstein/NY/FRS@FRS, Dennis Ryan/NY/FRS@FRS,
Dianne Dobbeck/NY/FRS@FRS, Glen
Reppy/NY/FRS@FRS, Gregory Gaare/NY/FRS@FRS,
Jacqueline Lovisa/NY/FRS@FRS, James
DeFalco/NY/FRS@FRS, James Wall/NY/FRS@FRS,
Jane Wakefield/NY/FRS@FRS, Jeanmarie
Davis/NY/FRS@FRS, Jim Mahoney/NY/FRS@FRS, John
Harvey/NY/FRS@FRS, John Reynolds/NY/FRS@FRS,
John Ricketti/NY/FRS@FRS, John
Ruocco/NY/FRS@FRS, Karen Kahrs/NY/FRS@FRS, Lisa
Joniaux/NY/FRS@FRS, Lydia Tshulos/NY/FRS@FRS,
Mark Scapp/NY/FRS@FRS, Patrick
Roche/NY/FRS@FRS, Peter Drake/NY/FRS@FRS, Ralph
Santasiero/NY/FRS@FRS, Randolph
Brown/NY/FRS@FRS, Richard Cahill/NY/FRS@FRS,
Sara Mahmoud/NY/FRS@FRS, Sarah
Dahlgren/NY/FRS@FRS, Stephanie
Steven Mirsky/NY/FRS@FRS, Susan
Goldberg/NY/FRS@FRS, Timothy Carlin/NY/FRS@FRS,
Todd Waszkelewicz/NY/FRS@FRS, Yogesh
Shah/NY/FRS@FRS
cc Bin Lang/NY/FRS@FRS, Brian Hefferle/NY/FRS@FRS,
Caroline Nuffort/NY/FRS@FRS, Isabella Lo
Piccolo/NY/FRS@FRS, Joanna Wisniecka/NY/FRS@FRS,
Joshua Sherwin/NY/FRS@FRS, Kathryn
Chen/NY/FRS@FRS, Kenton Beerman/NY/FRS@FRS,
Mayra Gonzalez/NY/FRS@FRS, Randolph
Brown/NY/FRS@FRS, Susan G Ballinger/NY/FRS@FRS,
Susan Goldberg/NY/FRS@FRS, Thomas J
O'Keeffe/NY/FRS@FRS
Subject Afternoon Liquidity Team Update
Restricted F.R.
BOG-- FOIA 10-251 --000767

Afternoon Liquidity Team Update:
(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000768

(b)(4) & (b)(8)
************************************************
Bank Supervision
(212)720-5568
***********************************************
BOG-- FOIA 10-251 --000769

From: Heidilynne.Schultheiss@do.treas.gov
To: KingE@SEC.GOV; Patrick.M.Parkinson@frb.gov; Pat.White@frb.gov; Michael.Nelson@ny.frb.org;
william.dudley@ny.frb.org; MLoesch@CFTC.gov; eshaw@cftc.gov; kathryn.dick@occ.treas.gov;
kurt.wilhelm@occ.treas.gov
Subject: Bush To Be Briefed By Financial Markets Working Group Tuesday
Date: 09/15/2008 05:01 PM
Bush To Be Briefed By Financial Markets Working Group Tuesday

By Henry J. Pulizzi
15 September 2008
Dow Jones International News
WASHINGTON (Dow Jones)--U.S. President George W. Bush on Tuesday will be

briefed on financial-market conditions by his Working Group on Financial Markets,
White House spokesman Tony Fratto said Monday.
The briefing will occur after Bush returns from a trip to Houston and Galveston,
Texas, where he will inspect areas damaged by Hurricane Ike.
The working group is led by Treasury Secretary Henry Paulson, and includes the
chairs of the Federal Reserve Board, the Securities and Exchange Commission and
the Commodity Futures Trading Commission.
Bush and Paulson met earlier Monday, as the collapse of Lehman Brothers (LEH)
and the woes of American International Group (AIG) sent shudders through markets.
The Dow Jones Industrial Average closed down more than 500 points, a massive
sell-off propelled by investor fears over the health of the financial system.
Though the working group meets regularly, Bush hasn't sat down with it since March
17, a day after the Fed provided a backstop for J.P. Morgan Chase's (JPM) purchase
of Bear Stearns.
Earlier Monday, Bush said the administration is working to ease any pain the market's
current problems may inflict on the economy at large.
"In the short run, adjustments in the financial markets can be painful - both for the
people concerned about their investments, and for the employees of the affected
firms," he said. "In the long run, I'm confident that our capital markets are flexible and
resilient, and can deal with these adjustments."
BOG-- FOIA 10-251 --000770

From: Sola Majolagbe
Chris Haley; Chris McCurdy; Christopher Calabia; Claudia Franco; Clinton Lively; Corbin Long; Coryann
Stefansson; Craig F Marchbanks; Craig Leiby; Cynthia Graves; Daniel Muccia; Denise Goodstein; Dennis Ryan;
Dexter Williams; Diane Rose; Dianne Dobbeck; Genevievette.E.Walker@frb.gov; Gretchen Cappiello; H Clay
Saylor; Andrea R Tokheim; Homer Hill; Jack Jennings; James Hodgetts; James Wall; Jan Voigts; Jane Majeski;
Jane Wakefield; Jeanmarie Davis; Jeffrey Levine; Jennifer Burns; Jim Mahoney; John Beebe; John Heinze; John
Reynolds; John Ricketti; John Ruocco; Jon D Greenlee; Jonathan Polk; Joseph Galati; Judith J Gruttman; Jyoti
Kohli; Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kevin Clarke; Kevin Lee; Kirsten Harlow; Kyle
Grieser; Lance Auer; Larry Bonnemere; Laura A Macedo; Laxmi Rao; Lily Tham; Linda Rodriguez; Lisa A White;
Lisa Joniaux; Lucinda M Brickler; Luis Uranga; Lydia Tshulos; Marilyn Arbuthnott; Mark Scapp; Mayra Gonzalez;
Michael Johnson; Myron L Kwast; Pamela S Powell; Pat Soriano; Patrick M Parkinson; Patrick Roche; Philip
Aquilino; Ralph Santasiero; Richard Naylor; Richard Roberts; Richard Westerkamp; Rick Weaver; Robert
Gutierrez; Roger Graham; Ronald Stroz; Sandy Krieger; Sara Mahmoud; Sarah Dahlgren;
Stacy.L.Coleman@rich.frb.org; Stanley Poszywak; Stephanie Chaly; Steven J Manzari; Steven Mirsky; Susan G
Ballinger; Terry Muckleroy; Theodore Lubke; Theonilla Lee-Chan; Theresa Barry; Thomas J O'Keeffe;
Tim.P.Clark@frb.gov; Todd Waszkelewicz; Wendy Ng; William BRODOWS; William Hallacy; Wing Oon
Subject: Update with Richard Evans on the European Market condition
Date: 09/15/2008 05:16 PM
Notes from conference with Richard Evans (Chief Risk Officer for
Institutional Clients Group)
(b)(4) & (b)(8)

BOG-- FOIA 10-251 --000771

From: Philip Aquilino
Cc: Michael Johnson; Coryann Stefansson; Nancy J Oakes; Jennifer Su; Jeffrey Plaskett; Fred Minardi; Michele
Magidoff; Robert Speaks; Donna O'Kane; Teresa Curran; Steve Hoffman; David M Wright; Jon D Greenlee
Subject: WFC 9/15 Update (as of 2pm PST)
Date: 09/15/2008 05:17 PM
Attachments: short term funding 9-12-08.xls
Restricted F.R.
Credit Risk (Philip Aquilino and Fred Minardi)

Not Responsive
(b)(4) & (b)(8)
Liquidity Risk (Jeff Plaskett and Fred Minardi)
Market Perspective
Not Responsive D
Not Responsive
BOG-- FOIA 10-251 --000772

Not Responsive
The latest short term funding report:
BOG-- FOIA 10-251 --000773

Not Responsive
BOG-- FOIA 10-251 --000774

Not Responsive
BOG-- FOIA 10-251 --000775

Not Responsive
BOG-- FOIA 10-251 --000776

To: JNellie Liang; William B English; Michael S Gibson; Daniel M Covitz
Subject: AIG subs CP
Date: 09/15/2008 05:25 PM
Internal FR-Confidential
We detected three unsecured financial CP programs from AIG subsidiaries in our

database (the last two programs were not included in our initial report.):
1. AIG Funding Inc with $5.8 billion outstanding as of Sept. 12 ($1.9 billion coming
due over the next 7 days).
2. International Lease Finance Corporation with $3.6 billion outstanding as of Sept
12 ($1.2 billion coming due over the next 7 days).
3. American General Finance Corporation with $3.3 billion outstanding as of Sept 12
($1.1 billion coming due over the next 7 days).
On Sept. 12, these three programs paid 35 to 50 basis points above the average AA
financial rate to issue 30-day paper. (The AA financial rate is about 40 basis points
above the average AA nonfinancial rate).
In addition, AIG or affiliates sponsor two ABCP programs and one SIV with combined
outstandings of $5.1 billion as of Sept. 12 ($1.9 billion coming due over the next 7
days).
BOG-- FOIA 10-251 --000777

To: Brian F Madigan
Subject: AIG memo
Date: 09/15/2008 05:27 PM
Here is the memo. It still says "draft."

(b) (5)
Circulate to the authors?
Bill
Office: 202-452-3579
Mobile: (b) (6)
BOG-- FOIA 10-251 --000778

(b) (5)
BOG-- FOIA 10-251 --000779

(b) (5)
BOG-- FOIA 10-251 --000780

(b) (5)
BOG-- FOIA 10-251 --000781

(b) (5)
BOG-- FOIA 10-251 --000782

(b) (5)
BOG-- FOIA 10-251 --000783

(b) (5)
BOG-- FOIA 10-251 --000784

(b) (5)
BOG-- FOIA 10-251 --000785

(b) (5)
BOG-- FOIA 10-251 --000786

(b) (5)
BOG-- FOIA 10-251 --000787

(b) (5)
BOG-- FOIA 10-251 --000788

(b) (5)
BOG-- FOIA 10-251 --000789

From: Mark Carey
To: IF Officers and Section Chiefs
Subject: International ramifications of an AIG failure
Date: 09/15/2008 05:29 PM
Broad-brush picture of AIG's businesses:
Insurance is well over 90 percent of the consolidated business. Roughly, 50 to 60 of

the insurance business is property-casualty (including reinsurance) and the
remainder is life & annuity.
(Breakdowns by type can only be done by revenue-type measures and the variant of
accounting rules used can affect the breakdown.)
About one-quarter of the property-casualty business is done outside the U.S. About
80 percent of the life & annuity business is outside the U.S.
Almost all AIG's trouble is not in the insurance subsidiaries, but is caused by it's AIG
Financial Products (AIGFP) derivatives and capital markets operation, which was
always a relatively small part by revenue. AIG's current problem is to 1) be able to
continue to raise somewhere in its corporate structure whatever soon-rolling-over
debt has previously been raised by the holding company or AIGFP, and 2) be able to
move requisite assets to whatever of its subs need them for posting collateral.
The insurance business is essentially all done through subsidiaries, with foreign
business done through foreign subsidiaries. All are regulated to one extent or
another. Much like our Section 23 regulation of banks, which restricts the holding
company's ability to suck capital out of bank subs for use by other subsidiaries,
many insurance regulators limit transfers of wealth from insurance subs to other
parts of the corporate entity.
Thus the importance of the New York insurance commissioner's announcement today
that AIG could temporarily take $20 billion from U.S. insurance subs for use by other
parts of the consolidated entity.
Now turning to international ramifications of a failure, it is hard to be 100% sure of

anything because AIG naturally does not disclose all the details of its operations. My
speculations:
(b) (5)
Finally, capitalization and liquidity:
The equity-to-assets ratio is about 9 percent, with $96 billion of book equity.
Recent press speculation of $19 billion in writeoffs is big enough to get one's
attention, but given that most such writeoffs would occur in AIGFP, maybe the
biggest problem is getting the capital to that entity, as noted previously.
BOG-- FOIA 10-251 --000790

A large fraction off their liabilities are reserves related to insurance products. Debt
outstanding is a relatively small $176 billion relative to $1060 billion of total assets,
and only $13 billion of the debt is short-term. However, as has been noted in the
news, AIG has significant derivative and securities lending positions and market or
rating agency sentiment can affect AIG liquidity by affecting collateral requirements
and other operational aspects of these activities.
Major insurance companies are fiercely complicated entities, in many ways much
more complicated than major investment banks. Too bad Nini is not around
anymore. He knew insurance.
Mark Carey
Adviser
Division of International Finance
Washington, DC 20551 USA
(202) 452-2784 voice
(202) 872-4926 fax
mark.carey@frb.gov email
BOG-- FOIA 10-251 --000791

To: Scott Alvarez; William B English; Roberto Perli; Michael S Gibson; Jon D Greenlee
Cc: Brian F Madigan; James A Clouse
Subject: current draft, AIG memo
Date: 09/15/2008 05:38 PM
Here is the current draft of the AIG memo. Just FYI.
--Bill Attachment is a duplicate
Office: 202-452-3579
Mobile: (b) (6)
BOG-- FOIA 10-251 --000792

From: Paul Bhatti
Cc: Caroline Frawley; John Reynolds; Betsy Gordon; Paul H Austin; Christopher Powell; Jordan Pollinger; Andrew
Small
Subject: UBS Market Risk Update
Date: 09/15/2008 05:42 PM
UBS Market Risk Update: Sept 15 @4:00PM
UBS Attendees: Tom Daula (CRO-IB), Mike Jemiolo (Head MRC), David Bawden
(Credit Concentration)
FRBNY: Austin, Bhatti, Gordon, Reynolds, & Small.
General topics
Not Responsive
(b)(4) & (b)(8)
UBS specific topics

Not Responsive
Not Responsive
Not
Respon
sive
BOG-- FOIA 10-251 --000793

Not Responsive
BOG-- FOIA 10-251 --000794

Not Responsive

BOG-- FOIA 10-251 --000795

From: David W Skidmore
Subject: Fw: WSJA(9/16) US Fed Officials Likely To Hold Rates Steady
Date: 09/15/2008 05:50 PM
This reads like a signal from on high. Did they get help?
------------------------------------------------------
WSJA(9/16) US Fed Officials Likely To Hold Rates Steady

Monday, September 15, 2008 5:32:12 PM (GMT-04:00)
Provided by: Dow Jones Capital Markets Report
(From THE WALL STREET JOURNAL ASIA)

By Sudeep Reddy and Jon Hilsenrath
U.S. Federal Reserve officials aren't inclined to veer from plans to hold short-term
interest rates steady at Tuesday's meeting, even though financial markets put rising
odds on a quick rate cut following the weekend's drama on Wall Street.
But concern about deteriorating markets and financial institutions could quickly
prompt a change of heart among Fed officials or lead them to use their end-of-
meeting statement to open the door to more rate cuts.
The case for a quick rate cut: The market turmoil could add significantly to the risk
of weaker economic growth ahead. The Fed has taken pre-emptive action repeatedly
over the past year, cutting interest rates as protection against a deeper economic
downturn. The failure of Lehman Brothers Holdings Inc., the rapid takeover of Merrill
Lynch & Co. by Bank of America Corp. and continuing concerns about insurance
giant American International Group Inc. added to those.
The decision depends largely on whether the market fallout, which remained
limited in the U.S. early Monday, worsens on Tuesday. Fed officials expect some
stress in markets. They are hoping it will remain manageable and not put too much
pressure on credit conditions and the overall economic outlook. But they also
recognize that markets haven't faced the failure of a major investment bank with the
financial system as interconnected as it is today.
Futures markets on Monday put better than 50-50 odds on the Fed cutting the
current 2% federal-funds rate, at which banks lend to each other overnight, by a
quarter percentage point on Tuesday. Before the weekend, traders put the likelihood
at just 10%.
The risk for policy makers: Cutting rates immediately could remove some of their
flexibility in case the financial crisis worsens. The Fed cut rates after the market
crash in 1987 -- a 25% drop in stocks -- and after the Sept. 11, 2001, terrorist
attacks. But in both cases the potential turmoil was much clearer.
They are likely to be resistant to taking action after less than two days of trading,
when the longer-term impact on credit costs and credit availability will be unclear.
The Fed previously has inserted language in its post-meeting statement to signal a
willingness to take action between meetings if necessary. Those words could re-
emerge on Tuesday.
At the very least, Fed officials are likely to suggest "increased uncertainty and
increased downside risks as a result of the turmoil and the likely associated
restriction of credit," UBS economists said in a note to clients.
Fed officials will likely point to other action they have taken to calm financial
markets. Policy makers over the past year have sought to distinguish between
interest-rate policy, targeted to address economic conditions, and the Fed's lending
BOG-- FOIA 10-251 --000796

programs designed to ease short-term funding problems.
The Fed expanded its lending facilities substantially on Sunday night, accepting
equities as collateral for its loans.
Click here to go to Dow Jones NewsPlus, a web front page of today's most
important business and market news, analysis and commentary:
http://www.djnewsplus.com/al?rnd=aprnwPJ%2Bteb%2FqWP%2B8tohNQ%3D%3D.
You can use this link on the day this article is published and the following day.
(END) Dow Jones Newswires

09-15-08 1732ET
Copyright (c) 2008 Dow Jones & Company, Inc.(AP-DJ)--09-15-08 1732EDT
Retrieval ID: 222861+15SEP2008+DJCM;1
Copyright © 2008 Dow Jones Capital Markets Report
BOG-- FOIA 10-251 --000797

From: Donald N Gabbai
To: John T Colwell
Cc: Sabeth I Siddique
Subject: CDS spreads for insurance cos.
Date: 09/15/2008 05:53 PM
Attachments: CDS insurance.xls
John:
please include this in the report for tonight. Call it: Insurance companies and
monolines. Only print tabs called: AIG, AA, a, BBB_CCC.
Call me if you have any questions. I will be here for a while.
Donald
BOG-- FOIA 10-251 --000798

CDS Spreads for Selected Insurance Companies July 1 2008 - September 12 2008
A+ A+ A+ A+ A A AA- BBB+ BBB+ BBB+ BBB+ BBB CCC- AA- AA AA

