AIG reports $4.4 billion loss in Q1
The New York-based insurance giant said it lost $4.35 billion, or $1.98 per share, during the quarter ended March 31, compared with $7.81 billion, or $3.09 per share, during the same quarter last year. Insurer American International Group Inc (AIG), whose near collapse in September fanned the global financial crisis, said Thursday it lost $4.4 billion in the first quarter. The New York-based insurance giant said it lost $4.35 billion, or $1.98 per share, during the quarter ended March 31, compared with $7.81 billion, or $3.09 per share, during the same quarter last year.
Historic loss
AIG lost $61.7 billion during the fourth quarter — the most ever in a quarter by a US corporation — amid the mushrooming credit crisis and shortly after its near collapse. The US Federal Reserve rescued AIG in September 2008, acquiring some 80 pc of its shares.
Warren Buffett’s firm loses USD 1.5 bn
Billionaire Warren Buffett’s investment firm Berkshire Hathaway said it lost USD 1.5 billion in the first quarter amid market turmoil as the value of its assets fell by USD 6.1 billion.
The investment company controlled by Buffett, the world’s second richest person, took a hit from its insurance holdings and a loss as it sold a big stake in oil giant Conoco Phillips. Berkshire said it set aside a reserve of USD 3.7 billion dollars for potential losses from insurance firms that offer credit default swaps, which insure against a default of bonds or other investments.The company has big stakes in General Re, a reinsurance firm, as well as US insurer GEICO. It also has stakes in the energy sector and Washington Post newspaper.
In the past year, it acquired stakes in investment bank Goldman Sachs and conglomerate General Electric as well as gum maker Wrigley and the insurer Swiss Re. Last month, ratings agency Moody’s Investors Service downgraded the “AAA” rating the billionaire investor’s Berkshire Hathaway, citing damage from falling stocks on its insurance business.
The firm posted a net profit of USD 4.99 billion for 2008, despite a deepening US recession and a global economic and financial crisis. Its assets, however, have lost nearly 10 per cent of their value, a performance unusually weak for Buffett, known as the “Oracle of Omaha” for his astute investment decisions.
DuPont to slash 2,000 positions
Chemicals firm DuPont will be slashing nearly 2,000 positions as the company embarks on cost cutting measures.
“Approximately 2,000 positions will be eliminated and certain assets will be rationalised as part of the restructuring plan,” DuPont said in a statement on Friday. The firm has a significant presence in India and has production facilities in the country for DuPont Engineering Polymers, DuPont Crop Protection products and DuPont Liquid Packaging Systems, among others. Last month, the entity had said it would reduce fixed cost by as much as $1 b this year.
“DuPont’s actions are intended to preserve its strong cash position and better position the company for global economic recovery following fundamental market place shifts and demand declines — particularly in motor vehicle, construction and industrial markets,” the statement noted. The restructuring plan is expected to deliver over $70 m benefit in 2009 and about $ 225 mn annual savings by year-end 2010. “A pre-tax charge for the restructuring plan will be taken in the second quarter totaling $ 340-390 m, of which approximately 40 pc is expected to be non-cash,” the firm said.
Sources : www.ProfitControl.in
CAclubindia
