a lot of planholders right now are so worried about their investments with Philamlife insurance company coz of the news last 2 weeks ago.. here's the story
The country’s largest insurance company, Philippine American Life and General Insurance Co. (Philamlife), is up for grabs as part of the global streamlining of its beleaguered parent company, American International Group Inc. (AIG).
In a statement last night, Philamlife said that "it had been identified for possible divestment along with some its affiliates."
The statement followed an announcement by AIG in New York that it would refocus on core property and casualty insurance business worldwide after receiving an $85 billion lifeline from the US Federal Reserve.
AIG, one of the world's biggest insurers, unveiled its intention to sell many "extremely valuable" assets and identified Philamlife as one of them.
Even before AIG made the announcement, Philamlife has attracted a number of suitors, including the Yuchengco group of companies.
Philamlife president and CEO Jose Cuisia Jr. said in a statement: "Philamlife remains to be (a) stable and strongly capitalized organization. Our policyowners and clients can be assured that their interests are protected because of the company's financial strength."
"A change of ownership will not in anyway diminish policyowners' benefits and security," Cuisia said. "We will remain focused on daily execution of our business and continue to provide our policyowners and clients with the highest levels of service."
AIG announced in New York its intention to restructure operations in order to emerge as a "smaller but more nimble" company that is solidly profitable and has good long-term growth prospects.
The group has appointed The Blackstone Group and JP Morgan as its global coordinators for the divestiture program.
"Philamlife, the largest and most profitable insurance company in the country and the undisputed market leader for over 60 years, is a crown jewel for AIG and will surely attract local and international interest," Philamlife said in its statement.
The Yuchengcos' Great Pacific Life Assurance Corp. (Grepalife) and Malayan Insurance Co., Inc. earlier announced their intention to pool resources to make a bid for Philamlife, which has consolidated assets of P170 billion, or over eight times bigger than their combined resources.
Philamlife's life insurance business alone has a net worth of P21.4 billion as of end-2007.
Aside from life insurance, AIG has interests in non-life insurance, banking, mutual funds and pre-need businesses in the Philippines.
Grepalife is the sixth biggest life insurer in terms of net worth (P3.65 billion) while Malayan Insurance is the biggest in terms of both assets (P11.57 billion) and net worth (P4 billion) among non-life insurers.
Cuisia earlier said that aside from the Yuchengcos, there were other groups that had expressed interest in Philamlife.
In New York, AIG said Friday it planned to sell off a number of business units to pay off its massive government loan, while retaining its US property and casualty and foreign general insurance businesses.
AIG also said it planned to retain an ownership interest in its foreign life insurance operations.
AIG's traditional insurance subsidiaries have widely been viewed as safe and are likely to attract buyers. The New York-based insurer said it had already been contacted by a number of suitors.
One unit that analysts have said could be sold is the International Lease Finance Corp., which leases out more than 900 aircraft with asset values topping $44 billion at the end of the second quarter.
Brink of failure
Other businesses AIG operates include life, commercial auto and accident and health insurers.
On the brink of failure last month, AIG was bailed out when the US government offered it a two-year $85 billion loan to avoid bankruptcy during one of the most tumultuous times during the ongoing credit crisis that saw Lehman Brothers Holdings Inc. file for bankruptcy protection and the sale of Merrill Lynch & Co. to Bank of America Corp.
In return for the loan, the US government received warrants to purchase up to 79.9 percent of AIG.
As of Sept. 30, AIG had drawn $61 billion on the credit facility.
Shortly after AIG struck its deal with the US government, newly appointed Chairman and Chief Executive Edward Liddy said he planned to quickly raise funds through asset sales, but hoped to hold on to as many of AIG's insurance operations as he can.
The sale of some of its businesses will be used to pay off the outstanding government loan, which was made by the Federal Reserve Bank of New York. Additional funds will be used to help address the company's capital structure.
Problems at AIG did not come from its traditional insurance subsidiaries, but instead from its financial services operations, and primarily its insurance of mortgage-backed securities and other risky debt against default.
If AIG couldn't make good on its promise to pay back soured debt, investors feared the consequences would pose a threat to the US financial system, which led to the government bailout.
AIG said it was actively working on alternatives for its financial products business and its securities lending program.
Last week, billionaire investor Warren Buffett said his firm, Berkshire Hathaway Inc., would be interested in acquiring a couple of AIG's assets depending on what the company was willing to sell. With a report from AP...
we just hope and pray that the money of the planholders are safe and in good hands as what they've promised.
and if ur one of the planholders with philamlife insurance company, visit the nearest philamlife office for more information and inquiries.