Genworth Prudential MetLife Hartford XL Loews AIG MGIC Assurant CNA PMI Unitrin FGIC Swiss Re AMBAC MBIA
7/1/2008 CGNW1U5 Index CPRU1U5 Index CMET1U5 Index CHIG1U5 Index CXL1U5 Index CLTR1U5 Index CAIG1U5 Index CMTGI1U5 Index CAIZ1U5 Index CCNAF1U5 Index
Last Price 7/1/2008 296.789 7/1/2008 149.95 7/1/2008 123.3 7/1/2008 114.904 7/1/2008 313.382 7/1/2008 56.708 7/1/2008 224.239 7/1/2008 931.438 7/1/2008 122 7/1/2008 122.559 7/1/2008 1385.333 7/1/2008 175 7/1/2008 4471.99 07/01/08 129.0811 7/1/2008 2502.194 7/1/2008 2262.017
7/2/2008 302.689 7/2/2008 151.749 7/2/2008 121.65 7/2/2008 117.99 7/2/2008 319.694 7/2/2008 56.972 7/2/2008 230.155 7/2/2008 977.4 7/2/2008 122 7/2/2008 120.645 7/2/2008 1417.848 7/2/2008 175 7/2/2008 4323.428 07/02/08 127.8599 7/2/2008 2370.417 7/2/2008 2109.042
7/3/2008 319.125 7/3/2008 154.95 7/3/2008 124.546 7/3/2008 121.65 7/3/2008 338.836 7/3/2008 57.774 7/3/2008 229.594 7/3/2008 971.493 7/3/2008 122 7/3/2008 121.65 7/3/2008 1421.671 7/3/2008 175 7/3/2008 4505.714 07/03/08 131.3794 7/3/2008 2242.131 7/3/2008 2065.463
7/4/2008 322.64 7/4/2008 155.016 7/4/2008 124.546 7/4/2008 121.716 7/4/2008 339.166 7/4/2008 57.807 7/4/2008 228.142 7/4/2008 970.635 7/4/2008 122 7/4/2008 122.409 7/4/2008 1407.53 7/4/2008 175 7/4/2008 4508.061 07/04/08 131.1657 7/4/2008 2256.851 7/4/2008 2017.486
7/7/2008 315.99 7/7/2008 150.379 7/7/2008 125 7/7/2008 120.594 7/7/2008 346.65 7/7/2008 57.495 7/7/2008 233.198 7/7/2008 939.209 7/7/2008 121.5 7/7/2008 125.99 7/7/2008 1399.455 7/7/2008 175 7/7/2008 3741.667 07/07/08 132.0699 7/7/2008 1864.966 7/7/2008 1816.403
7/8/2008 321.039 7/8/2008 153.3 7/8/2008 124.868 7/8/2008 119.934 7/8/2008 346.65 7/8/2008 56.835 7/8/2008 232.274 7/8/2008 934.226 7/8/2008 122.667 7/8/2008 126.65 7/8/2008 1357.408 7/8/2008 175 7/8/2008 3884.828 07/08/08 136.8724 7/8/2008 1864.681 7/8/2008 1722.168
7/9/2008 321.675 7/9/2008 155.094 7/9/2008 121.505 7/9/2008 120 7/9/2008 349.711 7/9/2008 57.845 7/9/2008 230 7/9/2008 933.617 7/9/2008 122.5 7/9/2008 123.325 7/9/2008 1228.838 7/9/2008 175 7/9/2008 3804.095 07/09/08 130.2962 7/9/2008 1495.18 7/9/2008 1359.684
7/10/2008 324.183 7/10/2008 155.094 7/10/2008 122.231 7/10/2008 119.769 7/10/2008 351.889 7/10/2008 56.855 7/10/2008 232.665 7/10/2008 911.502 7/10/2008 122.5 7/10/2008 123.325 7/10/2008 1276.898 7/10/2008 175 7/10/2008 3839.474 07/10/08 130.1354 7/10/2008 1551.666 7/10/2008 1491.009
7/11/2008 330.709 7/11/2008 155.985 7/11/2008 122.429 7/11/2008 120.066 7/11/2008 357.615 7/11/2008 56.855 7/11/2008 240.957 7/11/2008 922.508 7/11/2008 122.5 7/11/2008 123.325 7/11/2008 1346.817 7/11/2008 175 7/11/2008 4007.349 07/11/08 132.1127 7/11/2008 1564.107 7/11/2008 1503.365
7/14/2008 322.211 7/14/2008 153.934 7/14/2008 120.251 7/14/2008 116.436 7/14/2008 357.26 7/14/2008 56.02 7/14/2008 239.505 7/14/2008 949.406 7/14/2008 122.5 7/14/2008 123.241 7/14/2008 1326.705 7/14/2008 175 7/14/2008 3689.867 07/14/08 129.3372 7/14/2008 1535.077 7/14/2008 1459.715
7/15/2008 331.625 7/15/2008 156.975 7/15/2008 123.056 7/15/2008 121.957 7/15/2008 376.864 7/15/2008 55.949 7/15/2008 247.871 7/15/2008 959.421 7/15/2008 122.5 7/15/2008 122 7/15/2008 1335.312 7/15/2008 175 7/15/2008 3526.828 07/15/08 136.7355 7/15/2008 1652.649 7/15/2008 1563.874
7/16/2008 333.011 7/16/2008 156.645 7/16/2008 124.16 7/16/2008 124.929 7/16/2008 383.886 7/16/2008 54.784 7/16/2008 251.65 7/16/2008 962.061 7/16/2008 122.5 7/16/2008 122.221 7/16/2008 1284.622 7/16/2008 175 7/16/2008 3653.461 07/16/08 138.2495 7/16/2008 1622 7/16/2008 1518.044
7/17/2008 329.175 7/17/2008 151.34 7/17/2008 122.939 7/17/2008 120.784 7/17/2008 379.439 7/17/2008 54.355 7/17/2008 245.05 7/17/2008 945.1 7/17/2008 122.5 7/17/2008 121.231 7/17/2008 1250 7/17/2008 175 7/17/2008 3269.373 07/17/08 127.3661 7/17/2008 1574.671 7/17/2008 1470.919
7/18/2008 330 7/18/2008 150 7/18/2008 123.995 7/18/2008 120.586 7/18/2008 377.261 7/18/2008 54.053 7/18/2008 242.69 7/18/2008 936.058 7/18/2008 122.5 7/18/2008 121.198 7/18/2008 1219.173 7/18/2008 175 7/18/2008 3115.917 07/18/08 124.7866 7/18/2008 1561.649 7/18/2008 1457.252
7/21/2008 317.525 7/21/2008 150.495 7/21/2008 122.957 7/21/2008 118.086 7/21/2008 377.822 7/21/2008 51.01 7/21/2008 225 7/21/2008 894.227 7/21/2008 122.5 7/21/2008 121.34 7/21/2008 1191.872 7/21/2008 175 7/21/2008 3127.34 07/21/08 120.5618 7/21/2008 1537.42 7/21/2008 1408.924
7/22/2008 323.124 7/22/2008 149.736 7/22/2008 124.495 7/22/2008 114.401 7/22/2008 381.673 7/22/2008 54.086 7/22/2008 231.345 7/22/2008 875.575 7/22/2008 123.333 7/22/2008 120.896 7/22/2008 1219.591 7/22/2008 175 7/22/2008 3224.983 07/22/08 120.6018 7/22/2008 1533.839 7/22/2008 1411.761
7/23/2008 320.946 7/23/2008 147.36 7/23/2008 122.774 7/23/2008 111.949 7/23/2008 377.119 7/23/2008 51.751 7/23/2008 230.256 7/23/2008 868.231 7/23/2008 122.5 7/23/2008 119.906 7/23/2008 1186.533 7/23/2008 175 7/23/2008 3000.357 07/23/08 114.1483 7/23/2008 1478.259 7/23/2008 1400.124
7/24/2008 322.695 7/24/2008 149.109 7/24/2008 123.764 7/24/2008 107.906 7/24/2008 380.287 8/4/2008 45.835 7/24/2008 229.736 7/24/2008 869.221 7/24/2008 122.5 7/24/2008 119.906 7/24/2008 1198.898 7/24/2008 175 7/24/2008 3057.842 07/24/08 114.2265 7/24/2008 1473.943 7/24/2008 1426.964
7/25/2008 323.66 7/25/2008 150 7/25/2008 124.556 7/25/2008 107.5 7/25/2008 382.919 8/5/2008 45.736 7/25/2008 233.325 7/25/2008 867.341 7/25/2008 122.5 7/25/2008 119.675 7/25/2008 1205.902 7/25/2008 175 7/25/2008 3102.973 07/25/08 116.1801 7/25/2008 1495.886 7/25/2008 1438.78
7/29/2008 340.31 7/29/2008 149.175 7/29/2008 128.079 7/29/2008 109.916 7/29/2008 255.232 8/6/2008 45.538 7/29/2008 239.711 7/29/2008 859.651 7/29/2008 122.5 7/29/2008 119.444 7/28/2008 1213.257 7/28/2008 175 7/28/2008 3078.279 07/28/08 116.0403 7/28/2008 1507.199 7/28/2008 1436.541
7/30/2008 342.01 7/30/2008 149.246 7/30/2008 127.32 7/30/2008 106.581 7/30/2008 227.41 8/7/2008 45.538 7/30/2008 239.33 7/30/2008 883.311 7/30/2008 122.5 7/30/2008 119.345 7/29/2008 1209.87 7/29/2008 175 7/29/2008 2232.585 07/29/08 115.4404 7/29/2008 1429.41 7/29/2008 1338.031
7/31/2008 335.431 7/31/2008 144.695 7/31/2008 130.429 7/31/2008 107.279 7/31/2008 214.179 8/11/2008 45.505 7/31/2008 243.325 7/31/2008 882.321 7/31/2008 123 7/31/2008 118.175 7/30/2008 1176.411 7/30/2008 175 7/30/2008 2337.538 07/30/08 113.4716 7/30/2008 1305.854 7/30/2008 1195.599
8/1/2008 330.15 8/1/2008 143.424 8/1/2008 130.924 8/1/2008 107.213 8/1/2008 201.7 8/12/2008 45.934 8/1/2008 249.678 8/1/2008 885.424 8/1/2008 123 8/1/2008 117.68 7/31/2008 1207.623 7/31/2008 175 7/31/2008 3260.962 07/31/08 117.7387 7/31/2008 1336.277 7/31/2008 1258.905
8/4/2008 329.64 8/4/2008 146.881 8/4/2008 130.28 8/4/2008 107.165 8/4/2008 196.139 8/13/2008 45.934 8/4/2008 253.828 8/4/2008 883.929 8/4/2008 123.5 8/4/2008 117.01 8/1/2008 1170.823 8/1/2008 175 8/1/2008 2998.333 08/01/08 121.9952 8/1/2008 1231.966 8/1/2008 1201.071
8/5/2008 328.97 8/5/2008 146.551 8/5/2008 130.016 8/5/2008 107.165 8/5/2008 186.7 8/15/2008 45.401 8/5/2008 250.33 8/5/2008 867.46 8/5/2008 123.333 8/5/2008 113.911 8/4/2008 1168.162 8/4/2008 175 8/4/2008 3061.833 08/04/08 126.5739 8/4/2008 1249.467 8/4/2008 1198.279
8/6/2008 329.696 8/6/2008 146.485 8/6/2008 129.95 8/6/2008 106.34 8/6/2008 186.931 8/19/2008 46.495 8/6/2008 245.726 8/6/2008 886.446 8/6/2008 123.333 8/6/2008 114.439 8/5/2008 1144.24 8/5/2008 175 8/5/2008 3263.79 08/05/08 124.7456 8/5/2008 1248.221 8/5/2008 1176.047
8/7/2008 346.65 8/7/2008 146.98 8/7/2008 139.579 8/7/2008 106.066 8/7/2008 183.35 8/20/2008 47.089 8/7/2008 270.759 8/7/2008 863.404 8/7/2008 122.5 8/7/2008 116.675 8/6/2008 1122.866 8/6/2008 175 8/6/2008 3046.232 08/06/08 124.5788 8/6/2008 1232.962 8/6/2008 1158.121
8/8/2008 360.214 8/8/2008 150.295 8/8/2008 142.343 8/8/2008 107.254 8/8/2008 185.264 8/21/2008 50.635 8/8/2008 271.419 8/8/2008 863.369 8/8/2008 122.5 8/8/2008 117.335 8/7/2008 1240.221 8/7/2008 175 8/7/2008 3187.447 08/07/08 129.1662 8/7/2008 1330.414 8/7/2008 1220.353
8/11/2008 373.911 8/11/2008 151.96 8/11/2008 142.475 8/11/2008 108.023 8/11/2008 181.139 8/22/2008 50.876 8/11/2008 269.67 8/11/2008 865.644 8/11/2008 122.5 8/11/2008 115 8/8/2008 1246.471 8/8/2008 175 8/8/2008 3613.324 08/08/08 130.1069 8/8/2008 1335.285 8/8/2008 1187.936
8/12/2008 375 8/12/2008 152.29 8/12/2008 143.267 8/12/2008 109.673 8/12/2008 178.799 8/26/2008 50.579 8/12/2008 269.228 8/12/2008 862.542 8/12/2008 123.333 8/12/2008 115.165 8/11/2008 1226.538 8/11/2008 175 8/11/2008 3348.741 08/11/08 127.2747 8/11/2008 1261.404 8/11/2008 1122.235
8/13/2008 377.904 8/13/2008 158.564 8/13/2008 147.625 8/13/2008 113.361 8/13/2008 176.99 8/27/2008 52.221 8/13/2008 278.194 8/13/2008 871.487 8/13/2008 122.5 8/13/2008 117.726 8/12/2008 1204.109 8/12/2008 175 8/12/2008 3499.968 08/12/08 125.216 8/12/2008 1294.794 8/12/2008 1129.526
8/14/2008 379.175 8/14/2008 160.536 8/14/2008 153.861 8/14/2008 119.952 8/14/2008 175.264 8/28/2008 51.83 8/14/2008 289.211 8/14/2008 863.799 8/14/2008 122.5 8/14/2008 117.759 8/13/2008 1252.185 8/13/2008 175 8/13/2008 3723.186 08/13/08 125.0913 8/13/2008 1387.194 8/13/2008 1217.141
8/15/2008 379.266 8/15/2008 164.975 8/15/2008 153.861 8/15/2008 120.787 8/15/2008 173.886 8/29/2008 51.83 8/15/2008 300.66 8/15/2008 862.874 8/15/2008 122.5 8/15/2008 117.759 8/14/2008 1040.08 8/14/2008 175 8/14/2008 3693.847 08/14/08 125.1669 8/14/2008 1392.15 8/14/2008 1186.22
8/19/2008 383.597 8/19/2008 168.305 8/19/2008 160 8/19/2008 133.333 8/19/2008 174.29 9/3/2008 51.599 8/18/2008 320.082 8/19/2008 883.662 8/19/2008 123.333 8/19/2008 116.541 8/15/2008 1040.211 8/15/2008 175 8/15/2008 3617.414 08/15/08 124.6281 8/15/2008 1346.747 8/15/2008 1083.531
8/20/2008 393.911 8/20/2008 191.889 8/20/2008 193.44 8/20/2008 146.336 8/20/2008 180.404 9/4/2008 51.83 8/19/2008 335.214 8/20/2008 893.921 8/20/2008 127.5 8/20/2008 127.739 8/18/2008 1071.363 8/18/2008 175 8/18/2008 3636.154 08/18/08 123.7735 8/18/2008 1400.993 8/18/2008 1164.249
8/21/2008 395 8/21/2008 198.886 8/21/2008 202.211 8/21/2008 161.221 8/21/2008 180.239 9/5/2008 51.929 8/20/2008 349.381 8/21/2008 914.96 8/21/2008 127.5 8/21/2008 127.475 8/19/2008 1131.388 8/19/2008 177.5 8/19/2008 3590.483 08/19/08 125.7743 8/19/2008 1456.969 8/19/2008 1237.983
8/22/2008 392.261 8/22/2008 199.439 8/22/2008 201.246 8/22/2008 158.35 8/22/2008 178.325 9/8/2008 51.746 8/21/2008 367.599 8/22/2008 904.763 8/22/2008 127.5 8/22/2008 125.335 8/20/2008 1147.643 8/20/2008 177.5 8/20/2008 3717.594 08/20/08 125.5473 8/20/2008 1493.911 8/20/2008 1238.605
8/26/2008 391.411 8/26/2008 198.779 8/26/2008 202.005 8/26/2008 159.835 8/26/2008 183.325 9/9/2008 52.241 8/22/2008 365.165 8/26/2008 917.7 8/26/2008 127.5 8/26/2008 127.15 8/21/2008 1184.692 8/21/2008 177.5 8/21/2008 3811.586 08/21/08 129.149 8/21/2008 1496.228 8/21/2008 1234.444
8/27/2008 391.914 8/27/2008 198.094 8/27/2008 203.325 8/27/2008 160.561 8/27/2008 183.061 9/10/2008 50.485 8/25/2008 374.282 8/27/2008 924.96 8/27/2008 127.5 8/27/2008 126.094 8/22/2008 1172.009 8/22/2008 177.5 8/22/2008 3699.936 08/22/08 127.7926 8/22/2008 1500.538 8/22/2008 1225.554
8/28/2008 396.495 8/28/2008 197.01 8/28/2008 202.566 8/28/2008 158.251 8/28/2008 181.675 9/11/2008 51.716 8/26/2008 388.325 8/28/2008 947.752 8/28/2008 129 8/28/2008 127.764 8/25/2008 1169.78 8/25/2008 177.5 8/25/2008 3708.736 08/25/08 127.7926 8/25/2008 1497.538 8/25/2008 1236.835
8/29/2008 389.391 8/29/2008 195.921 8/29/2008 199.439 8/29/2008 156.931 8/29/2008 180.586 9/12/2008 51.815 8/27/2008 389.769 8/29/2008 938.512 8/29/2008 129 8/29/2008 128.325 8/26/2008 1191.867 8/26/2008 177.5 8/26/2008 3774.308 08/26/08 129.7629 8/26/2008 1505.545 8/26/2008 1233.17
9/3/2008 386.784 9/3/2008 192.241 9/3/2008 195.982 9/3/2008 152.099 9/3/2008 171.246 8/28/2008 377.789 9/3/2008 919.577 9/3/2008 129 9/3/2008 123.482 8/27/2008 1231.439 8/27/2008 177.5 8/27/2008 3924.62 08/27/08 132.511 8/27/2008 1522.42 8/27/2008 1245.611
9/4/2008 387.081 9/4/2008 192.571 9/4/2008 197.071 9/4/2008 152.99 9/4/2008 172.335 8/29/2008 377.789 9/4/2008 927.67 9/4/2008 129 9/4/2008 121.675 8/28/2008 1216.167 8/28/2008 177.5 8/28/2008 3350.019 08/28/08 131.6254 8/28/2008 1472.79 8/28/2008 1161.603
9/5/2008 390.381 9/5/2008 192.736 9/5/2008 196.094 9/5/2008 153.98 9/5/2008 174.401 9/1/2008 377.789 9/5/2008 923.049 9/5/2008 129 9/5/2008 122.236 8/29/2008 1201.835 8/29/2008 177.5 8/29/2008 3414.351 08/29/08 126.9153 8/29/2008 1451.594 8/29/2008 1176.092
9/8/2008 386.951 9/8/2008 192.469 9/8/2008 191.545 9/8/2008 150.99 9/8/2008 172.251 9/2/2008 378.218 9/8/2008 888.714 9/8/2008 125.5 9/8/2008 120 9/1/2008 1201.257 9/1/2008 177.5 9/1/2008 3423.658 09/01/08 128.1335 9/1/2008 1449.632 9/1/2008 1182.155
9/9/2008 384.905 9/9/2008 194.02 9/9/2008 193.921 9/9/2008 153.564 9/9/2008 166.65 9/3/2008 381.617 9/9/2008 906.996 9/9/2008 128.667 9/9/2008 120.99 9/2/2008 1183.015 9/2/2008 177.5 9/2/2008 3504.079 09/02/08 124.4172 9/2/2008 1382.004 9/2/2008 1120.734
9/10/2008 387.196 9/10/2008 191.226 9/10/2008 191.556 9/10/2008 156.336 9/10/2008 166.65 9/4/2008 430 9/10/2008 937.422 9/10/2008 132.383 9/10/2008 123.325 9/3/2008 1176.805 9/3/2008 177.5 9/3/2008 3561.749 09/03/08 127.2205 9/3/2008 1358.113 9/3/2008 1127.864
9/11/2008 393.524 9/11/2008 195.285 9/11/2008 193.041 9/11/2008 173.011 9/11/2008 181.17 9/5/2008 438.3 9/11/2008 947.52 9/11/2008 138.25 9/11/2008 125.381 9/4/2008 1175.468 9/4/2008 182.5 9/4/2008 3519.573 09/04/08 128.8064 9/4/2008 1374.497 9/4/2008 1175.628
9/12/2008 405.618 9/12/2008 199.196 9/12/2008 202.739 9/12/2008 182.046 9/12/2008 207.425 9/8/2008 437.624 9/12/2008 951.682 9/12/2008 138.25 9/12/2008 125.645 9/5/2008 1174.49 9/5/2008 185 9/5/2008 3627.03 09/05/08 131.4954 9/5/2008 1379.543 9/5/2008 1182.052
9/9/2008 446.237 9/8/2008 1163.878 9/8/2008 185 9/8/2008 3568.921 09/08/08 124.9603 9/8/2008 1348.719 9/8/2008 1157.143
9/10/2008 467.444 9/9/2008 1196.683 9/9/2008 185 9/9/2008 3605.177 09/09/08 127.1684 9/9/2008 1370.035 9/9/2008 1187.052
9/11/2008 662.338 9/10/2008 1229.911 9/10/2008 185 9/10/2008 4239.555 09/10/08 125.9692 9/10/2008 1385.583 9/10/2008 1204.019
9/12/2008 858.112 9/11/2008 1244.585 9/11/2008 187.5 9/11/2008 4241.827 09/11/08 129.1695 9/11/2008 1406.566 9/11/2008 1203.414
9/15/2008 1468.244 9/12/2008 1240.857 9/12/2008 187.5 9/12/2008 4389.516 09/12/08 129.8391 9/12/2008 1407.495 9/12/2008 1204.463
BOG-- FOIA 10-251 --000799

CDS Spreads for AIG
9/15/08 -12pm
1468.24
1600
1400
1200
1000
800
600
400
200
BOG-- FOIA 10-251 --000800

CDS Spreads for A Rated Securities
450
400
350
300
Genworth
Prudential
250
MetLife
Hartford
200 XL
Loews
150
100
50
BOG-- FOIA 10-251 --000801

CDS Spreads for AA Securities
3000
2500
2000
AMBAC
1500 MBIA
Swiss Re
1000
500
BOG-- FOIA 10-251 --000802

CDS Spreads for BBB & CCC Rated Securities
5000
4500
4000
3500
MGIC
3000
Assurant
CNA
2500
PMI
Unitrin
2000
FGIC
1500
1000
500
BOG-- FOIA 10-251 --000803

To: Jeff Stehm; Jeffrey Marquardt
Subject: today's update
Date: 09/15/2008 06:00 PM
Attachments: Infrastructure Status Report 0915 6PM.doc
202-530-6285
BOG-- FOIA 10-251 --000804

FR Restricted 09/15/08
Monday, September 15th 6:00 PM Infrastructure Status Report

Not Responsive
Page 1 of 3 1
BOG-- FOIA 10-251 --000805
Not Responsive
(b)(4) & (b)(8)
Not Responsive
(b)(4) & (b)(8)
Not Responsive
Page 2 of 3 2
BOG-- FOIA 10-251 --000806
Not Responsive
Page 3 of 3 3
BOG-- FOIA 10-251 --000807
From: David H Bowman
To: Mark Carey
Cc: IF Officers and Section Chiefs
Subject: Re: International ramifications of an AIG failure
Date: 09/15/2008 06:01 PM
It may be of some interest to note that one of AIG's subsidiaries is a nontrivial

player in the FX spot market, acting as a broker for about $30 billion in FX trades
each day, and the the sub conducts most of its trades outside of the CLS
(Continuously-Linked Settlement) system, which means that if the sub failed then
there could be a noticeable disruption to the FX markets.
▼ Mark Carey/BOARD/FRS
Mark
Carey/BOARD/FRS
To IF Officers and Section Chiefs
cc
09/15/2008 05:29 PM Subject International ramifications of an AIG failure
Duplicate
BOG-- FOIA 10-251 --000808

From: Linda Rodriguez
Cc: John Ricketti; Stephanie Chaly; Yogesh Shah; Timothy Carlin; Carol Roller; Pat Soriano; Bridget Habib; Nirali Deringer; Erika Gottfried; Christopher Hunter
Subject: ZFRSSE - Barclays Liquidity/Funding Update & Charts (3pm & 5pm calls)
Date: 09/15/2008 06:03 PM
RESTRICTED FR
Barclays Broker/Dealer:
Not Responsive
(b)(4) & (b)(8)

Not Responsive
The next liquidity/funding call with Barclays will be Tuesday at 8:15am.

