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| Paulson: US will not bail out UK insurers | ||
| 2008-10-27 | ||
This excludes insurers such as Prudential, Friends Provident, Standard Life and Aviva, which have all suffered steep falls in their share prices this month despite giving reassurances about their capital strength. British insurers have been under scrutiny by the Financial Services Authority, which believes they are paying too little consideration to an increased risk of corporate bond defaults. Traders are fearful of insurers’ exposure to companies failing to meet obligations. Although Aviva and Prudential have formally denied any need to carry out a rights issue or raise fresh capital from existing shareholders, news that British insurers have sought US federal assistance is expected to undermine confidence in the insurance sector further. The US Treasury is understood to have told UK and American insurers that there will be no plans to expand its capital purchase programme, under which international banks can apply to sell troubled assets and an equity stake to Washington. Although Mr Paulson nationalised AIG, the world’s biggest insurer, last month at a cost of $84 billion (£53 billion) to the US taxpayer, he is understood to be at pains to emphasise that this bailout was an exception and that it did not open the door for other insurers to beg for rescue funds.
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| Posted by:lotp |
| #1 I wouldn't get to comfortable yet. In about 1 week the possiblity might be that Obama and his illuminati crew will be bailing out the rest of the world. Of course only the top 5% tax payers will be paying for the bill. |
| Posted by: Phusing Darling of the Munchkins4316 2008-10-27 22:26 |