American International Group’s profits jumped 53% during the first quarter of 2015, the insurance giant announced late last week.
Net income increased to $2.47 billion, supported largely by the sale of investment holdings, including a $500 million stake in Chinese insurer PICC Property & Casualty Co. Meanwhile,
AIG’s operating income dropped to $1.69 billion from $1.74 billion – a 2.9% decrease.
In addition to improving profits, AIG also announced it had bought back $1.14 billion in shares during the first quarter and had also repurchased an additional $800 million through the end of April. The buy backs are part of a board-authorized plan to take hold of shares worth up to $3.5 billion.
AIG also decreased its general expenses slightly, to which the company credits “investments in technology, engineering and analytics.”
The quarterly profit announcements were the second to come since Peter Hancock took over from Robert Benmosche as AIG chief executive. The results exceeded analyst expectations, who anticipated operating results of $1.19 share rather than the $1.22 posted by AIG.
Results also came during a quarter in which many large property/casualty insurers posted losses thanks to severe winter storms and other weather-related events.
AIG is currently one of three insurance companies – and the only property/casualty company to be designated by the Federal Reserve as a “systemically important financial institution” (SIFI).
The designation subjects AIG to federal oversight, though capital standards and other requirements for SIGI-designated companies have not yet been determined.