Not Responsive
BOG-- FOIA 10-251 --000809

Not Responsive
BOG-- FOIA 10-251 --000810

Not Responsive
BOG-- FOIA 10-251 --000811

From: (b) (4)
To: (b) (4) gustavo.a.suarez@frb.gov; william.dudley@ny.frb.org; william.dudley@ny.frb.org;
Chris.Burke@ny.frb.org
Subject: RE: CP Market Update:
Date: 09/15/2008 06:07 PM
If one more investor asks me to bid back NR or AIG I am going to scream. This
has not been pleasant. Please make tomorrow a better day.
Repo, Fed Fund and CP markets did not have very good days today.Very chaotic,
very wide ranges, investors hunkering down cash and hiding in Tbills, Treasuries right
now. Sec lenders pulling collateral. This is total chaos right now. SOMA program up
to 25.8 bln vs 1.4 bln Friday. These are incredible times.
(b) (4)
BOG-- FOIA 10-251 --000812

From: Antonio Alvarez
Cc: William Hilton; Louis Braunstein; William Hallacy; Glen Snajder; Rinku Shah; John Ruocco; Eric Breitweiser;
Anne Chiou; Sara Mahmoud; Jacqueline Lovisa; Sola Majolagbe; Glen Reppy; Katheryn Van der Celen; Calvin
Bailey; Timothy Sheridan; Christina Zausner; Steven J Manzari
Subject: Citi Counterparty Update 9-15-08 PM
Date: 09/15/2008 06:08 PM
4:30 PM Discussion with Counterparty Risk Management (Tom Schwartz, Head of
Counterparty Credit, & staff) and OCC.
(b)(4) & (b)(8)
D
Not Responsive
Regards,
----------------------------------------------------
Antonio Alvarez
Credit Risk Coordinator - Wholesale
BOG-- FOIA 10-251 --000813

Citigroup Continuous Monitoring Team
Citigroup On-site: (212) 527-1255;
FRBNY Voicemail: (212) 720-5069
Blackberry: (718) 612-3095
BOG-- FOIA 10-251 --000814

From: Bart Simon
To: Diane Fraser; Elise Liebers
Cc: Cynthia L Martin; Kimberly A DeTrask; Stacy L Coleman
Subject: AIG - other factors
Date: 09/15/2008 06:17 PM
After some brief conversations with senior insurance brokers at (b) (4)
P&C
- Neither have made a concrete decision on whether or not AIG is still a viable
market for their clients. Both did say that most clients that are in renewal of a 10/1
inception date have asked for alternative quotes and have indicated a strong
preference for the alternative. 12/31s have also asked for alternatives.
- They may consider stalling any additional LOCs or payments on loss sensitive
programs until more market clarity is available.
- Both are highly reliant on rating agencies determination.
Surety Bonds
- AIG is leading provider of surety bond for construction, infrastructure,
homebuilders, etc. I believe that many contracts require a minimum insurer rating
on surety bond (BBB?). Should the AIG company that provides these bonds fall
below that, a significant # of projects will be in technical default. I'm not sure what
the process is for unwinding this.
Across risks
- b4 ndicated that for nonfinancial firms this was a large wake-up call. Many
companies use AIG on all (many) parts of their program including P&C, 401(k),
surety bonds, life insurance programs, etc. It is these smaller companies that the
brokers have concern over. The larger companies may spread business and/or may
loose only one part of their program. Smaller companies may have a lot of due
diligence to do to replace the various services provided by AIG.
- Both highlighted that their clients have been commenting on the regulatory
structure. It was a wake-up call here as well.
_________________________
Bart Simon
600 Atlantic Avenue
Boston, Massachusetts 02210
(617) 973-3231
Mailing address:
Post Office Box 55882
BOG-- FOIA 10-251 --000815

From: Hasan Latif
Cc: Dennis Ryan; Adrian Lawrence
Subject: SG Market Risk Update 9/15
Date: 09/15/2008 06:18 PM
Restricted FR
Market Risk Update for 9/15/08

Not Responsive
(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000816

(b) (4) and (b) (8)
BOG-- FOIA 10-251 --000817

From: Nancy R Berlad
Cc: BSR LIG
Subject: Fw: Citi Counterparty Update 9-15-08 PM
Date: 09/15/2008 06:26 PM
Cory,
The key issues indicated in the email below:
AIG
(b) (4) and (b) (8)
Duplicate
BOG-- FOIA 10-251 --000818

From: Jack Jennings
To: Roger Cole; Deborah P Bailey; Coryann.Stefannson@frb.gov
Bcc: Richard.Naylor@frb.gov
Subject: Summary of Foreign Supervisors Call, September 15, 4:00 p.m.
Date: 09/15/2008 06:26 PM
Summary of Foreign Supervisors Call, September 15, 4:00 p.m.
Participants
US - Board, FRBNY, SEC, CFTC

UK - FSA, BOE
Swiss - EBK
Germany - Bundesbank, BaFin
France - Commission Bancaire
Japan - FSA
Hong Kong - HK Securities and Futures Commission
Not Responsive
BOG-- FOIA 10-251 --000819

Not Responsive
(b) (4)
Not Responsive
Jack P. Jennings, II
Associate Director
International Supervision, Training and Assistance
Division of Banking Supervision and Regulation
Phone: (202) 452-3053
Fax: (202) 452-2770
Email: jack.jennings@frb.gov
BOG-- FOIA 10-251 --000820

Cc: Daniel M Covitz; Gustavo A Suarez; JNellie Liang; William B English
Subject: Re: AIG subs CP
Date: 09/15/2008 06:26 PM
I was on a phone call with FRBNY and NYSID just now, they said AIG's CP did not
roll today.
Mike
▼ Gustavo A Suarez/BOARD/FRS
Gustavo A
Suarez/BOARD/FRS
To JNellie Liang/BOARD/FRS@BOARD, William B
English/BOARD/FRS@BOARD, Michael S
Gibson/BOARD/FRS@BOARD, Daniel M
cc Gustavo A Suarez/BOARD/FRS@BOARD
Subject AIG subs CP
Duplicate
BOG-- FOIA 10-251 --000821

From: Peter DeMontravel
Cc: Pat Soriano; John Harvey; Taitu Wondwosen; Paula Premo; Peter DeMontravel; Om Arya; Jane Wakefield;
Lucette Pecoraro
Subject: Deutsche Bank - Treasury Liquidity Meeting - 3 PM
Date: 09/15/2008 06:28 PM
Attachments: Deutsche Liquidity Meeting at 3 PM.9.15.doc
Please see the attached prepared by Peter DeMontravel and Paula Premo
Peter DeMontravel
peter.demontravel@ny.frb.org
212-720-2017
BOG-- FOIA 10-251 --000822

Restricted F.R.
Liquidity Meeting at 3 PM with Deutsche Bank’s Treasury

September 15, 2008
• Not Responsive
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000823

Restricted F.R.
Not Responsive
BOG-- FOIA 10-251 --000824

To: Jon D Greenlee
Cc: Sabeth I Siddique; Adrienne Haden; Nina Nichols
Subject: Re: Update on where we stand with id of other weak firms?
Date: 09/15/2008 06:30 PM
Attachments: Results of Risk Area Barin storm to id institutions 9-15-08.pdf
Attached are staff briefing points on their activities today to identify institutions in
various sectors that may be impacted by the Lehman or AIG "events". The objective
was to identify names for ongoing monitoring.
Jim Embersit
202-452-5249
Jon D
Greenlee/BOARD/FRS
Embersit/BOARD/FRS@BOARD
cc
09/15/2008 05:57 PM
Subject Update on where we stand with id of other weak
firms?
Jon Greenlee
Associate Director
Phone (202) 452-2962
BOG-- FOIA 10-251 --000825

RESTRICTED FR
NOTES ON RISK, September 15, 2008
Regional Investment Brokerage Firms
The Yahoo Finance regional investment brokerage firm index was down 3.69% for the day. However, the regional
brokerage firms fared better than the two remaining large brokers. Goldman and Morgan were each down over
12%.
BlackRock, Inc., the largest firm in the index with a market capitalization of $27 billion, was only down about 1
percent on the day accounting for much of the good performance compared to the larger firms. Investors believe
BlackRock will benefit from Lehman’s dissolution.
In addition, the regional firms may not be as heavily reliant on overnight funding as the larger firms and probably
do not keep complex structured products in inventory to the extent that the larger firms have.
There are no indications at this time that the regional brokerage firms, as a whole, are going to come under
pressure. However, a few have already encountered financial difficulty, such as ETrade and these problems have
been well known for some time.
The table below highlights capitalization and stock price changes for the regional brokerage firms:
Change
Capitalization from
Firm Symbol (billions) Price 09/12/08
Yahoo Regional Brokerage Index ^YHOh761 NA 851.82 -3.69%
Select firms within the index
BlackRock, Inc. BLK $ 27.4 $ 201.00 -0.99%
TD Ameritrade AMTD 11.6 19.64 -3.68%
Legg Mason LM 5.3 37.13 -7.90%
Raymond James Company RJF 3.7 30.31 -2.73%
Jefferies Group JEF 2.8 17.46 1.45%
Waddell & Reed WDR 2.2 25.93 -3.71%
Greenhill& Company GHL 1.8 65.99 3.06%
Etrade Financial ETFC 1.6 2.98 -9.70%
Knight Captial Group NITE 1.4 15.41 -6.38%
Friedman Billings Ramsey FBR 0.3 1.55 -9.88%
$ 58.0 $ 417.40
Large Brokerage Firms

Goldman Sachs GS 51.5 135.50 -12.13%
Morgan Stanley MS 34.8 32.19 -13.54%
B. Valenti
BOG-- FOIA 10-251 --000826

Comparison of Morgan Stanley and Goldman Sachs CRE and Consumer Mortgage Paper
MS GS
CRE $ 22.0 $ 17.0
Alt-A 12.0 4.7
Prime na 8.6
Leveraged Loans 13.0 19.0
Total: 47.0 49.3
Capital: $ 34.5 $ 44.8
Percent of Capital 136% 110%
B. Valenti
Status of Insurance Industry
The current problems of AIG, the financial guarantors, and the private mortgage insurers are well known. This note
provides a quick update on the financial conditions of other insurance companies.
U.S. insurance companies are typically highly invested in the mortgage markets, especially commercial real estate.
Large U.S. insurance companies that have a substantial percentage mortgages in their invested assets include:
Nationwide (22.4%); CIGNA (21.2%); Thrivent (16.6%); Genworth (16.1%); Principal Financial (16.1%); and
MassMutual (16.0%). For comparison, AIG had mortgages that comprised 15.4% of its invested assets.
Residential Subprime and Alt A exposures constituted a high percentage of AIG’s equity (47%). Most insurance
companies are more exposed to commercial mortgages than residential. Some other insurance companies with high
exposures to residential mortgages included CNA (22.7%) and The Hartford (13.4%).
Insurance companies’ exposures to the CDS markets are difficult to pin down. Some evidence suggests that the
most exposed are Metlife (a financial holding company), Principal Financial, Prudential, and The Hartford. This is
in addition to the financial guarantors’ substantial exposures to credit markets.
The largest reinsurance companies seem to be in good financial shape, although they have significant declines in
profitability. The exceptions are Scottish Re, which has substantial exposure to U.S. subprime, and Bluepoint Re,
which reinsured financial guarantors. Other reinsurers are parts of larger groups with financial guarantors or
mortgage insurers and may face downgrades (Assured Guaranty, RAM Re, XL Capital, Radian Group).
D. Fraser
BOG-- FOIA 10-251 --000827

Impact of Recent Financial Turmoil on Pension Funds
• No major immediate concerns are anticipated for pension funds; however; however, heightened concerns
arising from recent market events may prompt pension funds (and other fiduciaries) to selectively redeem
investments in those money market funds and “stable value” funds deemed to be more vulnerable to
liquidity or credit issues to protect their investment.
• In the longer term, effects of markdowns of pension assets may cause a plan to be underfunded, requiring a
need to make additional plan contributions. 1
• On the positive side, in aggregate, at 2007, private pension plans were fully funded; however, there have
likely been significant write-downs in fund assets since that time. According to reports, asset values of
pension funds of the top 1500 S&P companies have declined an estimated $50 - $80 billion from $1.7
trillion level at year-end 2007.
• The U.S. pension industry assets totaled approximately $6 trillion at year-end 2007, comprised of
approximately $2.6 trillion of private plan assets and $3.4 trillion of public plan assets.
Impact of Recent Financial Turmoil on Money Market Funds
• Money market funds and “stable value” funds will again be under pressure to avoid “breaking the buck.”
Liquidity and valuation issues are likely to become an issue. Banks sponsored funds are being monitoring
by the LCBO group. (See attached listing of largest money market funds and bank advised funds.)
B. Cornyn
1
Most ERISA plans are required to provide audited financials. FAS 35 requires assets to be reported at fair value.
The weakening of the PBGC’s financial condition following the stock market decline in 2001, was a driver of the
reform implemented with the Pension Protection Act of 2006, which brought about higher funding requirements;
faster closure of funding gaps; and greater use of market-to-market valuations.
BOG-- FOIA 10-251 --000828

Update on the Commercial Paper Market, September 15, 2008
• Market is for overnight paper. Term paper is not trading in any sector, that is, for 30, 60 or 90 day paper.
• Money market funds are worried about redemptions and therefore, they are holding off purchasing until the
end the day as opposed to purchasing in the morning.
• Elimination of Merrill and Lehman as dealers should not impact liquidity in the market as issuers direct
their commercial paper to other dealers.
• Reported draws on bank lines by issuers who did not place their full allotment of commercial paper.
• The ABCP market is beginning to struggle. Overnight paper is difficult to place for independent issuers and
foreign multi-seller ABCP conduits. Term paper did not trade.
• Fed Funds hit 8%. The expectation is that demand will return to the market for longer term paper as credit
fears subside.
• US Bank spreads remained relatively unchanged, however, few trades were completed
o Foreign banks could only fund overnight
• In the corporate market, funding was overnight with no demand for term paper.
L. Rufrano
BOG-- FOIA 10-251 --000829

CDS Spreads widened last week for AIG, as well as for A-rated insurers and FGIC.
Note that Genworth, rated A, has CDS spreads comparable to BBB insurors
CDS Spreads for AIG
9/15/08 -12pm
1468.24
1600
1400
1200
1000
800
600
400
200
CDS Spreads for AA Securities
3000
2500
2000
AMBAC
1500 MBIA
Swiss Re
1000
500
BOG-- FOIA 10-251 --000830

CDS Spreads for A Rated Securities
450
400
350
300
Genworth
Prudential
250
MetLife
Hartford
200 XL
Loews
150
100
50
CDS Spreads for BBB & CCC Rated Securities
5000
4500
4000
3500
MGIC
3000
Assurant
CNA
2500
PMI
Unitrin
2000
FGIC
1500
1000
500
D. Gabbai
BOG-- FOIA 10-251 --000831

Not Responsive
J. Colwell
BOG-- FOIA 10-251 --000832

To: Patricia Mosser; Adam Ashcraft; Alejandro LaTorre; Alexa Philo; Alexander J Psomas; Azish Filabi; Bard
Stermasi; Brian Begalle; Catherine Voigts; Christopher Calabia; Danielle Vicente; Denise Goodstein; Dianne
Dobbeck; Elise Liebers; Erika Gottfried; Gerard Dages; Jim Mahoney; Jonathan Polk; Kevin Coffey; Mari Baca;
Mark Scapp; Min Kim; Niall E Coffey; Paul Whynott; Richard Charlton; Tobias Adrian; Zoltan Pozsar; Michael S
Gibson; Jon D Greenlee
Subject: Re: AIG info
Date: 09/15/2008 06:32 PM
For FRBNY: no briefing for Tim. He's left for DC --FOMC meeting tomorrow. I'll send
info when I get it.
-----------------------------
▼ Patricia Mosser

Sent: 09/15/2008 04:18 PM EDT
To: Adam Ashcraft; Alejandro LaTorre; Alexa Philo; Alexander Psomas;
Azish Filabi; Bard Stermasi; Brian Begalle; Catherine Voigts; Christopher
Calabia; Danielle Vicente; Denise Goodstein; Dianne Dobbeck; Elise Liebers;
Erika Gottfried; Gerard Dages; Jim Mahoney; Jonathan Polk; Kevin Coffey;
Mari Baca; Mark Scapp; Min Kim; Niall Coffey; Patricia Mosser; Paul Whynott;
Richard Charlton; Tobias Adrian; Zoltan Pozsar; Michael Gibson; Jon Greenlee
Subject: AIG info
----- Forwarded by Patricia Mosser/NY/FRS on 09/15/2008 04:14 PM -----
"Swift, Christopher"
<Christopher.Swift@aig.com>
To "'HFiner@ins.state.ny.us'"
Sent by: "Turco, Antonia"
<HFiner@ins.state.ny.us>, Patricia Mosser
<Antonia.Turco@aig.com>
<Patricia.Mosser@ny.frb.org>,
cc JKenny@ins.state.ny.us,
KBrooks@ins.state.ny.us, Joseph Fritsch
09/15/2008 03:11 PM <JFritsch@ins.state.ny.us>,
MMoriart@ins.state.ny.us, Robert Easton
<REaston@ins.state.ny.us>, Dennis Fernez
<DFernez@ins.state.ny.us>, "Swift,
Christopher" <Christopher.Swift@aig.com>
Subject RE: contacts
Duplicate
BOG-- FOIA 10-251 --000833

To: Patricia Mosser
Cc: Adam Ashcraft; Alexa Philo; Alexander J Psomas; Azish Filabi; Bard Stermasi; Brian Begalle; Catherine Voigts;
Christopher Calabia; Danielle Vicente; Denise Goodstein; Dianne Dobbeck; Elise Liebers; Erika Gottfried; Gerard
Dages; Jim Mahoney; Jon D Greenlee; Jonathan Polk; Kevin Coffey; Mari Baca; Mark Scapp; Michael S Gibson;
Min Kim; Niall E Coffey; Patricia Mosser; Paul Whynott; Richard Charlton; Tobias Adrian; Zoltan Pozsar
Date: 09/15/2008 06:34 PM
He just called me an asked for a briefing later tonight - we think 10-10:30. Just got
the call 5min ago.
Patricia
Mosser/NY/FRS
To Patricia Mosser/NY/FRS@FRS, Adam
Ashcraft/NY/FRS@FRS, Alejandro
LaTorre/NY/FRS@FRS, Alexa Philo/NY/FRS@FRS,
09/15/2008 06:36 PM Alexander J Psomas/NY/FRS@FRS, Azish
Filabi/NY/FRS@FRS, Bard Stermasi/NY/FRS@FRS,
Brian Begalle/NY/FRS@FRS, Catherine
Voigts/NY/FRS@FRS, Christopher
Calabia/NY/FRS@FRS, Danielle Vicente/NY/FRS@FRS,
Denise Goodstein/NY/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS, Elise Liebers/NY/FRS@FRS,
Erika Gottfried/NY/FRS@FRS, Gerard
Dages/NY/FRS@FRS, Jim Mahoney/NY/FRS@FRS,
Jonathan Polk/NY/FRS@FRS, Kevin
Coffey/NY/FRS@FRS, Mari Baca/NY/FRS@FRS, Mark
Scapp/NY/FRS@FRS, Min Kim/NY/FRS@FRS, Niall E
Coffey/NY/FRS@FRS, Paul Whynott/NY/FRS@FRS,
Richard Charlton/NY/FRS@FRS, Tobias
Adrian/NY/FRS@FRS, Zoltan Pozsar/NY/FRS@FRS,
Michael S Gibson/BOARD/FRS@BOARD, Jon D
cc
Subject
Re: AIG info
Duplicate
BOG-- FOIA 10-251 --000834

To: Alejandro LaTorre
Cc: Adam Ashcraft; Alexa Philo; Alexander J Psomas; Azish Filabi; Bard Stermasi; Brian Begalle; Catherine Voigts;
Christopher Calabia; Danielle Vicente; Denise Goodstein; Dianne Dobbeck; Elise Liebers; Erika Gottfried; Gerard
Dages; Jim Mahoney; Jon D Greenlee; Jonathan Polk; Kevin Coffey; Mari Baca; Mark Scapp; Michael S Gibson;
Min Kim; Niall E Coffey; Paul Whynott; Richard Charlton; Tobias Adrian; Zoltan Pozsar
Date: 09/15/2008 06:35 PM
10 pm then?
-----------------------------
▼ Alejandro LaTorre

Sent: 09/15/2008 06:37 PM EDT
To: Patricia Mosser
Cc: Adam Ashcraft; Alexa Philo; Alexander Psomas; Azish Filabi; Bard
Stermasi; Brian Begalle; Catherine Voigts; Christopher Calabia; Danielle
Vicente; Denise Goodstein; Dianne Dobbeck; Elise Liebers; Erika Gottfried;
Gerard Dages; Jim Mahoney; Jon Greenlee; Jonathan Polk; Kevin Coffey; Mari
Baca; Mark Scapp; Michael Gibson; Min Kim; Niall Coffey; Patricia Mosser;
Paul Whynott; Richard Charlton; Tobias Adrian; Zoltan Pozsar
Duplicate
BOG-- FOIA 10-251 --000835

