Reporting from Washington — The Treasury Department has recovered 70% of the money distributed under the $700-billion bailout fund after insurance giant American International Group Inc. paid back $6.9 billion of the taxpayer bailout it received.
The once financially ailing AIG made the repayment Tuesday after selling its holdings in MetLife last week. About $59 billion from the Troubled Asset Relief Program still is invested in AIG.
Altogether, AIG received about $125 billion in a complex, multistep bailout from the Treasury and the Federal Reserve starting in the fall of 2008. The government owns 92% of AIG after a stock-conversion deal in January. That was part of an effort to recapitalize the insurance company and make it easier to unwind the federal stake later.
Outside the TARP money, the Fed has about $39 billion invested in AIG.
The stock-conversion deal was completed after the Congressional Budget Office estimated in November that the Treasury would lose $14 billion in TARP money on the AIG bailout. But the deal and a rise in AIG's stock price gave the Fed and Treasury Department confidence to predict that they would not lose any money.