Ratings

On Feb. 29, 2008, Standard & Poor's Ratings Services affirmed its 'AA' 
counterparty credit rating on American International Group Inc. (NYSE:AIG) and 
affirmed its 'AA+' counterparty credit and financial strength ratings on AIG's 
core operating subsidiaries (see ratings list). 
     The outlook remains negative. 
     The affirmation follows AIG's announcement of 2007 net income of $6.2 
billion, down 56% from the prior year. The earnings included charges of $7.5 
billion (after tax) for market valuation losses on AIG Financial Products 
(AIGFP) super senior credit default swap portfolio and an additional $1.7 
billion of other-than-temporary impairment charges on investments, largely 
related to U.S. residential mortgage-backed securities (MBS). These charges 
clearly exceeded Standard & Poor's expectations, but not by a level that would 
change the ratings. AIG's capitalization to absorb these losses is still 
considered very strong, with $95.8 billion of shareholders' equity as of Dec. 
31, 2007. 
     Standard & Poor's has put significant effort into modeling AIGFP's super 
senior exposure in order to evaluate the expected ultimate economic losses, 
which can differ significantly from reported accounting losses. In 
supplemental materials, AIG stated that its severe stress scenario produced an 
expected loss of $900 million. Standard & Poor's detailed best estimate 
approach, which used a different method, produced a slightly lower result. In 
addition, we also evaluated AIG's holdings using the same conservative method 
used in the detailed analysis of bond insurers published Feb. 25, 2008, and 
this method produced stressed losses of $3.5 billion. This range of outcomes 
is wide and highly sensitive to changes in assumptions, but in all cases is 
significantly lower than the reported accounting loss. 
     Given the current illiquid markets for MBS and related CDOs, it is not 
surprising that AIG's market valuations differ significantly from expected 
economic losses. It is important to note that AIGFP pulled back writing credit 
default swaps on CDOs with underlying subprime collateral in late 2005, and as 
a result, only 5% of its exposures are in the most problematic 2006 and 2007 
vintages. For this reason, AIG's risk profile is viewed as favorable to those 
of many peer institutions. AIGFP has not yet been required to pay any cash 
losses under these contracts. 
     AIG's core operating earnings in insurance, retirement services, and 
aircraft leasing businesses remain strong and form a strong offset to the 
negative results in AIGFP. However, earnings challenges persist in certain 
other AIG businesses due to the current conditions, most notably, mortgage 
insurance unit United Guaranty Corp. and consumer lender American General 
Finance Corp. 
 

The negative outlook reflects the continued uncertainty around estimating 
economic losses and fair market values in the U.S. mortgage market. Standard & 
Poor's believes that AIG will ultimately recover a meaningful portion of the 
2007 unrealized market valuation loss, but the timing and the amount are 
difficult to estimate. 
     Standard & Poor's could lower its ratings on AIG by one notch if ultimate 
economic losses develop to levels similar to the 2007 charge. However, if 
recoveries emerge and there is greater clarity around the ultimate loss level, 
the ratings may be affirmed and the outlook revised to stable. There is 
unlikely to be significant clarity around the ultimate losses for at least two 
quarters, and the result will be influenced by a potential recession or 
downturn in the U.S. economy. 
     In addition, Standard & Poor's remains concerned about the disclosure of 
a material weakness in controls around the valuation methods used for the 
AIGFP super senior portfolio. We recognize that market values are difficult to 
determine in the current illiquid markets, but so far AIG is the only major 
financial institution to report such a weakness. We are currently planning to 
review AIG's methods and controls in comparison with peers. If the weakness is 
considered to be significant, this could also result in a one-notch downgrade. 

Ratings Affirmed

American International Group Inc. 
 Counterparty Credit Rating             AA/Negative/A-1+   
 Senior Unsecured                       AA                 
 Preferred Stock
  Local Currency                        A+                 
 Commercial Paper
  Local Currency                        A-1+               

AIG Mexico Seguros Interamericana S.A. de C.V. 
 Counterparty Credit Rating
 Caval - Mexican Rating Scale           mxAAA/Stable/--    

21st Century Casualty Co. 
21st Century Insurance Co. of the Southwest 
21st Century Insurance Co. 
AIG Annuity Insurance Co. 
AIG Casualty Co. 
AIU Insurance Co. Taiwan 
AIU Insurance Co. 
American General Life Insurance Co. 
American Home Assurance Co. 
American Home Assurance Hong Kong 
American Home Assurance Malaysia 
American Home Assurance Singapore 
American International Assurance Co. (Bermuda) Ltd. 
American International Assurance Co. Ltd. 
American International Pacific Insurance Co. 
American International South Insurance Co. 
American Life Insurance Co. (DE) 
Commerce & Industry Insurance Co. 
First Sunamerica Life Insurance Co. 
Granite State Insurance Co. 
Illinois National Insurance Co. 
Insurance Co. of the State of Pennsylvania 
New Hampshire Insurance Co. Hong Kong 
New Hampshire Insurance Co. Thailand 
New Hampshire Insurance Co. 
United Guaranty Mortgage Indemnity Co. 
United Guaranty Residential Insurance Co. 
United States Life Insurance Co. in the City of New York 
Variable Annuity Life Insurance Co. 
 Counterparty Credit Rating
  Local Currency                        AA+/Negative/--    
 Financial Strength Rating
  Local Currency                        AA+/Negative/--    