From: JNellie Liang
Cc: Daniel M Covitz; Gustavo A Suarez; Michael S Gibson; William B English
Date: 09/15/2008 06:37 PM
Do you know if dealers took any or is it all on AIG?
Michael S
Gibson/Board/FRS
To Gustavo A Suarez/BOARD/FRS@BOARD
Sent by: Michael S
Gibson/BOARD/FRS cc Daniel M Covitz/BOARD/FRS@BOARD, Gustavo A
Suarez/BOARD/FRS@BOARD, JNellie
Liang/BOARD/FRS@BOARD, William B
Subject
09/15/2008 06:26 PM Re: AIG subs CP
I was on a phone call with FRBNY and NYSID just now, they said AIG's CP did not
roll today.
Mike
Duplicate
BOG-- FOIA 10-251 --000836

From: Timothy Carlin
Cc: Stephanie Chaly; Linda Rodriguez; Nirali Deringer; Yogesh Shah; Christopher Hunter
Subject: Barclays Ops Update
Date: 09/15/2008 06:59 PM
RESTRICTED FR
Barclays Operational Update

FRBNY: Tim Carlin, Linda Rodriguez, Nirali Deringer
Barclays: John Rodefeld US Head of Operations
(b) (4) and (b) (8)
Thanks
Tim
BOG-- FOIA 10-251 --000837

From: James Wall
Cc: William Charwat; Jeanmarie Davis; Brian Begalle; Genevievette.E.Walker@frb.gov
Subject: Fw: Consolidated BNYM CPC Team 9/15 Recap
Date: 09/15/2008 07:20 PM
As requested, here are the consolidated bullets from the BNYM CPC team.
BNYM Morning Updates

Not Responsive
(b)(4) & (b)(8)
Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000838

Not Responsive
BNYM End of Day Updates

(b)(4) & (b)(8)
Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000839

Not Responsive
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000840

Subject: today's update
Date: 09/15/2008 07:43 PM
Hard copies en route.
202-530-6285
BOG-- FOIA 10-251 --000841

Foreign payment and settlement infrastructures

Not Responsive
Page 1 of 3 1
BOG-- FOIA 10-251 --000842
Not Responsive
(b) (4)
Not Responsive
Not Responsive
Page 2 of 3 2
BOG-- FOIA 10-251 --000843
Not Responsive
Page 3 of 3 3
BOG-- FOIA 10-251 --000844
From: Moses Cheng
Subject: DB September 15, 2008 Credit Risk Management Update 2
Date: 09/15/2008 07:57 PM
**Restricted FR**
Prepared by Tai Wondwosen and Moses Cheng

(b)(4) & (b)(8)
Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000845

Not Responsive
*************************************
212-720-1433
212-250-6075
BOG-- FOIA 10-251 --000846

From: Kevin Warsh
To: (b) (6) Donald L Kohn
Cc: Michelle A Smith
Subject: AIG
Date: 09/15/2008 08:05 PM
Received report tonight on capital hole at AIG; far worse than expected; hole too big
to be filled, according to (b) (4) . Not good.
BOG-- FOIA 10-251 --000847

To: Kevin Warsh; (b) (6) ; Donald L Kohn; Brian F Madigan
Subject: Re: AIG
Date: 09/15/2008 08:25 PM
Just spoke to TFG. (b) (5)

(b) (5)
▼ Kevin Warsh

From: Kevin Warsh
Sent: 09/15/2008 08:05 PM EDT
To: (b) (6) Donald Kohn
Cc: Michelle Smith
Duplicate
BOG-- FOIA 10-251 --000848

From: Rita C Proctor
To: (b) (6)
Subject: Fw: Foreign Bank Supervisors call
Date: 09/15/2008 08:30 PM
Deborah P
Bailey/BOARD/FRS
To Rita C Proctor/BOARD/FRS@BOARD, Randall S
Kroszner/BOARD/FRS@BOARD, Elizabeth A
Duke/BOARD/FRS@BOARD, Donald L
09/15/2008 07:19 PM Kohn/BOARD/FRS@BOARD, Kevin
cc Scott Alvarez/BOARD/FRS@BOARD, Brian F
Madigan/BOARD/FRS@BOARD
Subject Foreign Bank Supervisors call
Duplicate
BOG-- FOIA 10-251 --000849

Subject: lehman update draft
Date: 09/15/2008 08:33 PM
202-530-6285
BOG-- FOIA 10-251 --000850


Not Responsive
(b)(4) & (b)(8)
Not Responsive
Page 1 of 3 1
BOG-- FOIA 10-251 --000851
Not Responsive
Page 2 of 3 2
BOG-- FOIA 10-251 --000852
Not Responsive
Page 3 of 3 3
BOG-- FOIA 10-251 --000853
Cc: Donald L Kohn; (b) (6) ; Kevin Warsh; Scott Alvarez
Subject: Re: AIG
Date: 09/15/2008 08:47 PM
Here are my thoughts.

(b) (5)
Michelle A
Smith/BOARD/FRS
To Kevin Warsh/BOARD/FRS@BOARD, (b) (6)
Donald L
Kohn/BOARD/FRS@BOARD, Brian F
09/15/2008 08:25 PM Madigan/BOARD/FRS@BOARD
cc
Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000854

To: Brian F Madigan
Cc: Donald L Kohn; (b) (6) ; Kevin Warsh; Scott Alvarez
Subject: Re: AIG
Date: 09/15/2008 08:59 PM
Latest...
(b) (5)
-m
▼ Brian F Madigan

Sent: 09/15/2008 08:47 PM EDT
To: Michelle Smith
Cc: Donald Kohn; (b) (6) Kevin Warsh; Scott Alvarez
Subject: Re: AIG
Here are my thoughts.
Duplicate
BOG-- FOIA 10-251 --000855

To: JNellie Liang
Subject: Re: Fw: Difficulties with money fund redemptions
Date: 09/15/2008 09:03 PM
No, but no surprise there. Pat

From: JNellie.Liang
Sent: 09/15/2008 09:00 PM AST
Subject: Re: Fw: Difficulties with money fund redemptions
thanks.
I assume you heard that AIG's CP did not roll today.
Nellie
Patrick.M.Parkins
on@frb.gov
To
09/15/2008 08:36 "Brian Madigan"
PM <brian.f.madigan@frb.gov>, "Nellie
Liang"
<JNellie.Liang@frb.gov>
cc
Subject
Fw: Difficulties with money fund
redemptions
Fyi.

From: David.Marshall
Sent: 09/15/2008 08:37 PM AST
To: Pat White; Patrick Parkinson; Patricia Mosser
Subject: Difficulties with money fund redemptions
Not Responsive
BOG-- FOIA 10-251 --000856

Cc: Donald L Kohn; (b) (6) ; Kevin Warsh; Scott Alvarez; Brian F Madigan
Subject: Re: AIG
Date: 09/15/2008 09:05 PM
Scott and I just spoke by phone. (b) (5)
Michelle A
Smith/BOARD/FRS
cc Donald L Kohn/BOARD/FRS@BOARD, (b) (6)
Kevin
09/15/2008 08:59 PM Warsh/BOARD/FRS@BOARD, Scott
Subject
Re: AIG
Duplicate
BOG-- FOIA 10-251 --000857

From: Scott Alvarez
Subject: Re: AIG
Date: 09/15/2008 09:06 PM
(b) (5)
Scott
--------------------------

Sent: 09/15/2008 08:59 PM EDT
To: Brian Madigan
Cc: Donald Kohn; (b) (6) ; Kevin Warsh; Scott Alvarez
Duplicate
BOG-- FOIA 10-251 --000858

To: (b) (6) Donald L Kohn; Kevin Warsh; Brian F Madigan; Scott Alvarez
Subject: S and P cuts AIG's credit rating...
Date: 09/15/2008 09:26 PM
NEWS ALERT
from The Wall Street Journal
Sept. 15, 2008
Monday evening, Standard & Poor's cut AIG's credit rating by three notches. The
downgrade means that AIG's counterparties can demand that it post an additional
$11.6 billion in collateral, according to a filing AIG made with the Securities and
Exchange Commission in August. It is not clear how quickly AIG would have to
produce those funds, but if it fails to do so, it risks defaulting on its agreements with
those counterparties.
BOG-- FOIA 10-251 --000859

From: Donald L Kohn
To: Scott Alvarez; Patrick Parkinson
Subject: Fw: AIG
Date: 09/15/2008 09:38 PM
(b) (5)
--------------------------
▼ Kevin Warsh

From: Kevin Warsh
Sent: 08:05 PM EDT
To: (b) (6) Donald Kohn
Cc: Michelle Smith
Subject: AIG
Duplicate
BOG-- FOIA 10-251 --000860

To: Brian Peters
Subject: What was the outcome of the aig meeting?
Date: 09/15/2008 11:58 PM
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
BOG-- FOIA 10-251 --000861

To: Brian Peters
Subject: Re: What was the outcome of the aig meeting?
Date: 09/16/2008 12:09 AM
Any...starved for info :)

Coryann Stefansson
Associate Director
Work # 2
Cell # (b) (6)

From: Brian Peters
Sent: 09/16/2008 12:12 AM EDT
Our internal discussion or the industry? Both still ongoing to my knowledge.
Duplicate
BOG-- FOIA 10-251 --000862

To: Brian Peters
Date: 09/16/2008 12:21 AM
(b) (5)
Coryann Stefansson
Associate Director
Work # 2
Cell # (b) (6)

From: Brian Peters
Sent: 09/16/2008 12:17 AM EDT
We are still debating with TFG. A group with Dianne and Stev and wlr
directing are estimating the economic effects on the market. Some bankers
seem to still be downstarirs as tFG keeps popping out.

Sent: 09/16/2008 12:09 AM EDT
To: Brian Peters
Duplicate
BOG-- FOIA 10-251 --000863

Coryann Stefansson
Associate Director
Work #
Cell # (b) (6)
BOG-- FOIA 10-251 --000864

From: Robert.Hoyt@do.treas.gov
To: Dan.Jester@do.treas.gov; Jeremiah.Norton@do.treas.gov; Neel.Kashkari@do.treas.gov;
David.McCormick@do.treas.gov; Tony.Ryan@do.treas.gov; Scott.Alvarez@frb.gov; Timothy.Geithner@ny.frb.org
Subject: Fw: Use of existing Authority
Date: 09/16/2008 12:47 AM
Attachments: Use of existing Authority.doc
From: Bob Hoyt

To: Hoyt, Robert
Sent: Tue Sep 16 00:43:26 2008
Subject: Use of existing Authority
(b) (5)
····· - Use of existing Authority.doc
BOG-- FOIA 10-251 --000865

(b) (5)
BOG-- FOIA 10-251 --000866

From: (b) (4)
Sent By:
To: James.A.Clouse@frb.gov
Subject: Few things
Date: 09/16/2008 06:05 AM
It seems many in the market were not at all prepared for Lehman to go under. Most
expected some form of takeover or bail out (maybe not the most irrational of beliefs
given Bear Stearns and the potential for serious systemic risk).
A lot of funds facing Lehman have seen significant losses incurred on collateral on
repo’s, swaps, etc. There are also many with uncertain overall positions as a result of
uncertainty over current trades with Lehman.
Given that the UShas now showed a willingness to let a major institution fail, there is
widespread concern about many other names, and an increasing unwillingness to
lend or trade with other counterparties.
I have heard a number of funds raise concerns about whether the Merrill/BoA deal
with conclude (people who’ve just incurred serious losses on Lehman exposures are
inclined to take a negative view of things).
Similarly AIG is causing high concern – the extent of losses which would be
transmitted to the banking system through a failure is seen as a very high risk.
The money markets and FX forward markets are becoming increasingly dislocated –
US$ overnight rates being quoted somewhere between 10+20% at present.
BOG-- FOIA 10-251 --000867

Credit spreads across the board are continuing to blow out, and liquidity is extremely
poor.
The very very high risk decision to let Lehman fail seems to be triggering a loss of
confidence in policy makers ability to understand or fix the current problems (at least
in the US). If this runs much further or there are other major defaults this situation
could be difficult to pull back.
I would not rule out the need for the US or even G7 to issue a generalized guarantee
on all senior bank obligations if this situation gets further out of hand to prevent a
major systemic breakdown in the banking and payments system.
Feel free to give me a shout for further.

(b) (4)
(b) (4)
BOG-- FOIA 10-251 --000868

From: (b) (6)
To: Michelle A Smith; Kevin Warsh
Subject: Re: S and P cuts AIG's credit rating...
Date: 09/16/2008 06:19 AM
(b) (5)
--------------------------

Sent: 09/15/2008 09:26 PM EDT
To: (b) (6) ; Donald Kohn; Kevin Warsh; Brian Madigan; Scott
Alvarez
Subject: S and P cuts AIG's credit rating...
NEWS ALERT
from The Wall Street Journal
Sept. 15, 2008
Monday evening, Standard & Poor's cut AIG's credit rating by three
notches. The downgrade means that AIG's counterparties can demand
that it post an additional $11.6 billion in collateral, according to a filing
AIG made with the Securities and Exchange Commission in August. It
is not clear how quickly AIG would have to produce those funds, but if
it fails to do so, it risks defaulting on its agreements with those
counterparties.
BOG-- FOIA 10-251 --000869

From: Kevin Warsh
To: Donald L Kohn
Subject: Fw: S and P cuts AIG's credit rating...
Date: 09/16/2008 06:28 AM
----------------------------------------------------------------------------
----

From: (b) (6)
Sent: 09/16/2008 06:19 AM AST
To: Michelle Smith; Kevin Warsh
Duplicate
BOG-- FOIA 10-251 --000870

From: Donald L Kohn
To: Kevin Warsh
Date: 09/16/2008 06:37 AM
We already were supposed to have an u ure that

gets scheduled and that bb is on it. (b) (5)
(b) (5)
--------------------------

From: Kevin.Warsh
Sent: 09/16/2008 06:28 AM AST
To: Donald Kohn
----------------------------------------------------------------------------
----
----- age -----

From: (b) (6)
Sent: 09/16/2008 06:19 AM AST
Duplicate
BOG-- FOIA 10-251 --000871

To: (b) (6)
Date: 09/16/2008 06:39 AM
BB would like to get an update before thew mtg. Do ypu want me to

put tgether a 5 min call at 8 or 815?
Good luck.
▼ (b) (6)

From: (b) (6)
Sent: 09/16/2008 06:19 AM EDT
Duplicate
BOG-- FOIA 10-251 --000872

To: (b) (6)
Date: 09/16/2008 06:53 AM
(b) (6)
Done
▼

From: (b) (6)
Sent: 09/16/2008 06:19 AM EDT
Duplicate
BOG-- FOIA 10-251 --000873

From: (b) (4)
Sent By:
To: sheetsn@frb.gov
Subject: problem
Date: 09/16/2008 07:26 AM
I really think you have a major problem here.
Lehman failure has set of a huge set of chain reactions across markets causing
leverage to unwind in a disorderly manner. Many funds/corporates/hedge funds can’t
work out their positions and are scrambling to replace naked exposures created by
the failure. There seem to be differences in treatment for the unwind depending on
instruments, etc causing chaos for market exposures.
The ETF market is being shut down by the AIG problems.
The USsenior bank debt market is collapsing due to the collapse in recovery rate
assumptions as more failures are considered.
Most important is the collapse in confidence in the policymaker community among

market participants. It was a choice to let Lehman fail and trigger this situation.
The market is very close to seizing. Many market participants are close to a moving
towards short dated government bonds and avoiding bank exposure (in every way a
major run on the banking system).
There may well be a need to issue a general guarantee on bank obligations in the
manner the Scandanavian’s did in 2002 and the UK did for a short period during
BOG-- FOIA 10-251 --000874

Northern Rock’s collapse to prevent the payments system collapsing in the next few
hours.
(b) (4)

(b) (4)
BOG-- FOIA 10-251 --000875

From: Margaret Owens
To: Kevin Warsh
Subject: Fw: Few things
Date: 09/16/2008 07:40 AM
----- Forwarded by Margaret Owens/BOARD/FRS on 09/16/2008 07:39 AM -----
(b) (4)
To <Margaret.Owens@frb.gov>
cc
Subject Few things
09/16/2008 06:35 AM
Hi – would you be able to pass this to Gov Warsh for me please? Thanks,(b) (4)

It seems many in the market were not at all prepared for Lehman to go under. Most
expected some form of takeover or bail out (maybe not the most irrational of beliefs
given Bear Stearns and the potential for serious systemic risk).

A lot of funds facing Lehman have seen significant losses incurred on collateral on
repo’s, swaps, etc. There are also many with uncertain overall positions as a result of
uncertainty over current trades with Lehman.

Given that the US has now showed a willingness to let a major institution fail, there is
widespread concern about many other names, and an increasing unwillingness to
lend or trade with other counterparties.

I have heard a number of funds raise concerns about whether the Merrill/BoA deal
with conclude (people who’ve just incurred serious losses on Lehman exposures are
inclined to take a negative view of things).

Similarly AIG is causing high concern – the extent of losses which would be
transmitted to the banking system through a failure is seen as a very high risk.

The money markets and FX forward markets are becoming increasingly dislocated –
US$ overnight rates being quoted somewhere between 10+20% at present.
BOG-- FOIA 10-251 --000876

Credit spreads across the board are continuing to blow out, and liquidity is extremely
poor.

The very very high risk decision to let Lehman fail seems to be triggering a loss of
confidence in policy makers ability to understand or fix the current problems (at least
in the US). If this runs much further or there are other major defaults this situation
could be difficult to pull back.

I would not rule out the need for the US or even G7 to issue a generalized guarantee
on all senior bank obligations if this situation gets further out of hand to prevent a
major systemic breakdown in the banking and payments system.

Feel free to give me a shout for further.
(b) (4)
(b) (4)
BOG-- FOIA 10-251 --000877

From: Patrick E McCabe
To: Patrick Dwyer
Subject: AIG & MMFs?
Date: 09/16/2008 07:47 AM
Patrick:
Any news on the AIG situation as it affects MMFs? (b) (5)
-Patrick
▼ Patrick Dwyer/NY/FRS@FRS
Patrick
Dwyer/NY/FRS@FRS
To Patrick E McCabe/BOARD/FRS@BOARD
cc
09/15/2008 02:35 PM Subject Fw: dmm for pm
from our 1:30 rundown:

----- Forwarded by Patrick Dwyer/NY/FRS on 09/15/2008 02:34 PM -----
Patrick
Dwyer/NY/FRS
To Kenneth Forgit/NY/FRS, Matthew Lieber/NY/FRS, Jason
Miu/NY/FRS, Michelle Steinberg/NY/FRS
cc Steven Friedman/NY/FRS@FRS, Peggy
09/15/2008 01:23 PM Kauh/NY/FRS@FRS, NY MKT DMM Staff, Seth B
Carpenter/BOARD/FRS@BOARD
Subject dmm for pm
Not Responsive
BOG-- FOIA 10-251 --000878

Not Responsive
BOG-- FOIA 10-251 --000879

From: JNellie Liang
To: Gustavo A Suarez; Daniel M Covitz
Date: 09/16/2008 07:56 AM
I suspect that AIG's CP backup lines have MAC clauses, and that AIG now has a
serious problem. I would like to consolidate the info you have put together on AIG's
programs and give a short memo to BB today. Let's get the story about any rates
paid on their CP yesterday.
Nellie
Michael S
Gibson/Board/FRS
To JNellie Liang/BOARD/FRS@BOARD
Sent by: Michael S
Gibson/BOARD/FRS cc
Subject
Re: AIG subs CP
09/15/2008 07:21 PM
They didn't say. It is my understanding that the CP has bank backup lines, though
the ABCP does not.
Mike
▼ JNellie Liang/BOARD/FRS
JNellie
Liang/BOARD/FRS
cc Daniel M Covitz/BOARD/FRS@BOARD, Gustavo A
Suarez/BOARD/FRS@BOARD, Michael S
09/15/2008 06:37 PM Gibson/BOARD/FRS@BOARD, William B
Subject
Re: AIG subs CP
Duplicate
BOG-- FOIA 10-251 --000880

From: JNellie Liang
Cc: Daniel M Covitz; Gustavo A Suarez; Michael S Gibson; JNellie Liang
Date: 09/16/2008 08:03 AM
Gustavo,
If I have it right by combining this info with previous data, AIG and subs have six
programs with $17.9 billion. $6 billion or one-third is due to mature in 7 days (5
business days?). Mike tells us that NY said that their paper did not roll yesterday.
Nellie
Gustavo A
Suarez/BOARD/FRS
Subject AIG subs CP
Duplicate
BOG-- FOIA 10-251 --000881

From: Roberto Perli
To: Brian F Madigan
Cc: James A Clouse; William B English; William R Nelson; Seth B Carpenter
Subject: liquidity conditions yesterday from CPCs
Date: 09/16/2008 08:05 AM
This is a brief summary of what FRBNY's CPC teams learned about liquidity
conditions yesterday from their respective institutions.
Not Responsive
Money Funds Not Responsive

noted that one fund--Reserve
(b)(4) & (b)(8)
Funds--had a large amount of Lehman and AIG exposure and will probably ‘break
the buck’ (trade below $1) and need to be acquired by an outside party.
BOG-- FOIA 10-251 --000882

