Fitch upgrades AIG

Fitch Ratings said it upgraded American International Group, Inc.'s (AIG) issuer default rating to A- from BBB+.

The ratings on AIG's senior debt obligations also are upgraded to BBB+ from BBB.

Fitch also upgraded AIG International, Inc.'s long-term issuer default rating to A- from BBB+ and the rating on its $175 million of 5.6% senior unsecured notes due July 31, 2097 to BBB+ from BBB.

The agency also upgraded American International Group's various senior unsecured note issues to BBB+ from BBB; $1 billion 4.125% senior unsecured notes due Feb. 15, 2024 to BBB+ from BBB; $1.5 billion 4.875% senior unsecured notes due June 2022 to BBB+ from BBB; $800 million 4.875% senior unsecured notes due Sept. 15, 2016 to BBB+ from BBB; €420.975 million of 6.797% senior unsecured notes due Nov. 15, 2017 to BBB+ from BBB; £323.465 million of 6.765% senior unsecured notes due Nov. 15, 2017 to BBB+ from BBB; £338.757 million of 6.765% senior unsecured notes due Nov. 15, 2017 to BBB+ from BBB; $256.161 million of 6.820% senior unsecured notes due Nov. 15, 2037 to BBB+ from BBB; $1 billion of 3.375% senior unsecured notes due Aug. 15, 2020 to BBB+ from BBB; $250 million 2.375% subordinated notes due Aug. 24, 2015 to BBB from BBB-; €750 million 8% series A-7 junior subordinated debentures due May 22, 2038 to BBB- from BB+; $4 billion 8.175% series A-6 junior subordinated debentures due May 15, 2058 to BBB- from BB+; £309.850 million 5.75% series A-2 junior subordinated debentures due March 15, 2067 to BBB- from BB+; €409.050 million 4.875% series A-3 junior subordinated debentures due March 15, 2067 to BBB- from BB+; £900 million 8.625% series A-8 junior subordinated debentures due May 22, 2068 to BBB- from BB+; $687.581 million 6.25% series A-1 junior subordinated debentures due March 15, 2087 to BBB- from BB+.

The agency also said it upgraded AIG Life Holdings, Inc.'s long-term issuer default rating to A- from BBB+; $150 million 7.5% senior unsecured notes due July 15, 2025 to BBB+ from BBB; $150 million 6.625% senior unsecured notes due Feb. 15, 2029 to BBB+ from BBB; $300 million 8.5% junior subordinated debentures due July 1, 2030 to BBB- from BB+; $500 million 7.57% junior subordinated debentures due Dec. 1, 2045 to BBB- from BB+; $500 million 8.125% junior subordinated debentures due March 15, 2046 to BBB- from BB+.

The insurer financial strength ratings of AIG's rated property/casualty insurance subsidiaries also are affirmed at A. The insurer financial strength ratings of its U.S. life insurance subsidiaries led by AGC Life Insurance Co. also are affirmed at A+.

In addition, the long-term senior secured ratings of securities issued by ASIF Global Financing, ASIF II Program and ASIF III Program were revised to A+ from A.

The outlook is stable.

The upgrades recognize the continued improvement in the organization's capital position and debt-servicing capabilities, Fitch said.

The company's financial leverage declined to 18% at year-end 2013 from 31% at year-end 2010, the agency said.

The upgrades also are based on a view that the improved earnings and dividend capacity of AIG's life and retirement segment can support the interest and debt service payments of the holding company, Fitch said.

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