AIG SunAmerica Life Assurance Co. 
National Union Fire Insurance Co. of Pittsburgh, PA 
 Counterparty Credit Rating
  Local Currency                        AA+/Negative/A-1+  
 Financial Strength Rating
  Local Currency                        AA+/Negative/--    

AIG-FP Matched Funding Corp. 
American General Assignment Services Trust 
United Guaranty Corp. 
 Counterparty Credit Rating
  Local Currency                        AA/Negative/--     

Banque AIG 
 Counterparty Credit Rating
  Local Currency                        AA/Negative/--     
 Senior Unsecured
  Local Currency                        AA                 
 Financial Program
  Local Currency                        AA/--/--           

SunAmerica Life Insurance Co. 
 Counterparty Credit Rating
  Local Currency                        AA+/Negative/A-1+  
 Financial Strength Rating
  Local Currency                        AA+/Negative/A-1+  

SunAmerica Life Insurance Co. (Separate Accounts) I 
 Counterparty Credit Rating
  Local Currency                        AA+/Negative/--    
 Financial Program
  Local Currency                        AA+/--/--          

United Guaranty Residential Insurance Co. of NC 
 Counterparty Credit Rating
  Local Currency                        AA-/Negative/--    
 Financial Strength Rating
  Local Currency                        AA-/Negative/--    

21st Century Insurance Group 
 Counterparty Credit Rating             AA/Negative/--     
 Senior Unsecured
  Local Currency                        AA                 

AHICO First American-Hungarian Insurance Co 
AIG Advantage Insurance Co. 
AIG Centennial Insurance Co. 
AIG Czech Republic Pojistovna, a.s. 
AIG Edison Life Insurance Co. 
AIG Europe (Ireland) Ltd. 
AIG Europe (Netherlands) N.V. 
AIG Europe S.A. 
AIG Excess Liability Insurance Company Ltd. 
AIG Excess Liability Insurance International Limited 
AIG Global Trade & Political Risk Insurance Co. 
AIG Hawaii Insurance Co. Inc. 
AIG Indemnity Insurance Co. 
AIG Poland Insurance Co. S.A. 
AIG Preferred Insurance Co. 
AIG Premier Insurance Co. 
AIG Slovakia Insurance Co. A.S. 
AIG U.K. Ltd. 
AIU Insurance Co. Foshan China Branch 
AIU Insurance Co. Guangzhou 
AIU Insurance Co. Shanghai Province 
AIU Insurance Co. Shenzhen China Branch 
AIU Japan 
ALICO Japan 
American General Life & Accident Insurance Co. 
American Home Assurance Co. (New Zealand Branch) 
American Home Japan 
American Home Korea 
American International Assurance Co (Australia) Ltd. 
American International Assurance Co. (Bermuda) Ltd. (New Zealand Branch) 
American International Assurance Co. (Bermuda) Ltd. - Korea Branch 
American International Insurance Co. of California 
American International Insurance Co. of New Jersey 
American International Insurance Co. of PR 
American International Insurance Co. 
American International Life Assurance Co. of New York 
Audubon Insurance Co. 
First American Czech Insurance Co. A.S. 
HSB Engineering Insurance Ltd. 
Landmark Insurance Co. 
New Hampshire Indemnity Co. Inc. 
 Financial Strength Rating
  Local Currency                        AA+/Negative/--    

AIG Financial Products Corp. 
 Counterparty Credit Rating             AA/Negative/A-1+   
 Senior Unsecured
  Local Currency                        AA                 

AIG Funding Inc. 
 Counterparty Credit Rating
  Local Currency                        --/--/A-1+         
 Commercial Paper
  Local Currency                        A-1+               

AIG Life Insurance Co. 
American International Specialty Lines Insurance Co. 
Lexington Insurance Co. 
 Counterparty Credit Rating
  Local Currency                        AA+/Negative/--    
 Financial Strength Rating
  Local Currency                        AA+/Negative/--    
 Financial Enhancement Rating
  Local Currency                        AA+/--/--          

AIG Life Insurance Co. of Canada 
AIG Life Insurance Co. of PR 
AIG United Guaranty Insurance (Asia) Ltd. 
 Financial Strength Rating
  Local Currency                        AA/Negative/--     

AIG Liquidity Corp. 
 Counterparty Credit Rating
  Local Currency                        --/--/A-1+         
 Financial Program
  Local Currency                        --/--/A-1+         

AIG Matched Funding Corp. 
 Counterparty Credit Rating
  Local Currency                        AA/Negative/A-1+   
 Senior Unsecured
  Local Currency                        AA                 
 Financial Program
  Local Currency                        AA/--/--           


AIG Life Holdings (US) Inc. 
 Counterparty Credit Rating
  Local Currency                        AA/Negative/--     

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