To: Deborah P Bailey; Coryann Stefansson
Subject: Fw: liquidity conditions yesterday from CPCs
Date: 09/16/2008 08:08 AM
Just FYI...Interesting note on the money fund situation....easier to understand why

those funds were experiencing major redemption requests! Jim
jclouse@frb.gov
cell: (b) (6)
Roberto
Perli/BOARD/FRS
cc James A Clouse/BOARD/FRS@BOARD, William B
09/16/2008 08:05 AM Nelson/BOARD/FRS@BOARD, Seth B
Carpenter/BOARD/FRS@BOARD
Subject liquidity conditions yesterday from CPCs
Duplicate
BOG-- FOIA 10-251 --000883

To: James A Clouse; Deborah P Bailey
Subject: Re: liquidity conditions yesterday from CPCs
Date: 09/16/2008 08:29 AM
Hey
Thanks for the forward. I just want to put a caveat out that (b) (5)
Cory
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
▼ James A Clouse

Sent: 09/16/2008 08:08 AM EDT
To: Deborah Bailey; Coryann Stefansson
Subje
Duplicate
----- Forwar
BOG-- FOIA 10-251 --000884

From: Meg McConnell
To: Patrick M Parkinson; Beverly Hirtle
Subject: Re: Fw: legislative agenda
Date: 09/16/2008 08:34 AM
(b) (5)
Margaret M. McConnell
212-720-8773
▼ Patrick M Parkinson

Sent: 09/16/2008 08:24 AM EDT
To: Beverly Hirtle
Cc: Meg McConnell
Subject: Re: Fw: legislative agenda
Various people (not me) were working on this through the night. I've not seen
what they produced. Meg is likely to know more.
Pat
▼ Beverly Hirtle/NY/FRS@FRS
Beverly
Hirtle/NY/FRS@FRS
cc Meg McConnell/NY/FRS
09/16/2008 08:22 AM Subject Fw: legislative agenda
Pat,
I volunteered to help organize FRBNY participation on these efforts. Is there

someone I could talk to (you?) for a few minutes to get some more information
about what's going on? Thanks.
Bev
Beverly Hirtle
Senior Vice President
(212) 720-7544
----- Forwarded by Beverly Hirtle/NY/FRS on 09/16/2008 08:21 AM -----
Meg McConnell/NY/FRS
To Beverly Hirtle/NY/FRS@FRS
cc
09/15/2008 02:07 PM
Subject Fw: legislative agenda
Hi Bev,
I haven't had a chance to look through this yet, but here is what Pat forwarded
BOG-- FOIA 10-251 --000885

me on this. I guess this question is how/who at FRBNY could work on some or
all of these with Board staff in the near-term. Some of it we may have already
thought through in some form or another.
Meg
----- Forwarded by Meg McConnell/NY/FRS on 09/15/2008 01:59 PM -----
Patrick.M.Parkinson@frb.gov
To "Meg McConnell" <Meg.McConnell@ny.frb.org>
cc
09/15/2008 09:07 AM
Subject Fw: legislative agenda
Please strictly limit distribution. Thanks. Pat

From: Donald L Kohn
Sent: 09/15/2008 08:51 AM EDT
Subject: Fw: legislative agenda
----- Forwarded by Donald L Kohn/BOARD/FRS on 09/15/2008 08:51 AM -----

Donald
L

Kohn/BOARD/FRS

To
01:34 (b) (6)
(b) (6)
PM
cc
brian.f.madigan@frb.gov,
Kevin
Warsh/BOARD/FRS@Board,
Scott
Alvarez/BOARD/FRS@Board,
Timothy
Geithner/NY/FRS@FRS, Donald
L

Kohn/BOARD/FRS

Subject
Re: legislative
agenda(Document
link: Donald L
Kohn)

cleaned up 1c. along the lines Ben suggested.

(See attached file: Possible Legislative Proposals.doc)

BOG-- FOIA 10-251 --000886

(b) (6)

To
09/14/2008 01:23 Donald L
PM
cc
brian.f.madigan@frb.gov, Donald
L
Kohn/BOARD/FRS@BOARD,
Kevin
Warsh/BOARD/FRS@BOARD,
Scott
Alvarez/BOARD/FRS@BOARD,
Timothy

Geithner/NY/FRS@FRS

Subject
Re: legislative
agenda(Document
link: Donald L
Kohn)

Thanks.
(b) (5)

Donald
L

Kohn/BOARD/FRS

To (b) (6)
:14
(b) (6)
PM Kevin
Warsh/BOARD/FRS@BOARD,
Timothy
Geithner/NY/FRS@FRS

cc
brian.f.madigan@frb.gov,
Scott
Alvarez/BOARD/FRS@BOARD, Donald
L

Kohn/BOARD/FRS

Subject
legislative
agenda

BOG-- FOIA 10-251 --000887

here's my list of possible legislation. (b) (5)

(b) (5)
[attachment "Possible Legislative Proposals.doc" deleted by Donald L

Kohn/BOARD/FRS]
[attachment "Possible Legislative Proposals.doc" deleted by Meg McConnell/NY/FRS]
BOG-- FOIA 10-251 --000888

Date: 09/16/2008 08:44 AM
Gustavo, not sure if you checked all of these:
Moody's has downgraded the following ratings and assigned a negative

outlook:
AIG Capital Corporation -- short-term issuer rating to Prime 2 from Prime

1;
American General Finance Corporation -- short-term debt to Prime 2

from Prime-1;
American General Finance, Inc. -- short-term debt to Prime-2 from

Prime-1;
CommoLoco, Inc. -- backed short-term debt to Prime-2 from Prime-1;
International Lease Finance Corporation -- short-term debt to Prime-2

from Prime-1.
Moody's has placed the following ratings on review for possible

downgrade:
American International Group, Inc. -- short-term issuer rating at Prime-

1;
AIG Financial Products Corp. -- backed short-term debt at Prime-1;
AIG Funding, Inc. -- backed short-term debt at Prime-1;
AIG General Insurance (Taiwan) Co., Ltd. -- insurance financial strength

at A1;
AIG Liquidity Corp. -- backed short-term debt at Prime-1;
BOG-- FOIA 10-251 --000889

AIG Matched Funding Corp. -- backed short-term debt at Prime-1;
Mike
Gustavo A
Suarez/BOARD/FRS
Subject AIG subs CP
Duplicate
BOG-- FOIA 10-251 --000890

From: Scott Alvarez
To: Robert Hoyt
Subject: Re: Use of existing Authority
Date: 09/16/2008 08:55 AM
Importance: High
Bob
(b) (5)
Thanks!
Scott
--------------------------
From: Robert.Hoyt
Sent: 09/16/2008 12:47 AM AST
To: Dan.Jester@do.treas.gov; Jeremiah.Norton@do.treas.gov; Neel.Kashkari@do.treas.gov;
David.McCormick@do.treas.gov; Tony.Ryan@do.treas.gov; Scott Alvarez; Timothy Geithner
Subject: Fw: Use of existing Authority
From: Bob Hoyt

To: Hoyt, Robert
Sent: Tue Sep 16 00:43:26 2008
Subject: Use of existing Authority
Duplicate
BOG-- FOIA 10-251 --000891

From: JNellie Liang
To: Daniel M Covitz; Gustavo A Suarez
Subject: draft
Date: 09/16/2008 08:55 AM
Attachments: AIG.cp.091608.doc
BOG-- FOIA 10-251 --000892

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000893

From: Kevin Warsh
To: (b) (5)
Subject:
Date: 09/16/2008 08:56 AM
In fomc meeting by can u email me your views on the liquidity need and capital
need by aig. Want to make sure treas has clear understanding of difference
--------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000894

From: Robert.Hoyt@do.treas.gov
Date: 09/16/2008 08:56 AM
(b) (5)
From: Scott.Alvarez@frb.gov
To: Hoyt, Robert
Sent: Tue Sep 16 08:55:43 2008
Bob
Duplicate
BOG-- FOIA 10-251 --000895

Subject: Fw: Briefing email: BAC - Overview of Enterprise actions (7.30am meeting Senior Enterprise Executive Cmte)
Date: 09/16/2008 09:02 AM
Jon Greenlee
Associate Director
Phone (202) 452-2962
Brad
Evans/RICH/FRS@FRS
To NY Banksup LFI CPC
cc Jennifer Burns/RICH/FRS@FRS, Lisa A White, Nancy R
Berlad/BOARD/FRS@BOARD
09/16/2008 08:52 AM
Subject Fw: Briefing email: BAC - Overview of Enterprise
actions (7.30am meeting Senior Enterprise Executive
Cmte)
Briefing email: BAC - Overview of Enterprise actions (Meeting Senior Enterprise

Executive Cmte)
7.30am Key Contacts: Arrington Mixon, Ed O'Keefe

Not Responsive
(b)(4) & (b)(8)
Best Regards,
Brad Evans
Federal Reserve
BOG-- FOIA 10-251 --000896

From: JNellie Liang
To: Daniel M Covitz; Gustavo A Suarez
Subject: revised draft
Date: 09/16/2008 09:04 AM
Attachments: AIG.cp.091608.doc
BOG-- FOIA 10-251 --000897

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000898

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --000899

From: Kevin Warsh
Subject:
Date: 09/16/2008 09:13 AM
(b) (5)
--------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000900

To: Calvin Mitchell
Subject:
Date: 09/16/2008 09:19 AM
(b) (5)
BOG-- FOIA 10-251 --000901

From: Todd.Waszkelewicz@ny.frb.org
To: Marsha Takagi; Jeanmarie Davis; Che.Sidanius@ny.frb.org; Jeremy.Gagne@ny.frb.org;
William.Johnson@ny.frb.org; Jeffrey Marquardt; Theodore Lubke; Jeff Stehm; Roger Graham;
Lawrence.Sweet@ny.frb.org
Subject: Today's outlook for CLS
Date: 09/16/2008 09:23 AM
FR Restricted:
Not Responsive
(b)(4) & (b)(8)
I hope to get another update in an hour after the Citi talks.
Thanks.
-----------------
BOG-- FOIA 10-251 --000902

From: Kevin Warsh
To: dan.jester@do.treas.gov
Subject: In fomc mtg
Date: 09/16/2008 09:31 AM
Dan
(b) (5) Thx
Kevin
--------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000903

From: Dan.Jester@do.treas.gov
To: Kevin.Warsh@frb.gov
Subject: Re: In fomc mtg
Date: 09/16/2008 09:44 AM
(b) (5)

From: Kevin.Warsh@frb.gov <Kevin.Warsh@frb.gov>
To: Jester, Dan (Contractor)
Sent: Tue Sep 16 09:31:20 2008
Subject: In fomc mtg
Dan
Duplicate
BOG-- FOIA 10-251 --000904

From: Rich Ashton
To: Mark VanDerWeide; Sophia H Allison
Subject: Resolution attached
Date: 09/16/2008 09:50 AM
Attachments: AIG resolution II.doc
BOG-- FOIA 10-251 --000905

(b) (5)
BOG-- FOIA 10-251 --000906

From: (b) (4)
To: kevin.warsh@frb.gov
Subject: Re:
Date: 09/16/2008 09:54 AM
Market in distress. AIG is creating fear. Banks stopping taking names. CDS much wider.

From: Kevin Warsh@frb.gov <Kevin.Warsh@frb.gov>
To: (b) (4)
Sent: Tue Sep 16 09:35:05 2008
Mkt developments this am pls by emal

--------------------------------------------------------------------------------
BOG-- FOIA 10-251 --000907

From: Jack Jennings
Date: 09/16/2008 09:57 AM
are you on call, they are reviewing the aig info with foreign supervisors
Jack P. Jennings, II
Associate Director
International Supervision, Training and Assistance
Phone: (202) 452-3053
Fax: (202) 452-2770
Email: jack.jennings@frb.gov
Coryann
Stefansson/BOARD/FRS
To Jack Jennings/BOARD/FRS@BOARD
cc
09/15/2008 10:34 PM Subject Fw: AIG & Identifying other firms under stress
Duplicate
BOG-- FOIA 10-251 --000908

From: Kevin Warsh
To: Dan Jester
Date: 09/16/2008 09:58 AM
Is it your view tha (b) (5)

?
--------------------------------------------------------------------------------
From: Dan.Jester
Sent: 09/16/2008 09:44 AM AST
To: Kevin Warsh
Duplicate
BOG-- FOIA 10-251 --000909

From: Daniel M Covitz
To: JNellie Liang
Subject: cp memo
Date: 09/16/2008 09:58 AM
Attachments: AIG.cp.091608.dmc.gs.doc
Nellie,
Nice memo. We put in some edits and updated facts. Changes are tracked, so
please accept or reject them before sending.
Dan and Gustavo
BOG-- FOIA 10-251 --000910

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000911

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000912

From: Mike Collins
To: Jon D Greenlee; Deborah P Bailey; Roger Cole
Cc: Susan V Foley
Subject: Fw: Summary of actions for Lehman Brothers FSB and AIG FSB
Date: 09/16/2008 10:07 AM
FYI
Michael E. Collins
Senior Vice President and Lending Officer
Federal Reserve Bank of Philadelphia
215-574-4142
215-574-3943 (fax)
----- Forwarded by Mike Collins/PHIL/FRS on 09/16/2008 10:05 AM -----
Gail Todd/PHIL/FRS
To Mike Collins/PHIL/FRS@FRS, Vish
Viswanathan/PHIL/FRS@FRS
09/16/2008 09:29 AM cc
Subject Summary of actions for Lehman Brothers FSB and AIG
FSB
Restricted - FR
Lehman Brothers FSB

Not Responsive
BOG-- FOIA 10-251 --000913

Not Responsive
BOG-- FOIA 10-251 --000914

AIG FSB -
Brief Profile:
As of 6/30/08:
Total Assets $1.2 bil
Total Deposits $1.1 bil
(b) (8)
Discount Window documents - however, no collateral
DLOD Cap Deminimus

Capacity $57 mil
Avg Peak DLOD $ 3 thousand
Peak DLOD $28 thousand
Account Activity:
(b) (4)
A (b)(4), (b)(5), & (b)(8)
Not Responsive
Please let me know if you need any additional information.

Gail
BOG-- FOIA 10-251 --000915

From: Tim P Clark
Cc: Jon D Greenlee
Subject: Re: AIG -monolines/guarantors
Date: 09/16/2008 10:22 AM
AIG has sold a lot of protection that is similar to the type of protection the
guarantors sold -- 'super senior' protection against CDOs. They sold $80 billion of
'multi-sector' CDO protection, which includes the ABS CDO type stuff the guarantors
did and had taken MTM losses of $27 billion against that as of August. As of
August, they had posted $16 billion of collateral against these MTM losses, leaving
$10 billion open exposure at counterparties. They also have a large book of
corporate CDO related CDS protection sold and given what spreads aredoing this is
no doubt causing some MTM losses -- and growing exposures at banks -- as well.
Deborah P
Bailey/BOARD/FRS
To Tim P Clark/BOARD/FRS@BOARD
09/16/2008 10:09 AM Subject AIG -monolines/guarantors
Tim, was AIG big in this? I can't remember. If you have any insights
please provide to Jon. I have asked him to be the point on this.
thanks
BOG-- FOIA 10-251 --000916

From: Kieran Fallon
To: Scott Alvarez; neel.kashkari@do.treas.gov
Subject: Outline of Emergency Resolution and Funding Authority
Date: 09/16/2008 10:36 AM
Attachments: Nonbank Financial Firm Resolutions (Sept. 16, 2008 v2).doc
Kieran J. Fallon
Assistant General Counsel
20th Street & Constitution Ave., N.W.
Washington, D.C. 20551
Tel: 202-452-5270
Fax: 202-452-3101
BOG-- FOIA 10-251 --000917

(b) (5)
BOG-- FOIA 10-251 --000918

(b) (5)
BOG-- FOIA 10-251 --000919

(b) (5)
BOG-- FOIA 10-251 --000920

(b) (5)
BOG-- FOIA 10-251 --000921

(b) (5)
BOG-- FOIA 10-251 --000922

(b) (5)
BOG-- FOIA 10-251 --000923

(b) (5)
BOG-- FOIA 10-251 --000924

From: William Johnson
To: Christopher Hunter; Alexa Philo; Amy White; Andrew Small; Anthony Cirillo; Arthur Angulo; Barbara Yelcich;
Bard Stermasi; Bin Lang; Brandon Hall; Brian Begalle; Brian Hefferle; Brian Peters; Bridget Habib; Caroline
Nuffort; Catherine Voigts; Chris Haley; Christina Zausner; Christine E Schwaninger; Christopher Calabia; Claudia
Franco; Clinton Lively; Corbin Long; Coryann Stefansson; Craig Leiby; Daniel Muccia; Deborah Lohnau; Dexter
Williams; Dianne Dobbeck; H Clay Saylor; Homer Hill; Isabella Lo Piccolo; James Hodgetts; Jan Voigts; Jane
Wakefield; Jeanmarie Davis; Jeffrey Levine; Jennifer Burns; Jim Mahoney; John Beebe; John Harvey; John
Heinze; John Ricketti; Jon D Greenlee; Jonathan Polk; Jordan Pollinger; Joseph Galati; Joshua Sherwin; Judith
J Gruttman; Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kenton Beerman; Kevin Clarke; Kevin Coffey;
Kevin Lee; Kirsten Harlow; Kyle Grieser; Lance Auer; Lawrence ROSTOKER; Laxmi Rao; Lucinda M Brickler; Luis
Uranga; Mark Scapp; Michael Johnson; Nancy R Berlad; Patrick M Parkinson; Paul Whynott; Randolph Brown;
Richard Kunen; Richard McGee; Robert Gutierrez; Roger Graham; Ronald Stroz; Sandy Krieger; Sarah
Dahlgren; Stephanie Chaly; Steven J Manzari; Steven Mirsky; Susan G Ballinger; Susan Goldberg; Theodore
Lubke; Theonilla Lee-Chan; Thomas J O'Keeffe; Tim P Clark; Todd Waszkelewicz; Wendy Ng; William
BRODOWS; William Hallacy; Wing Oon
Cc: Todd Waszkelewicz; Che Sidanius; Jeremy Gagne; Emily Bradley
Subject: CLS 9/16 update - morning
Date: 09/16/2008 10:54 AM
CLS Update - Tuesday 9/16/08 morning

Not Responsive
(b)(4) & (b)(8)
Not Responsive
William Johnson
212-720-2393
BOG-- FOIA 10-251 --000925

From: Fang Du
To: BSR Credit Risk@BOARD
Cc: Jon D Greenlee
Subject: Banks linked to $75 billion lending facility after AIG rating downgrade
Date: 09/16/2008 11:04 AM
AIG had its key credit rating downgraded by all three major rating
agencies after receiving a $20 billion lifeline from New York insurance
regulators. The insurer is also working to secure a lending facility
arranged by JPMorgan Chase and Goldman Sachs of as much as $75
billion, a crucial step in light of the downgrade, which has the potential to
trigger substantial collateral payments on AIG's numerous credit-
derivative trades. Standard & Poor's warned that AIG's credit rating
could be reduced even more if it is not able to "implement further
liquidity options" and "the successful sale of at least a portion of its
business assets."
Best Regards,
Fang Du
BS&R, Federal Reserve Board
(202) 872 - 4971 or (401) 789 -1194
(b) (6)
fang.du@frb.gov
BOG-- FOIA 10-251 --000926

From: Betsy Gordon
Cc: paul.austin@ny.frb.org; Christopher Hunter
Subject: payments-settlement ..update
Date: 09/16/2008 11:15 AM
Not Responsive
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000927

Not Responsive
Regards,
Betsy H. Gordon
Federal Reserve Bank of New York: 1 (212) 720-2257
UBS 203 719-7389
Blackberry (b) (6)
BOG-- FOIA 10-251 --000928

From: Daniel M Covitz
To: JNellie Liang
Subject: cp memo
Date: 09/16/2008 11:21 AM
Attachments: AIG.cp.091608.dmc.gs.doc
Nellie,
(b) (5)
Dan and Gustavo
BOG-- FOIA 10-251 --000929

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000930

(b) (4) and (b) (5)
BOG-- FOIA 10-251 --000931

From: Renuka Vijayanathan
To: Alexa Philo; Amy White; Andrew Small; Anthony Cirillo; Arthur Angulo; Barbara Yelcich; Bard Stermasi; Bin
Lang; Brandon Hall; Brian Begalle; Brian Hefferle; Brian Peters; Bridget Habib; Caroline Nuffort; Catherine
Voigts; Chris Haley; Christina Zausner; Christine E Schwaninger; Christopher Calabia; Claudia Franco; Clinton
Lively; Corbin Long; Coryann Stefansson; Craig Leiby; Daniel Muccia; Deborah Lohnau; Dexter Williams;
Dianne Dobbeck; H Clay Saylor; Homer Hill; Isabella Lo Piccolo; James Hodgetts; Jan Voigts; Jane Wakefield;
Jeanmarie Davis; Jeffrey Levine; Jennifer Burns; Jim Mahoney; John Beebe; John Harvey; John Heinze; John
Ricketti; Jon D Greenlee; Jonathan Polk; Jordan Pollinger; Joseph Galati; Joshua Sherwin; Judith J Gruttman;
Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kenton Beerman; Kevin Clarke; Kevin Coffey; Kevin Lee;
Kirsten Harlow; Kyle Grieser; Lance Auer; Lawrence ROSTOKER; Laxmi Rao; Lucinda M Brickler; Luis Uranga;
Mark Scapp; Michael Johnson; Nancy R Berlad; Patrick M Parkinson; Paul Whynott; Randolph Brown; Richard
Kunen; Richard McGee; Robert Gutierrez; Roger Graham; Ronald Stroz; Sandy Krieger; Sarah Dahlgren;
Stephanie Chaly; Steven J Manzari; Steven Mirsky; Susan G Ballinger; Susan Goldberg; Theodore Lubke;
Theonilla Lee-Chan; Thomas J O'Keeffe; Tim P Clark; Todd Waszkelewicz; Wendy Ng; William BRODOWS;
William Hallacy; Wing Oon
Cc: Randolph Brown; Kenton Beerman; Glen Reppy; Bin Lang; Catherine A Tilford
Subject: SG- 9/16 liquidity update 10.30am
Date: 09/16/2008 11:25 AM
Attachments: Not Responsive
Not Responsive
BOG-- FOIA 10-251 --000932

