At one stage AIG Investments was putting around $70bn into subprime bonds, according to a report
American International Group’s investment arm took on additional risks in its securities lending business, according to the Wall Street Journal.
At one point AIG Investments, which managed money for AIG's own insurance companies and outside investors, was putting about $70 billion into subprime mortgage bonds and other higher-risk assets, the report said citing, people familiar with the matter.
This helped AIG squeeze an additional $150m in revenue, according to the reports.
The approach backfired and forced the US government’s bailout of the insurer which now sits at $150bn.