S&P upgrades AIG

Rating agency Standard & Poor's (S&P) has revised its outlook for American International Group (AIG) from negative to stable and affirmed AIG’s A- long-term counterparty credit rating

S&P said the revisions were made as AIG is likely to maintain and improve its fixed-charge coverage on the back of stronger operating earnings and declining financial leverage, which has reduced interest expense.

The rating agency also affirmed ratings on various operating insurance company subsidiaries and raised the counterparty credit and financial strength ratings on AIG Korea to A+ from A.

"The stable outlook reflects our view that the holding company will maintain fixed-charge coverage of between 6x and 8x during the next two years and will improve in subsequent years. We also expect the group to maintain operating performance consistent with our base case, a very strong business risk profile, and extremely strong capital," S&P said.