Not Responsive
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000933

Not Responsive
BOG-- FOIA 10-251 --000934

Not Responsive
BOG-- FOIA 10-251 --000935

Not Responsive
BOG-- FOIA 10-251 --000936

Not Responsive
BOG-- FOIA 10-251 --000937

From: John Ammer
To: Mark Carey
Cc: Sally M Davies
Subject: Re: Fw: International ramifications of an AIG failure - poking a bit more at the 10-K
Date: 09/16/2008 11:27 AM
Mark:
I have the reporting-segment balance sheet information (Note 2) and information

about AIG investments (Note 3) on my desk if you want to have a look.
There are $145 billion inl eliminations, but it is not clear if they are mainly parent-
sub or sub-sub.
AIGFP had $115 billion in end-'07 assets and was involved to at least some extent in
offering CDS protection on CDO tranches.
About 28% of the group's half-trillion dollar bond porttfolio was in the MBS/ABS
category, with Fair Value stated as just a few percent below Cost.
-John
▼ Mark Carey/BOARD/FRS
Mark
Carey/BOARD/FRS
To Sally M Davies/BOARD/FRS@BOARD, John
Ammer/BOARD/FRS@BOARD
cc
09/15/2008 05:53 PM
Subject Fw: International ramifications of an AIG failure
I wrote the email below in response to a question raised at a meeting

earlier today.
Mark Carey
Adviser
Division of International Finance
Washington, DC 20551 USA
(202) 452-2784 voice
(202) 872-4926 fax
mark.carey@frb.gov email
----- Forwarded by Mark Carey/BOARD/FRS on 09/15/2008 05:52 PM -----
Mark
Carey/BOARD/FRS
To IF Officers and Section Chiefs
cc
09/15/2008 05:29 PM Subject International ramifications of an AIG failure
Duplicate
BOG-- FOIA 10-251 --000938
To: Deborah P Bailey; BSR LIG; Roger Cole; Norah Barger; William English; Brian Peters
Subject: Fw: Citi - AIG
Date: 09/16/2008 11:32 AM
(b) (5)
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
▼ Brian Peters

From: Brian Peters
Sent: 09/16/2008 11:19 AM EDT
To: Coryann Stefansson; Terrence Checki
(b) (4) (b) (5) and (b) (8)

▼ William Hallacy

From: William Hallacy
Sent: 09/16/2008 11:16 AM EDT
To: Brian Peters; Dianne Dobbeck; Catherine Voigts; Steven
Mirsky; Alejandro LaTorre; NY Banksup AIG Monitoring and
Analysis
Cc: Antonio Alvarez; Steven Mirsky; Dexter Williams; Bridget
Habib; Jordan Pollinger; Kyle Grieser; Brandon Hall; Laxmi Rao
Subject: Citi - AIG
Just got off phone w/Citi -
(b) (4) and (b) (8)

Fed 212-720-2776
Citi 212-583-7104
BOG-- FOIA 10-251 --000939

From: Rich Ashton
To: Scott.Alvarez@frb.gov; Mark VanDerWeide; Sophia H Allison
Subject: Draft memo on authority to make advance attached
Date: 09/16/2008 11:34 AM
Attachments: AIG authority to make advance memo.doc
BOG-- FOIA 10-251 --000940

(b) (5)
BOG-- FOIA 10-251 --000941

2
(b) (5)
BOG-- FOIA 10-251 --000942

3
(b) (5)
BOG-- FOIA 10-251 --000943

To: Jon D Greenlee; Brian F Madigan; Roger.Cole@frb.gov; William R Nelson; William B English; Donald L Kohn
Date: 09/16/2008 11:34 AM
(b)(4) & (b)(8)

----- Forwarded by Deborah P Bailey/BOARD/FRS on 09/16/2008 11:33 AM -----
Coryann
To Deborah P Bailey/BOARD/FRS@BOARD, BSR LIG,
"Roger Cole" <Roger.Cole@frb.gov>, "Norah Barger"
<Norah.Barger@frb.gov>, "William English"
09/16/2008 11:32 AM <William.B.English@frb.gov>, "Brian Peters"
<Brian.Peters@ny.frb.org>
cc
Subject Fw: Citi - AIG
Duplicate
BOG-- FOIA 10-251 --000944

From: William Johnson
To: Christopher Hunter; Brian Begalle; Alexa Philo; Amy White; Andrew Small; Anthony Cirillo; Arthur Angulo;
Barbara Yelcich; Bard Stermasi; Bin Lang; Brandon Hall; Brian Begalle; Brian Hefferle; Brian Peters; Bridget
Habib; Caroline Nuffort; Catherine Voigts; Chris Haley; Christina Zausner; Christine E Schwaninger; Christopher
Calabia; Claudia Franco; Clinton Lively; Corbin Long; Coryann Stefansson; Craig Leiby; Daniel Muccia; Deborah
Lohnau; Dexter Williams; Dianne Dobbeck; H Clay Saylor; Homer Hill; Isabella Lo Piccolo; James Hodgetts; Jan
Voigts; Jane Wakefield; Jeanmarie Davis; Jeffrey Levine; Jennifer Burns; Jim Mahoney; John Beebe; John
Harvey; John Heinze; John Ricketti; Jon D Greenlee; Jonathan Polk; Jordan Pollinger; Joseph Galati; Joshua
Sherwin; Judith J Gruttman; Kara Sulmasy; Karen Kahrs; Katheryn Van der Celen; Kenton Beerman; Kevin
Clarke; Kevin Coffey; Kevin Lee; Kirsten Harlow; Kyle Grieser; Lance Auer; Lawrence ROSTOKER; Laxmi Rao;
Lucinda M Brickler; Luis Uranga; Mark Scapp; Michael Johnson; Nancy R Berlad; Patrick M Parkinson; Paul
Whynott; Randolph Brown; Richard Kunen; Richard McGee; Robert Gutierrez; Roger Graham; Ronald Stroz;
Sandy Krieger; Sarah Dahlgren; Stephanie Chaly; Steven J Manzari; Steven Mirsky; Susan G Ballinger; Susan
Goldberg; Theodore Lubke; Theonilla Lee-Chan; Thomas J O'Keeffe; Tim P Clark; Todd Waszkelewicz; Wendy
Ng; William BRODOWS; William Hallacy; Wing Oon; Jeanmarie Davis
Cc: Todd Waszkelewicz; Che Sidanius; Jeremy Gagne; Emily Bradley
Subject: CLS update 9/16 11am
Date: 09/16/2008 11:37 AM
Not Responsive
(b)(4), (b)(5), & (b)(8)
William Johnson
212-720-2393
BOG-- FOIA 10-251 --000945

To: Deborah P Bailey; Jennifer Burns
Subject: Fw: Briefing email: BAC - Overview of Enterprise actions (7.30am meeting Senior Enterprise Executive Cmte)
Date: 09/16/2008 11:39 AM
Now we know why there is concern

Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
▼ Nancy R Berlad

From: Nancy R Berlad
Sent: 09/16/2008 10:57 AM EDT
To: BSR LIG
Subject: Fw: Briefing email: BAC - Overview of Enterprise actions
(7.30am meeting Senior Enterprise Executive Cmte)
Cory,
Key Points from E-mail below:

Not Responsive
(b)(4), (b)(5), & (b)(8)
----- Forwarded by Nancy R Berlad/BOARD/FRS on 09/16/2008 10:51 AM -----
Brad
Evans/RICH/FRS@FRS
To NY Banksup LFI CPC
cc Jennifer Burns/RICH/FRS@FRS, Lisa A White, Nancy R
Berlad/BOARD/FRS@BOARD
09/16/2008 08:52 AM
Subject Fw: Briefing email: BAC - Overview of Enterprise
actions (7.30am meeting Senior Enterprise Executive
Cmte)
Duplicate
BOG-- FOIA 10-251 --000946

From: Timothy Carlin
Cc: Stephanie Chaly; Linda Rodriguez; Yogesh Shah; Nirali Deringer; Carol Roller; Pat Soriano; Christopher Hunter;
Richard Kunen
Subject: Barclays Ops Update
Date: 09/16/2008 11:41 AM
RESTRICTED FR
Barclays Ops Update

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000947

From: Bart Simon
Cc: Cynthia L Martin
Subject: CS AIG commentary
Date: 09/16/2008 11:41 AM
Attachments: CSFB - AIG Commentary - 9-16-2008.pdf
_________________________
Bart Simon
600 Atlantic Avenue
(617) 973-3231
Mailing address:
Post Office Box 55882
BOG-- FOIA 10-251 --000948

(b) (4)
BOG-- FOIA 10-251 --000949

(b) (4)
BOG-- FOIA 10-251 --000950

(b) (4)
BOG-- FOIA 10-251 --000951

(b) (4)
BOG-- FOIA 10-251 --000952

(b) (4)
BOG-- FOIA 10-251 --000953

(b) (4)
BOG-- FOIA 10-251 --000954

To: Calvin Mitchell; Thomas Baxter; Scott Alvarez
Subject: Re: draft statement
Date: 09/16/2008 11:42 AM
(b) (5)
Sent: 09/16/2008 11:41 AM AST
To: Michelle Smith; Thomas Baxter; Scott Alvarez
Subject: draft statement
(b) (5)
BOG-- FOIA 10-251 --000955

From: Sophia H Allison
To: Rich Ashton
Cc: Mark VanDerWeide; Scott Alvarez; Kieran Fallon; sophia.h.allison@frb.gov; stephanie.martin@frb.gov
Subject: Re: Draft memo on authority to make advance attached
Date: 09/16/2008 11:46 AM
Attachments: AIG authority to make advance memo sha 09162008.doc
Rich,
Some minor edits - I have somewhere the authorities for the last edit on the last
page where it says [CITES].
Sophia
Attachment: U:\Allison\A\2008\AIG\AIG authority to make advance

memo_sha_09162008.doc
▼ Rich Ashton/BOARD/FRS
Rich
Ashton/BOARD/FRS
To Scott.Alvarez@frb.gov, Mark
VanDerWeide/BOARD/FRS@BOARD, Sophia H
Allison/BOARD/FRS@BOARD
09/16/2008 11:34 AM cc
Subject Draft memo on authority to make advance attached
BOG-- FOIA 10-251 --000956

(b) (5)
BOG-- FOIA 10-251 --000957

(b) (5)
BOG-- FOIA 10-251 --000958

(b) (5)
BOG-- FOIA 10-251 --000959

From: Tim P Clark
Cc: Brian Peters; BSR LIG; Deborah P Bailey; Norah Barger; Roger Cole; William English
Subject: Re: Fw: Citi - AIG
Date: 09/16/2008 11:47 AM
(b)(4), (b)(5), & (b)(8)
Coryann
To Deborah P Bailey/BOARD/FRS@BOARD, BSR LIG,
"Roger Cole" <Roger.Cole@frb.gov>, "Norah Barger"
<Norah.Barger@frb.gov>, "William English"
09/16/2008 11:32 AM <William.B.English@frb.gov>, "Brian Peters"
<Brian.Peters@ny.frb.org>
cc
Subject Fw: Citi - AIG
Duplicate
BOG-- FOIA 10-251 --000960

From: Moses Cheng
Subject: DB September 16, 2008 Market Risk Management Morning Update
Date: 09/16/2008 11:49 AM
**Restricted FR**
Prepared by Moses Cheng and Tai Wondwosen

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000961

*************************************
212-720-1433
212-250-6075
BOG-- FOIA 10-251 --000962

From: Rich Ashton
Cc: Mark VanDerWeide; Sophia H Allison
Subject: Latest resolution
Date: 09/16/2008 11:51 AM
BOG-- FOIA 10-251 --000963

(b) (5)
BOG-- FOIA 10-251 --000964

From: Scott Alvarez
To: Timothy Geithner; Thomas Baxter
Subject: Fw: Latest resolution
Date: 09/16/2008 11:56 AM
Here is to present to the Board after

FOMC. (b) (5)
Tim, are you available to update the Board before they vote? We can warn
you when the end of FOMC draws near.
Thanks and comments welcome.
Scott
--------------------------

From: Rich.Ashton
Sent: 09/16/2008 11:51 AM AST
To: Scott Alvarez
Cc: Mark VanDerWeide; Sophia Allison
Subject: Latest resolution
(See attached file: AIG resolution II.doc) - AIG resolution II.doc
BOG-- FOIA 10-251 --000965

(b) (5)
BOG-- FOIA 10-251 --000966

From: Scott Alvarez
To: Thomas Baxter
Subject: AIG
Date: 09/16/2008 11:59 AM
Importance: High
Tom
(b) (5)
Scott
--------------------------
BOG-- FOIA 10-251 --000967

Cc: Scott Alvarez; Thomas Baxter
Subject: Re: draft statement
Date: 09/16/2008 12:01 PM
Sorry for the confusion; it's a fast moving target. (b) (5)
▼ Michelle A Smith/BOARD/FRS@BOARD
Michelle A
Smith/BOARD/FRS@BOARD
To Calvin Mitchell/NY/FRS@FRS, Thomas
Baxter/NY/FRS@FRS, Scott
09/16/2008 11:45 AM cc
Subject
Re: draft statement
Duplicate
BOG-- FOIA 10-251 --000968

From: JNellie Liang
To: Donald L Kohn; Kevin Warsh; Randall S Kroszner; Elizabeth A Duke; Rita C Proctor
Cc: Brian F Madigan; Patrick M Parkinson; JNellie Liang
Subject: Update on conditions in the commercial paper market
Date: 09/16/2008 12:03 PM
Attachments: AIG.CP.091608.pdf
Attached is a brief memo on conditions in the commercial paper market yesterday.
BOG-- FOIA 10-251 --000969

(b) (5)
BOG-- FOIA 10-251 --000970

(b) (5)
BOG-- FOIA 10-251 --000971

From: JNellie Liang
To: Stephen D Oliner; Michael G Palumbo; Karen Dynan; William B English; James A Clouse
Cc: Daniel M Covitz; Gustavo A Suarez
Subject: update on commercial paper market
Date: 09/16/2008 12:06 PM
Brief memo sent to Board on conditions in the commercial paper market yesterday.
BOG-- FOIA 10-251 --000972

(b) (5)
BOG-- FOIA 10-251 --000973

(b) (5)
BOG-- FOIA 10-251 --000974

From: Brian Peters
To: Coryann Stefansson; Deborah P Bailey; BSR LIG; Roger Cole; Norah Barger; William B English
Subject: Re: Citi - AIG
Date: 09/16/2008 12:11 PM
Working to confirm at citi and elsewhere

From: Coryann.Stefansson
Sent: 09/16/2008 11:32 AM AST
To: Deborah Bailey; BSR.LIG@frbog.frb.gov; Roger Cole; Norah Barger; William
English; Brian Peters
Duplicate
BOG-- FOIA 10-251 --000975

From: Jeff Stehm
To: Lisa Joniaux; William Carlucci; Lawrence Sweet; Marsha Takagi
Cc: Theodore Lubke; Jeffrey Marquardt; Coryann Stefansson; Genevievette E Walker
Subject: Known AIG US Infrastructure participation
Date: 09/16/2008 12:18 PM
Importance: High
Attachments: Known AIG affiliates - Infrastructure Participation.xls
All,
Here is what we could find on AIG affiliates participation in DTCC, OCC, CME, et al
so far. This information has been confirmed by a check of the membership lists of
these infrastructures, but we are not sure if other AIG affiliates going by a name
that is not know to us are also participants. If anyone has additional information to
provide please let us know and we'll update this chart.
Jeff Stehm
Associate Director
202-452-2217 (office)
(b) (6)
email: jeff.stehm@frb.gov
BOG-- FOIA 10-251 --000976

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --000977

From: Scott Alvarez
To: Neel Kashkari
Subject: Re: fund insert
Date: 09/16/2008 12:20 PM
Neel
How are we doing? Any news on AIG?
Scott
--------------------------
From: Neel.Kashkari
Sent: 09/16/2008 10:17 AM AST
To: Scott Alvarez
Not yet. Will be back soon.
From: Scott.Alvarez@frb.gov
To: Kashkari, Neel
Sent: Tue Sep 16 10:11:13 2008
Any progress? We'll break in about 30 minutes. Anything I should pass on to the Chair at
that point?
I'll have a revised outline on legislation before then. We are already at work on a draft of
the bill language.
Thanks!!
Scott
--------------------------
From: Neel.Kashkari
Sent: 09/16/2008 08:53 AM AST
To: Scott Alvarez
BOG-- FOIA 10-251 --000978

You got it

From: Scott.Alvarez@frb.gov <Scott.Alvarez@frb.gov>
To: Kashkari, Neel
Sent: Tue Sep 16 08:53:08 2008
Neel
(b) (5)
Thanks
Scott
--------------------------

From: Neel.Kashkari
Sent: 09/16/2008 12:40 AM AST
To: Scott Alvarez
Cc: Terrence Checki
Sounds good

To: Kashkari, Neel
Cc: Terrence.Checki@ny.frb.org <Terrence.Checki@ny.frb.org>
Sent: Tue Sep 16 00:39:19 2008
Neel,
(b) (5)
Scott
BOG-- FOIA 10-251 --000979

Neel.Kashkari@do.
treas.gov
To
09/16/2008 12:34 scott.alvarez@frb.gov,
AM Terrence.Checki@ny.frb.org
cc
Subject
Re: fund insert
(b) (5)

To: Kashkari, Neel; Terrence.Checki@ny.frb.org <Terrence.Checki@ny.frb.org>
Sent: Tue Sep 16 00:29:09 2008
Subject: fund insert
Here's a draft insert for the fund. Need more detail?
Thanks!
Scott
BOG-- FOIA 10-251 --000980

From: Neel.Kashkari@do.treas.gov
Subject: RE: fund insert
Date: 09/16/2008 12:23 PM
(b) (5)
From: Scott.Alvarez@frb.gov [mailto:Scott.Alvarez@frb.gov]
Sent: Tuesday, September 16, 2008 12:20 PM
To: Kashkari, Neel
Neel
How are we doing? Any news on AIG?
Scott
--------------------------
Duplicate
BOG-- FOIA 10-251 --000981

To: William Carlucci
Subject: AIG clearing broker/dealer, settling bank, outstanding CP
Date: 09/16/2008 12:25 PM
Hi Bill,
In case you're tired of Lehman...let's talk AIG.
I am re-attaching the spreadsheet with the participant family group groups and the
systems they use just so it is clear what I am asking about. There is no new info on
it since I sent it to you the other day.
(b)(4), (b)(5), & (b)(8)
Also, can you pull infomation on the outstanding CP in AIG's various programs?
Thanks.

202-530-6285
BOG-- FOIA 10-251 --000982

BOG-- FOIA 10-251 --000983
From: Scott Alvarez
To: Neel Kashkari
Date: 09/16/2008 12:26 PM
Great. (b) (5)

Thanks
Scott
--------------------------
From: Neel.Kashkari
Sent: 09/16/2008 12:23 PM AST
To: Scott Alvarez
Subject: RE: fund insert
Duplicate
BOG-- FOIA 10-251 --000984

From: Jeffrey Levine
Cc: Theonilla Lee-Chan; Barbara Yelcich; Gregory Gaare; Laura Braverman; Jennifer Tranter; Erin Upton; Edgar
Moreano; Christopher Hunter; Antonino Piscitello; James DeFalco; Liska Holness; Benjamin Eddy
Subject: JPMC: Liquidity Update from 10:30am conversation with Treasury
Date: 09/16/2008 12:29 PM
**Strictly Confidential - F.R. Material**
All,
Below are some highlights from this morning's call with JPMC's Treasury.
Jeff
Not Responsive
BOG-- FOIA 10-251 --000985

Not Responsive
BOG-- FOIA 10-251 --000986

Not Responsive
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --000987

From: Oesterle, Mark (Banking)
To: Laricke.D.Blanchard@frb.gov
Subject: Re:
Date: 09/16/2008 12:31 PM
Yep and aig in particular.

--------------------------
From: Laricke.D.Blanchard@frb.gov
To: Oesterle, Mark (Banking)
Sent: Tue Sep 16 12:28:25 2008
Subject: Re:
Ok. Status update re recent market developments?

