The US government has announced a dramatic boost to an aid package for insurer American International Group, taking the total to more than $150 billion.
Under the restructuring of the government's aid package, the US Treasury will purchase $40 billion of newly issued AIG preferred shares under the Troubled Asset Relief Program.
This purchase will allow the Federal Reserve to reduce from $85 billion to $60 billion the total amount available under the credit facility, said a joint statement issued by the US Treasury Department and the Federal Reserve.
The Federal Reserve Bank of New York will also modify its credit line offered AIG.
The length of the facility will be extended from two years to five years.
