UPDATE 1-AIG reviewing dealings with Goldman, others

* Golub: AIG would work with Goldman if in its interest

* Benmosche sees AIG operating profit improving

* Net income volatility seen over next few quarters

By Paritosh Bansal

NEW YORK, May 12 (BestGrowthStock) – AIG is reviewing its dealings
with all its counterparties during the financial crisis,
including Goldman Sachs Group Inc (GS.N: ), to see if it was
harmed, Chief Executive Robert Benmosche said on Wednesday.

The bailed-out insurer will take appropriate action if it
finds something, Benmosche told shareholders at the annual
meeting, when asked if AIG would sue Goldman.

Goldman’s role in events that led to American International
Group Inc’s (AIG.N: ) September 2008 government rescue has come
under scrutiny. The investment bank was one of the largest
beneficiaries of the bailout money given to AIG’s
counterparties after the rescue.

AIG also incurred a loss last year as it ended trades with
Goldman on a security similar to the one at the center of a
U.S. Securities and Exchange Commission lawsuit against
Goldman.

Last week, a source told Reuters that AIG had canceled a
plan to hire Goldman for restructuring advice, turning instead
to Citigroup Inc (C.N: ) and Bank of America Corp (BAC.N: ).
[ID:nN07236015]

AIG Chairman Harvey Golub said Goldman was a “fine firm,”
and the insurer would work with the Wall Street bank if doing
so served its interests.

The shareholder meeting, the second since the government
took a nearly 80 percent stake in AIG, lasted only about half
an hour. It was held at the offices of AIG’s general insurance
unit, Chartis, a few minutes’ walk from AIG’s headquarters in
lower Manhattan.

AIG has agreed to sell its headquarters, and more of its
employees are set to move later this year to the building
housing Chartis’ offices at 180 Maiden Lane.

Benmosche, fresh from a first-quarter profit (Read more your timing to make a profit.), said he
expects operating profit to continue to show improvement.

But he warned that net income would be volatile over the
next few quarters because of accounting-related issues, like
amortization and goodwill.

AIG reported a first-quarter profit (Read more your timing to make a profit.) to the company of $1.5
billion. Continuing insurance operations earned $2.2 billion
before tax, up from $908 million a year earlier.

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(Reporting by Paritosh Bansal; editing by John Wallace)
(For more M&A news and our DealZone blog, go to (For more M&A
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UPDATE 1-AIG reviewing dealings with Goldman, others