--------------------------
From: "Oesterle, Mark (Banking)" [Mark_Oesterle@banking.senate.gov]

Sent: 09/16/2008 12:22 PM AST
To: Laricke Blanchard
Subject: Re:
Sorry was with him and could go to bb. He was looking for a status update
--------------------------

From: Laricke.D.Blanchard@frb.gov <Laricke.D.Blanchard@frb.gov>
To: Oesterle, Mark (Banking)
Sent: Tue Sep 16 11:54:02 2008
I hear that Shelby is trying to reach the Chairman. We are in FOMC. Do you
know what the topic is?
--------------------------
BOG-- FOIA 10-251 --000988

From: Neel.Kashkari@do.treas.gov
To: scott.alvarez@frb.gov
Date: 09/16/2008 12:41 PM
Yes. (b) (5)
Duplicate
BOG-- FOIA 10-251 --000989

From: Diya K Chauhan
To: Adrienne Haden; Barbara Cornyn; Craig F Marchbanks; David K Lynch; Diane Fraser; Donald N Gabbai; James
Embersit; John T Colwell; Jon D Greenlee; Karen L El Kochta; Mary L Arnett; Nina Nichols; Robert F Cote;
Sabeth I Siddique; Brian P Valenti; Lawrence A Rufrano
Subject: Analyst Reports-Lehman, AIG, BOA
Date: 09/16/2008 12:49 PM
Attachments: WF Lehman exposure.pdf
AIG analysis-15Sep.pdf
AIG Comment by Morgan Stanely Research.pdf
AIG Industry Comment 16Sep.pdf
BOA Analysis-16Sep.pdf
BOA Analysis.pdf
Lehman CDOs-Fitch.pdf
Diya K. Chauhan
(202) 452-3046
BOG-- FOIA 10-251 --000990

Not Responsive
BOG-- FOIA 10-251 --000991

Not Responsive
BOG-- FOIA 10-251 --000992

Not Responsive
BOG-- FOIA 10-251 --000993

Not Responsive
BOG-- FOIA 10-251 --000994

(b) (4)
BOG-- FOIA 10-251 --000995

(b) (4)
BOG-- FOIA 10-251 --000996

(b) (4)
BOG-- FOIA 10-251 --000997

(b) (4)
BOG-- FOIA 10-251 --000998

(b) (4)
BOG-- FOIA 10-251 --000999

(b) (4)
BOG-- FOIA 10-251 --001000

(b) (4)
BOG-- FOIA 10-251 --001001

(b) (4)
BOG-- FOIA 10-251 --001002

(b) (4)
BOG-- FOIA 10-251 --001003

(b) (4)
BOG-- FOIA 10-251 --001004

(b) (4)
BOG-- FOIA 10-251 --001005

(b) (4)
BOG-- FOIA 10-251 --001006

(b) (4)
BOG-- FOIA 10-251 --001007

(b) (4)
BOG-- FOIA 10-251 --001008

(b) (4)
BOG-- FOIA 10-251 --001009

(b) (4)
BOG-- FOIA 10-251 --001010

(b) (4)
BOG-- FOIA 10-251 --001011

(b) (4)
BOG-- FOIA 10-251 --001012

(b) (4)
BOG-- FOIA 10-251 --001013

(b) (4)
BOG-- FOIA 10-251 --001014

(b) (4)
BOG-- FOIA 10-251 --001015

(b) (4)
BOG-- FOIA 10-251 --001016

(b) (4)
BOG-- FOIA 10-251 --001017

(b) (4)
BOG-- FOIA 10-251 --001018

Not Responsive
BOG-- FOIA 10-251 --001019

Not Responsive
BOG-- FOIA 10-251 --001020

Not Responsive
BOG-- FOIA 10-251 --001021

Not Responsive
BOG-- FOIA 10-251 --001022

Not Responsive
BOG-- FOIA 10-251 --001023

Not Responsive
BOG-- FOIA 10-251 --001024

Not Responsive
BOG-- FOIA 10-251 --001025

Not Responsive
BOG-- FOIA 10-251 --001026

Not Responsive
BOG-- FOIA 10-251 --001027

Not Responsive
BOG-- FOIA 10-251 --001028

Not Responsive
BOG-- FOIA 10-251 --001029

Not Responsive
BOG-- FOIA 10-251 --001030

Not Responsive
BOG-- FOIA 10-251 --001031

Not Responsive
BOG-- FOIA 10-251 --001032

Not Responsive
BOG-- FOIA 10-251 --001033

Not Responsive
BOG-- FOIA 10-251 --001034

Not Responsive
BOG-- FOIA 10-251 --001035

Not Responsive
BOG-- FOIA 10-251 --001036

Not Responsive
BOG-- FOIA 10-251 --001037

Not Responsive
BOG-- FOIA 10-251 --001038

Not Responsive
BOG-- FOIA 10-251 --001039

Not Responsive
BOG-- FOIA 10-251 --001040

Not Responsive
BOG-- FOIA 10-251 --001041

Not Responsive
BOG-- FOIA 10-251 --001042

Not Responsive
BOG-- FOIA 10-251 --001043

Subject: Ratings Downgrades Reports
Date: 09/16/2008 12:51 PM
Attachments: Lehman downgrade by S&P.pdf
Merrill Entities on Watch-Fitch.pdf
WAMU Downgrade by S&P.pdf
AIG downgrade by Moody's.pdf
BOA downgrade by Moody's.pdf
BOA Downgrade by S&P.pdf
Lehman downgrade by Fitch.pdf
Lehman downgrade by Moody's.pdf
Diya K. Chauhan
(202) 452-3046
BOG-- FOIA 10-251 --001044

Fitch Press Release Page 1 of 2
Not Responsive
BOG-- FOIA 10-251 --001045
http://www.fitchresearch.com/creditdesk/press_releases/detail.cfm?print=1&pr_id=434960 9/16/2008
Not Responsive
BOG-- FOIA 10-251 --001046
Moodys - Corporate Highlights Page 1 of 6
(b) (4)
BOG-- FOIA 10-251 --001047
http://www.moodys.com/cust/loadHighLight.asp?documentID=1506800000006814&origi... 9/16/2008
(b) (4)
BOG-- FOIA 10-251 --001048
(b) (4)
BOG-- FOIA 10-251 --001049
(b) (4)
BOG-- FOIA 10-251 --001050
(b) (4)
BOG-- FOIA 10-251 --001051
(b) (4)
Back to To
©Copyright 2008 Moody's Investors Service Terms of Use Privacy Policy Proprietary Rights
16 SEP 2008, 12:20 Eastern Time
BOG-- FOIA 10-251 --001052
Not Responsive
BOG-- FOIA 10-251 --001053

Not Responsive
BOG-- FOIA 10-251 --001054
Not Responsive
Back to Top
BOG-- FOIA 10-251 --001055
Not Responsive
BOG-- FOIA 10-251 --001056
Not Responsive
BOG-- FOIA 10-251 --001057
Not Responsive
BOG-- FOIA 10-251 --001058
Not Responsive
BOG-- FOIA 10-251 --001059
Not Responsive
Back to Top
BOG-- FOIA 10-251 --001060
To: Krista Box
Subject: Re: Two reports on AIG from S&P "Ratings Direct"
Date: 09/16/2008 12:52 PM
Attachments: S&P AIG Ratings.pdf
S&P re- AIG Downgrade.pdf
thanks!
Office: 202-452-3579
Mobile: (b) (6)
▼ Krista Box/BOARD/FRS
Krista
Box/BOARD/FRS
cc
09/16/2008 12:20 PM Subject Two reports on AIG from S&P "Ratings Direct"
Bill,
I finally managed to find someone who has access to Standard and

Poor's "Ratings Direct" database. Here are two reports on AIG. One is
dated September 15, and the other September 16.
Please let me know if these aren't what you were expecting and if
you'd like me to continue searching.
- Krista Box, Research Library, x3332
BOG-- FOIA 10-251 --001061

To: Elise.Liebers@ny.frb.org; Diane.Fraser@frb.gov
Cc: Cynthia.L.Martin@bos.frb.org; Bart.Simon@bos.frb.org; Cynthia.L.Bordelon@chi.frb.org
Subject: Wall St. jumps on report government mulls AIG cash
Date: 09/16/2008 12:54 PM
Business Insurance
Wall St. jumps on report government mulls AIG cash
Sept. 16, 2008
NEW YORK (Reuters)—U.S. stocks rose on Tuesday after CNBC television

reported that government money had now been put on the table in
discussions over a financial lifeline for embattled insurer American
International Group Inc.
The Dow Jones industrial average rose 27.93 points, or 0.26%, to 10,945.44.
The Standard & Poor's 500 Index gained 2.58 points, or 0.22%, to 1,195.28.
The NASDAQ Composite Index rose 5.21 points, or 0.24%, to 2,185.12.
Stocks had slid earlier as investors feared that without a financial lifeline,
AIG's survival might come into question as the credit squeeze weighs on the
company.
Shares of AIG, a Dow component, pared losses to trade off 18% at $3.90.
Earlier the stock had plunged by more than 40% amid uncertainty about a
potential rescue deal.
Worries about AIG were accentuated by concerns that the U.S. government
would refuse to provide a financial lifeline as it did in the case of Lehman
Brothers Holdings. The 158-year-old Wall Street icon subsequently filed for
bankruptcy protection on Monday.
BOG-- FOIA 10-251 --001062

From: Ann Miner
To: Jennifer A Lucier
Subject: Fw: Counterparty Update 9/16/08 - Midday
Date: 09/16/2008 01:01 PM
----- Forwarded by Ann Miner/NY/FRS on 09/16/2008 01:00 PM -----
William
Hallacy/NY/FRS
To NY BankSup New York CPC
cc
09/16/2008 12:42 PM Subject Fw: Counterparty Update 9/16/08 - Midday
Restricted FR
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --001063

Not Responsive

Fed 212-720-2776
Citi 212-583-7104
BOG-- FOIA 10-251 --001064

To: Krista Box
Subject: Re: Two reports on AIG from S&P "Ratings Direct"
Date: 09/16/2008 01:02 PM
thanks Krista. Both of those are discussions of downgrades that ocurred because of
the AIG downgrade. What would be most helpful would be a discussion of why the
parent company, AIG, was downgraded.
It's not crucial if it is turning out to be a lot of work. The information is pretty much
covered by the wire services.
--Bill
Office: 202-452-3579
Mobile: (b) (6)
▼ Krista Box/BOARD/FRS
Krista
Box/BOARD/FRS
cc
09/16/2008 12:20 PM Subject Two reports on AIG from S&P "Ratings Direct"
Duplicate
BOG-- FOIA 10-251 --001065

Subject: AIG downgrade by S&P
Date: 09/16/2008 01:02 PM
Attachments: AIG downgrade by S&P.pdf
one more- sorry
Diya K. Chauhan
(202) 452-3046
BOG-- FOIA 10-251 --001066

From: Edgar Moreano
Cc: James DeFalco; Erin Upton; Gregory Gaare; Christopher Hunter; Jennifer Tranter; Antonino Piscitello; Jeffrey
Levine; Laura Braverman; Theonilla Lee-Chan; Benjamin Eddy; Barbara Yelcich; Steven J Manzari; Gregory
Gaare
Subject: AIG drawing on its credit line
Date: 09/16/2008 01:05 PM
JPMC credit risk management confirmed that (b)(4) & (b)(8)
Edgar Moreano
(212) 789-4359

BOG-- FOIA 10-251 --001067

From: Carol Roller
Cc: Stephanie Chaly; Yogesh Shah; Timothy Carlin; Linda Rodriguez; Nirali Deringer; Bridget Habib; Richard Kunen;
Pat Soriano
Subject: Barclays credit update - morning 9/16
Date: 09/16/2008 01:12 PM
Attachments: Credit Report 15Sep.snp
F.R. Restricted
(b)(4) & (b)(8)
Not Responsive
Collateral Management Credit Report - COB 9/15/08
The next Credit Risk Management meeting with Barclays is scheduled for 4:00 today.
Carol M. Roller
Fed: (212) 720-1902
Barclays: (212) 412-4063
BOG-- FOIA 10-251 --001068

From: Jeff Stehm
To: Melissa A Vanlandingham; Dibora Amanuel; Jeffrey Marquardt; Susan V Foley
Subject: Fw: AIG settling banks
Date: 09/16/2008 01:13 PM
Attachments: AIG settling banks info.pdf
Jeff Stehm
Associate Director
202-452-2217 (office)
(b) (6)
----- Forwarded by Jeff Stehm/BOARD/FRS on 09/16/2008 01:13 PM -----
Lisa
Joniaux/NY/FRS@FRS
To Jeff Stehm/BOARD/FRS@BOARD
cc
09/16/2008 01:10 PM Subject Fw: AIG settling banks
Lisa Joniaux
CPC for The Depository Trust Company
(212) 720-2530
----- Forwarded by Lisa Joniaux/NY/FRS on 09/16/2008 01:09 PM -----
Albert
Alvarado/NY/FRS
To Benecia Cousin/NY/FRS@FRS, Ada Li/NY/FRS@FRS,
Roger Graham/NY/FRS@FRS, Wendy Ng/NY/FRS@FRS
cc Lisa Joniaux/NY/FRS@FRS, William
09/15/2008 08:01 PM Carlucci/NY/FRS@FRS, Anna Ng/NY/FRS@FRS
Subject AIG settling banks
fyi -
BOG-- FOIA 10-251 --001069

(b)(4) & (b)(8)
BOG-- FOIA 10-251 --001070

From: Joshua L Mazen
To: Jeff Stehm
Subject: Re: Fw: AIG FSB information
Date: 09/16/2008 01:20 PM
Jeff,
This FSB entity is eligible for Fedwire funds and securities. So far today, the ABA is
active in funds but not securities.
--Josh
Josh Mazen
202-452-2373
▼ Jeff Stehm/BOARD/FRS
Jeff
Stehm/BOARD/FRS
To Joshua L Mazen/BOARD/FRS@BOARD
cc
09/16/2008 01:10 PM Subject Fw: AIG FSB information
Josh,
Please confirm for me the Fedwire funds and securities access for this
FSB entity.....ABA below.
Jeff Stehm
Associate Director
202-452-2217 (office)
202-412-9846 (cell)
Danielle E
Little/BOARD/FRS
To Jeffrey Marquardt/BOARD/FRS@BOARD, RBOPS
PAYMENT SYSTEM RISK, Jeff
09/15/2008 01:32 PM cc
Subject AIG FSB information
BOG-- FOIA 10-251 --001071

Duplicate
BOG-- FOIA 10-251 --001072

To: brian.f.madigan@frb.gov; william.b.english@frb.gov; James A Clouse
Subject: Fw: AIG drawing on its credit line
Date: 09/16/2008 01:22 PM
----- Forwarded by Patrick M Parkinson/BOARD/FRS on 09/16/2008 01:21 PM -----
Edgar
Moreano/NY/FRS@FRS
Andrew Small/NY/FRS@FRS, Anthony
Cirillo/NY/FRS@FRS, Arthur Angulo/NY/FRS@FRS,
09/16/2008 01:05 PM Barbara Yelcich/NY/FRS@FRS, Bard
Stermasi/NY/FRS@FRS, Bin Lang/NY/FRS@FRS,
Brandon Hall/NY/FRS@FRS, Brian
Begalle/NY/FRS@FRS, Brian Hefferle/NY/FRS@FRS,
Brian Peters/NY/FRS@FRS, Bridget
Habib/NY/FRS@FRS, Caroline Nuffort/NY/FRS@FRS,
Catherine Voigts/NY/FRS@FRS, Chris
Haley/BOS/FRS@FRS, Christina
Zausner/NY/FRS@FRS, Christine E
Schwaninger/BOARD/FRS@BOARD, Christopher
Stefansson/BOARD/FRS@BOARD, Craig
Leiby/NY/FRS@FRS, Daniel Muccia/NY/FRS@FRS,
Deborah Lohnau/NY/FRS@FRS, Dexter
Williams/NY/FRS@FRS, Dianne
Dobbeck/NY/FRS@FRS, H Clay Saylor/NY/FRS@FRS,
Homer Hill/NY/FRS@FRS, Isabella Lo
Piccolo/NY/FRS@FRS, James Hodgetts/NY/FRS@FRS,
Jan Voigts/NY/FRS@FRS, Jane
Wakefield/NY/FRS@FRS, Jeanmarie
Davis/NY/FRS@FRS, Jeffrey Levine/NY/FRS@FRS,
Jennifer Burns/RICH/FRS@FRS, Jim
Mahoney/NY/FRS@FRS, John Beebe/RICH/FRS@FRS,
John Harvey/NY/FRS@FRS, John
Heinze/NY/FRS@FRS, John Ricketti/NY/FRS@FRS, Jon
D Greenlee/BOARD/FRS@BOARD, Jonathan
Polk/NY/FRS@FRS, Jordan Pollinger/NY/FRS@FRS,
Joseph Galati/NY/FRS@FRS, Joshua
Sherwin/NY/FRS@FRS, Judith J
Gruttman/NY/FRS@FRS, Kara Sulmasy/NY/FRS@FRS,
Karen Kahrs/NY/FRS@FRS, Katheryn Van der
Celen/NY/FRS@FRS, Kenton Beerman/NY/FRS@FRS,
Kevin Clarke/NY/FRS@FRS, Kevin
Coffey/NY/FRS@FRS, Kevin Lee/NY/FRS@FRS, Kirsten
Harlow/NY/FRS@FRS, Kyle Grieser/NY/FRS@FRS,
Lance Auer/NY/FRS@FRS, Lawrence
ROSTOKER/NY/FRS@FRS, Laxmi Rao/NY/FRS@FRS,
Lucinda M Brickler/NY/FRS@FRS, Luis
Uranga/NY/FRS@FRS, Mark Scapp/NY/FRS@FRS,
Michael Johnson/SF/FRS@FRS, Nancy R
Berlad/BOARD/FRS@BOARD, Patrick M
Parkinson/BOARD/FRS@BOARD, Paul
Whynott/NY/FRS@FRS, Randolph
Brown/NY/FRS@FRS, Richard Kunen/NY/FRS@FRS,
Richard McGee/NY/FRS@FRS, Robert
Gutierrez/NY/FRS@FRS, Roger Graham/NY/FRS@FRS,
Ronald Stroz/NY/FRS@FRS, Sandy
Krieger/NY/FRS@FRS, Sarah Dahlgren/NY/FRS@FRS,
Stephanie Chaly/NY/FRS@FRS, Steven J
Manzari/NY/FRS@FRS, Steven Mirsky/NY/FRS@FRS,
Susan G Ballinger/NY/FRS@FRS, Susan
Goldberg/NY/FRS@FRS, Theodore
Lubke/NY/FRS@FRS, Theonilla Lee-
BOG-- FOIA 10-251 --001073

Chan/NY/FRS@FRS, Thomas J O'Keeffe/NY/FRS@FRS,
Tim P Clark/BOARD/FRS@BOARD, Todd
Hallacy/NY/FRS@FRS, Wing Oon/NY/FRS@FRS
cc James DeFalco/NY/FRS@FRS, Erin
Upton/NY/FRS@FRS, Gregory Gaare/NY/FRS@FRS,
Christopher Hunter/NY/FRS@FRS, Jennifer
Tranter/NY/FRS@FRS, Antonino
Piscitello/NY/FRS@FRS, Jeffrey Levine/NY/FRS@FRS,
Laura Braverman/NY/FRS@FRS, Theonilla Lee-
Chan/NY/FRS@FRS, Benjamin Eddy/NY/FRS@FRS,
Barbara Yelcich/NY/FRS@FRS, Steven J
Manzari/NY/FRS@FRS, Gregory Gaare/NY/FRS@FRS
Subject AIG drawing on its credit line
Duplicate
BOG-- FOIA 10-251 --001074

From: Lisa Joniaux
To: Jeff Stehm
Subject: Re: Fw: DTC intraday balance report
Date: 09/16/2008 01:22 PM
Attachments: DEPOSITORY TC 20080915.pdf
Not Responsive
OK - (b)(4) & (b)(8)
Lisa Joniaux
(212) 720-2530
Jeff
To Lisa Joniaux/NY/FRS@FRS
cc
09/16/2008 01:16 PM Subject
Re: Fw: DTC intraday balance report
Not Responsive
(b)(5)&(b)(8)
Jeff Stehm
Associate Director
202-452-2217 (office)
(b) (6)
▼ Lisa Joniaux/NY/FRS@FRS
Lisa
Joniaux/NY/FRS@FRS
cc Jeffrey Marquardt/BOARD/FRS@BOARD, Lawrence
Sweet/NY/FRS@FRS, Marsha Takagi/NY/FRS@FRS,
BOG-- FOIA 10-251 --001075

09/16/2008 01:07 PM Susan V Foley/BOARD/FRS@BOARD, William
Carlucci/NY/FRS@FRS
Subject
Re: Fw: DTC intraday balance report
Not Responsive
Lisa Joniaux
(212) 720-2530
Jeff
To Lisa Joniaux/NY/FRS@FRS, William
Carlucci/NY/FRS@FRS
cc Jeffrey Marquardt/BOARD/FRS@BOARD,
09/16/2008 12:18 PM Lawrence Sweet/NY/FRS@FRS, Marsha
Takagi/NY/FRS@FRS, Susan V
Foley/BOARD/FRS@BOARD
Subject Fw: DTC intraday balance report
(b)(4) & (b)(8)
Jeff Stehm
Associate Director
202-452-2217 (office)
(b) (6)
Danielle E
Little/BOARD/FRS
cc
09/16/2008 12:04 PM Subject DTC intraday balance report
Jeff,
Please see attached.
BOG-- FOIA 10-251 --001076

Danielle
Danielle Little
202.452.2605
danielle.e.little@frb.gov
BOG-- FOIA 10-251 --001077

Not Responsive
BOG-- FOIA 10-251 --001078

To: Diann Townsend; Kwayne Jennings
Cc: Ron Feldman
Subject: Re: Additional Exposure Information
Date: 09/16/2008 01:22 PM
If you believe u r not getting the information you need this is a fine time to contact
the bank directly
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
▼ Diann Townsend

From: Diann Townsend
Sent: 09/16/2008 12:20 PM CDT
To: Coryann Stefansson; Kwayne Jennings
Cc: Ron Feldman
Subject:
(b)(4), (b)(5), & (b)(8)
Not Responsive
Diann Townsend
Supervision, Regulation, and Credit
Federal Reserve Bank of Minneapolis
612-204-6130
BOG-- FOIA 10-251 --001079

From: Ralph Santasiero
Subject: BNYM 9/16 Mid-Day Update
Date: 09/16/2008 01:24 PM
Here are consolidated notes from discussions held with BNYM mgmt through mid-
day:
Credit Update
(b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --001080

From: Philip Aquilino
Cc: Michael Johnson; Coryann Stefansson; Nancy J Oakes; Jennifer Su; Jeffrey Plaskett; Fred Minardi; Michele
Magidoff; Robert Speaks; Donna O'Kane; Teresa Curran; Steve Hoffman; David M Wright; Jon D Greenlee
Subject: WFC 9/16 Update (as of 10:15am PST)
Date: 09/16/2008 01:28 PM
Restricted F.R.
AIG (b)(4) & (b)(8)
Not Responsive
BOG-- FOIA 10-251 --001081

Not Responsive
BOG-- FOIA 10-251 --001082

To: Sabeth I Siddique; Brian P Valenti
Subject: Fw: WFC 9/16 Update (as of 10:15am PST)
Date: 09/16/2008 01:29 PM
see below - looks like the MAC clauses are going to be invoked.
Jon Greenlee
Associate Director
Phone (202) 452-2962
Philip
Aquilino/SF/FRS@FRS
To NY Bank Sup - LFI CPC Updates
cc Michael Johnson/SF/FRS@FRS, Coryann
Stefansson/BOARD/FRS@BOARD, Nancy J
09/16/2008 01:28 PM Oakes/BOARD/FRS@BOARD, Jennifer Su/SF/FRS@FRS,
Jeffrey Plaskett/SF/FRS@FRS, Fred
Minardi/SF/FRS@FRS, Michele Magidoff/SF/FRS@FRS,
Robert Speaks/SF/FRS@FRS, Donna
O'Kane/SF/FRS@FRS, Teresa Curran/SF/FRS@FRS,
Steve Hoffman/SF/FRS@FRS, David M
Wright/SF/FRS@FRS, Jon D
Subject WFC 9/16 Update (as of 10:15am PST)
Restricted F.R.

Duplicate
BOG-- FOIA 10-251 --001083

From: Alain P Chaboud
To: Nathan Sheets; Steven Kamin; Michael Leahy; David H Bowman
Subject: AIG's ability to trade foreign exchange on EBS (confidential)
Date: 09/16/2008 01:34 PM
Importance: High
(b)(4) & (b)(8)
I spoke to Niall Coffey at FRBNY about this.
BOG-- FOIA 10-251 --001084

From: JNellie Liang
To: Rita C Proctor; Donald L Kohn; Kevin Warsh; Randall S Kroszner; Elizabeth A Duke
Cc: Brian F Madigan; Patrick M Parkinson; Daniel M Covitz; Gustavo A Suarez
Subject: Revised version of memo on commercial paper market conditions
Date: 09/16/2008 01:36 PM
Attached is memo on CP with the charts and tables attached.
BOG-- FOIA 10-251 --001085

(b) (5)
BOG-- FOIA 10-251 --001086

(b) (5)
BOG-- FOIA 10-251 --001087

(b) (5)
BOG-- FOIA 10-251 --001088

(b) (5)
BOG-- FOIA 10-251 --001089

(b) (5)
BOG-- FOIA 10-251 --001090

(b) (5)
BOG-- FOIA 10-251 --001091

(b) (5)
BOG-- FOIA 10-251 --001092

(b) (5)
BOG-- FOIA 10-251 --001093

From: Scott Alvarez
To: Neel.Kashkari@do.treas.gov
Date: 09/16/2008 01:42 PM
Neel,
(b) (5)
Thanks!
Scott
▼ Neel.Kashkari@do.treas.gov
Neel.Kashkari@do.treas.gov
To scott.alvarez@frb.gov
cc
09/16/2008 10:17 AM
Subject Re: fund insert
Duplicate
BOG-- FOIA 10-251 --001094

From: Elizabeth A Duke
Subject: Re: Fw: AIG -WFC 9/16 Update (as of 10:15am PST)
Date: 09/16/2008 01:53 PM
(b) (5)
Deborah P
Bailey/BOARD/FRS
To Donald L Kohn/BOARD/FRS@BOARD, Randall S
Duke/BOARD/FRS@BOARD
09/16/2008 01:40 PM cc
Subject Fw: AIG -WFC 9/16 Update (as of 10:15am PST)
Info from our Wells Fargo team.

Jon D
Greenlee/BOARD/FRS
cc
09/16/2008 01:30 PM Subject Fw: WFC 9/16 Update (as of 10:15am PST)
Duplicate
BOG-- FOIA 10-251 --001095

To: Elizabeth A Duke
Subject: Re: Fw: AIG -WFC 9/16 Update (as of 10:15am PST)
Date: 09/16/2008 01:58 PM
(b) (5)
--------------------------
▼ Elizabeth A Duke

From: Elizabeth A Duke
Sent: 09/16/2008 01:53 PM EDT
To: Deborah Bailey
Subject: -WFC 9/16 Update (as of 10:15am PST)
(b) (5)
Deborah P
Bailey/BOARD/FRS
To Donald L Kohn/BOARD/FRS@BOARD, Randall S
Duke/BOARD/FRS@BOARD
09/16/2008 01:40 PM cc
Subject Fw: AIG -WFC 9/16 Update (as of 10:15am PST)
Duplicate
BOG-- FOIA 10-251 --001096

From: Jennifer A Lucier
To: Marsha Takagi
Cc: Elizabeth Tafone
Subject: Re: Fw: Meeting Minutes Payments and Settlement and Tri-Party Calls September 16, 2008
Date: 09/16/2008 02:03 PM
Marsha,
Liz pointed me in the right direction - here are the draft minutes - bolded text seems
consistent with what you mentioned in your earlier message regarding not saying
anything too difinitive:
Not Responsive
(b)(4) & (b)(8)
Jennifer A. Lucier
Project Leader
Clearance and Settlement Systems
(202) 872-7581 (office)
(b) (6)
jennifer.a.lucier@frb.gov
▼ Marsha Takagi/NY/FRS@FRS
Marsha
Takagi/NY/FRS@FRS
To Jennifer A Lucier/BOARD/FRS@BOARD
cc Elizabeth Tafone/NY/FRS@FRS
09/16/2008 01:54 PM Subject Re: Fw: Meeting Minutes Payments and Settlement
and Tri-Party Calls September 16, 2008
Not Responsive
BOG-- FOIA 10-251 --001097

Not Responsive
BOG-- FOIA 10-251 --001098

Not Responsive
BOG-- FOIA 10-251 --001099

Not Responsive
BOG-- FOIA 10-251 --001100

From: Paul S Webster
Cc: Eric Rosengren; Jim Nolan; Jackie Palladino; Maureen B Savage
Subject: Fw: RBS Funding Update - 9/16/08
Date: 09/16/2008 02:11 PM
----- Forwarded by Paul S Webster/BOS/FRS on 09/16/2008 02:09 PM -----
Jennifer
Hynes/BOS/FRS
To Tony Bardascino/RICH/FRS@FRS, Theresa
Barry/BOS/FRS@FRS, Paul S Webster/BOS/FRS@FRS,
Scott Strah/BOS/FRS@FRS, Timothy
09/16/2008 01:12 PM Daniels/BOS/FRS@FRS, Ken Fortier/BOS/FRS@FRS,
Erin Long/BOS/FRS@FRS, Chris Haley/BOS/FRS@FRS
cc
Subject RBS Funding Update - 9/16/08
Not Responsive
RBS Group:
BOG-- FOIA 10-251 --001101

(b)(4) & (b)(8)
Not Responsive
Jennifer W. Hynes
Supervision, Regulation and Credit Department
617-973-3827 / 617-662-4747 (tel)
617-973-3265 (fax)
jennifer.hynes@bos.frb.org
BOG-- FOIA 10-251 --001102

From: Scully, Robert (FM)
To: kevin.warsh@frb.gov
Subject: Fw: Market impact
Date: 09/16/2008 02:32 PM
Attachments: 2008 09 15 Implications of Bankrupcy.ppt
2008 09 16 To Do List.ppt
Believe these are the docs you requested.

From: Ryan, Kevin (GCM)
To: Scully, Robert (FM); Juhas, Peter (IBD)
Sent: Tue Sep 16 14:27:34 2008
Subject: RE: Market impact
See attached.
Kevin Ryan, Managing Director

Morgan Stanley | Global Capital Markets
1585 Broadway | Floor 04
New York, NY 10036
Phone: +1 212 761-2825
Fax: +1 212 507-2944
Kevin.J.Ryan@morganstanley.com
From: Scully, Robert (FM)
Sent: Tuesday, September 16, 2008 2:19 PM
To: Ryan, Kevin (GCM); Juhas, Peter (IBD)
Subject: Market impact
The sheets done last night on market impact, would you forward them to me asap ...with the
GSE disclaimer somewhere. Very urgent.
NOTICE: If received in error, please destroy and notify sender. Sender does not intend to waive confidentiality or privilege.
Use of this email is prohibited when received in error. - 2008_09_15 Implications of
Bankrupcy.ppt - 2008 09 16 To Do List.ppt
BOG-- FOIA 10-251 --001103

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001104

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001105

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001106

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001107

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001108

(b)(4) & (b)(5)
BOG-- FOIA 10-251 --001109

To: David Gibson; BSR LIG
Subject: Re: Breakout of Lehman and AIG exposures
Date: 09/16/2008 02:45 PM
I think there may already exist the list for the lfis...
Coryann Stefansson
Associate Director
Work # 202 452 5287
Cell # (b) (6)
▼ David Gibson

From: David Gibson
Sent: 09/16/2008 02:30 PM EDT
To: BSR LIG
Subject: Breakout of Lehman and AIG exposures
Good afternoon everyone,
A new project of high priority is in play. (b) (5) and (b) (8)

The deadline is 4:30, this will hopefully give me enough time to

summarize and turn it in by the time it is due to management (due to
management: COB TODAY).
Thank you
David W. Gibson Jr.

Large Institutions Group
Banking Supervision & Regulation
Phone: 202-530-6209
BOG-- FOIA 10-251 --001110

To: (b) (6)
Subject: Fw: Rita, please bring five copies in for Michelle Smith please.
Date: 09/16/2008 02:49 PM
Attachments: Rationale.doc
Emailing this to bb's desk, in case I need to edit it in here.
Sent: 09/16/2008 02:44 PM AST
To: Michelle Smith; Rita Proctor
Subject: Rita, please bring five copies in for Michelle Smith please.
Thanks.
Calvin Mitchell
- Rationale.doc
BOG-- FOIA 10-251 --001111

(b) (5)
BOG-- FOIA 10-251 --001112

From: Theodore Lubke
To: Lawton, John C.
Cc: Jennifer A Lucier; Lawrence Sweet
Subject: Re: aig
Date: 09/16/2008 03:07 PM
John - Thank you for this. Are you still around here or are you in DC? I'd like to
discuss.
Theo Lubke
Senior Vice President
theodore.lubke@ny.frb.org
tel: 212-720-6334
fax: 212-720-7818
http://www.newyorkfed.org
▼ "Lawton, John C." <jlawton@CFTC.gov>
"Lawton, John C."

<jlawton@CFTC.gov>
To <william.rutledge@ny.frb.org>,
<theodore.lubke@ny.frb.org>
cc "Lukken, Walter" <wlukken@CFTC.gov>, "Loesch,
09/16/2008 02:54 PM Michael" <MLoesch@CFTC.gov>, "Radhakrishnan,
Ananda" <ARadhakrishnan@CFTC.gov>, "Smith,
Thomas J." <tsmith@CFTC.gov>, "Wasserman, Robert
B." <rwasserman@CFTC.gov>, "Markman, Natalie A."
<nmarkman@CFTC.gov>
Subject aig
Michael Loesch asked me to pass on the following info. (b)

(5)
BOG-- FOIA 10-251 --001113

To: Calvin Mitchell
Subject: Re: Where do we stand?
Date: 09/16/2008 03:15 PM
It was just approved by the board.

Terms are going to aig now. Aig has a board mtg at 5.
▼ Calvin.Mitchell

Sent: 09/16/2008 03:17 PM AST
To: Michelle Smith
Subject: Where do we stand?
BOG-- FOIA 10-251 --001114

Subject: AIG note
Date: 09/16/2008 03:28 PM
Attachments: Background for Decision to Lend to AIG.doc
This could use some further work.
BOG-- FOIA 10-251 --001115

(b) (5)
BOG-- FOIA 10-251 --001116

From: Rich Ashton
To: Mark VanDerWeide; Sophia H Allison
Subject: Fw: Revised AIG Term Sheet
Date: 09/16/2008 06:43 PM
Attachments: 2008 09 16 Term Sheet.doc
DV Comparison 2008 09 16 Term Sheet.080916 1316-2008 09 16 Term Sheet.rtf
AIG resolution II.doc
This is what the Board adopted today. At this point its just an authorization.
Not sure any decision to lend has been made as of yet.

----- Forwarded by Rich Ashton/BOARD/FRS on 09/16/2008 06:40 PM -----
Scott
Alvarez/BOARD/FRS
To Rich Ashton/BOARD/FRS@BOARD
cc
09/16/2008 03:42 PM Subject Fw: Revised AIG Term Sheet
----- Forwarded by Scott Alvarez/BOARD/FRS on 09/16/2008 03:42 PM -----
Jeremiah.Norton@do.treas.gov
To scott.alvarez@frb.gov
cc
09/16/2008 02:28 PM
Subject Fw: Revised AIG Term Sheet
Duplicate
BOG-- FOIA 10-251 --001117

RESOLUTION
Given the unusual and exigent circumstances and pursuant to section 13(3)
of the Federal Reserve Act, the Board authorizes the Federal Reserve Bank
of New York to extend credit to American International Group, Inc. (AIG)
or any of its subsidiaries if the New York Reserve Bank obtains evidence
that the borrower is unable to secure adequate credit accommodations from
other banking institutions.
The credit should be secured to the satisfaction of the Reserve Bank, and
should not exceed a period of 24 months, subject to extension by the
Reserve Bank after consultation with the Board. The New York Reserve
Bank may, as it deems appropriate, impose conditions, such as those
described in its proposed lending facility term sheet, on its extension of
credit to AIG.
The Board approves the recommendation of the Federal Reserve Bank of
New York that the credit to AIG be extended at the credit rates in the
Reserve Bank’s proposed lending facility term sheet.
BOG-- FOIA 10-251 --001118

Subject: Fw: Raw Materials for our early morning meeting with Tim.
Date: 09/17/2008 09:25 AM
Attachments: Proposal to Reinsure Stable Value Fund Business for AIG.doc
Systemic Issues in AIG failure.doc
Systemic Impact of AIG Bankruptcy.DOC
Pros and Cons of Lending to AIG.doc
Retail nature.doc
LEGALDOCS-#283317-v3-One Pager re AIG Bankruptcy Considerations.DOC
Summary of AIG's market risk positioning.doc
AIG Summary 16 September 2008.doc
jclouse@frb.gov
cell: 703-304-6276
Alejandro
LaTorre/NY/FRS@FRS
To James A Clouse/BOARD/FRS@BOARD
cc
09/17/2008 09:00 AM Subject Fw: Raw Materials for our early morning meeting with
Tim.
Jim,
These are the documents. If there are questions, or I can be of assistance, let me
know. (b) (5)
Regards,
Alex.
----- Forwarded by Alejandro LaTorre/NY/FRS on 09/17/2008 08:54 AM -----
Alejandro
LaTorre/NY/FRS
To Michael Silva/NY/FRS, Meg McConnell/NY/FRS
LaTorre/NY/FRS@FRS, Alexa Philo/NY/FRS@FRS,
09/16/2008 01:08 PM Alexander J Psomas/NY/FRS@FRS, Bard
Stermasi/NY/FRS@FRS, Catherine Voigts/NY/FRS@FRS,
Christopher Calabia/NY/FRS@FRS, Danielle
Vicente/NY/FRS@FRS, Denise Goodstein/NY/FRS@FRS,
Dianne Dobbeck/NY/FRS@FRS, Elise
Liebers/NY/FRS@FRS, Erika Gottfried/NY/FRS@FRS,
Jim Mahoney/NY/FRS@FRS, Kevin
Coffey/NY/FRS@FRS, Mark Scapp/NY/FRS@FRS, Min
Kim/NY/FRS@FRS, Paul Whynott/NY/FRS@FRS, Tobias
Adrian/NY/FRS@FRS, Hayley Boesky/NY/FRS@FRS,
Richard Charlton/NY/FRS@FRS, Azish
Filabi/NY/FRS@FRS, James Hennessy/NY/FRS@FRS
Subject Raw Materials for our early morning meeting with Tim.
BOG-- FOIA 10-251 --001119

To be ensure we all have the same docs; am sending around what I've received as
input into Tim's summary document from yesterday.
If I've left something out please distribute to the group. I'll defer to banksup as to
whether they want to circulate exposure figures as this is confidential.
- AIG Summary 16 September 2008.doc
BOG-- FOIA 10-251 --001120

(b) (5)
-1-
BOG-- FOIA 10-251 --001121
(b) (5)
-2-
BOG-- FOIA 10-251 --001122
(b)(4) & (b)(5)
-3-
BOG-- FOIA 10-251 --001123
(b) (5)
BOG-- FOIA 10-251 --001124

(b) (5)
BOG-- FOIA 10-251 --001125

(b) (5)
BOG-- FOIA 10-251 --001126

(b) (5)
BOG-- FOIA 10-251 --001127

(b) (5)
BOG-- FOIA 10-251 --001128

(b) (5)
1
BOG-- FOIA 10-251 --001129
(b) (5)
2
BOG-- FOIA 10-251 --001130
(b) (5)
BOG-- FOIA 10-251 --001131

(b) (5)
BOG-- FOIA 10-251 --001132

(b) (5)
BOG-- FOIA 10-251 --001133

(b) (5)
BOG-- FOIA 10-251 --001134

Defendant Federal Reserve Document Production On AIG From Sept 2008 Heavy Redactions (Lawsuit #3)

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Defendant Federal Reserve Document Production On AIG From Sept 2008 Heavy Redactions (Lawsuit #3)

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From: (b) (4)

To: Patrick.M.Parkinson@frb.gov; terrence.checki@ny.frb.org; spence.hilton@ny.frb.org

AIG traded up to 755 for 5 yr CDS---t the one that worries

BOG-- FOIA 10-251 --000001

Sounds like they are getting nervous. Pat

BOG-- FOIA 10-251 --000002

Do you have some text on this?

BOG-- FOIA 10-251 --000003

No. TFG related on conference call. Firm is expecting downgrade, worried

----- Original Message -----

BOG-- FOIA 10-251 --000004

BOG-- FOIA 10-251 --000005

Do you guys have an expert on AIG? I thought I would ask before

BOG-- FOIA 10-251 --000006

BOG-- FOIA 10-251 --000007

BOG-- FOIA 10-251 --000008

BOG-- FOIA 10-251 --000009

Hi Bill--I have been completely swamped with forecast issues, so I am afraid I am

BOG-- FOIA 10-251 --000010

----- Forwarded by Gustavo A Suarez/BOARD/FRS on 09/12/2008 01:13 PM -----

BOG-- FOIA 10-251 --000011

Take this with a grain of salt, but is refle

----- Original Message -----

BOG-- FOIA 10-251 --000012

Consistent with other rumblings. Pat

----- Original Message -----

BOG-- FOIA 10-251 --000013

BOG-- FOIA 10-251 --000014

A significant portion of AIGFP’s guaranteed investment agreements (GIAs) and financial

It is estimated that, as of the close of business on July 31, 2008, based on AIGFP’s

Furthermore, a downgrade of AIG’s long-term senior debt ratings to ‘A1’ by Moody’s

BOG-- FOIA 10-251 --000015

AIG May Announce Its Turnaround Plan Before Sept. 25 (Update2)

By Hugh Son and Shannon D. Harrington

BOG-- FOIA 10-251 --000016

BOG-- FOIA 10-251 --000017

BOG-- FOIA 10-251 --000018

----- Forwarded by Gustavo A Suarez/BOARD/FRS on 09/12/2008 05:24 PM -----

BOG-- FOIA 10-251 --000019

----- Original Message -----

BOG-- FOIA 10-251 --000020

Just let me know.

BOG-- FOIA 10-251 --000021

BOG-- FOIA 10-251 --000022

AIG FSB is a federally chartered thrift headquartered in Wilmington DE (3rd Dist).

Has borrowing docs but no collateral.

BOG-- FOIA 10-251 --000023

BOG-- FOIA 10-251 --000024

Mobility of liquidity – most cash within the organization is ‘trapped’ in regulated

Plans to address liquidity stress? AIG is aggressively pursuing:

Unwinding in event of bankruptcy is likely to be very messy, because derivatives

Access to Fed facilities:

BOG-- FOIA 10-251 --000025

AIG Meeting Notes

Plans to address liquidity stress? AIG is aggressively pursuing:

Unwinding in event of bankruptcy is likely to be very messy, because derivatives book is

Access to Fed facilities:

Jon and Mike,

BOG-- FOIA 10-251 --000029

BOG-- FOIA 10-251 --000030

What time are you leaving?

BOG-- FOIA 10-251 --000031

I have an 11 AM call and one at 1 PM, but I can miss those if