The Irish Independent reports that a huge surge in unemployment and redundancies are outlined in startling new figures published today.
They show 13,300 more joined the dole queues last month -- pushing the total to 436,900. And redundancies soared, according to the latest report, with 6,699 losing their jobs in January. The gloomy figures come despite recent positive soundings from the Government and economists who felt we had turned the corner. The Government also came under further pressure after the opposition said an 18pc year-on-year drop in the tax take for January showed Budget 2010 did nothing to end the vicious cycle of recession.
Fine Gael said Finance Minister Brian Lenihan's claim that the "worst is over" was "dangerously premature".
However, the Government insisted the Exchequer returns for January were "in line with expectations".
But there is no dispute over the extent of the unemployment crisis. Live Register figures to be published at 11am today will show an increase of 13,300 in the numbers signing on the dole last month.
The estimated unemployment rate is now 12.7pc -- up from 12.5pc in December.
Budget forecasts are for an average rate of 13.2pc this year.
The January increase for those on the dole represents a significant rise on the 10,900 recorded in December.
When seasonal factors are taken into account, the increase for January is 8,000, compared with 3,300 in December.
New data from the Department of Enterprise revealed last night that 6,699 people were made redundant in January. The figure does not include those who lost their jobs with less than two years' service and who are not eligible for redundancy payments.
The Irish Small and Medium Enterprises Association (ISME) warned the startling redundancy figures -- which dwarf even the precedent-setting 6,588 official redundancies announced in January 2009 -- are alarming and do not bode well for the coming year.
"The figures are even worse than this time last year. It's showing a continuing deterioration and we're very fearful that the next three months will be even worse," ISME chief executive Mark Fielding said last night.
Almost twice as many men were made redundant as women at 4,289 and 2,410 respectively, while workers in Dublin suffered the most losses at 2,348 jobs.
Redundancies
Co Limerick had the second-highest number of redundancies at 999, followed by Co Cork at 855 while Leitrim, Monaghan and Longford had the fewest at 14, 26 and 42 respectively.
Meanwhile, as the resistance to Budget 2010 measures continues, Taoiseach Brian Cowen insisted the Government had "no desire" to impose further pay cuts on public sector workers. But he did not give any guarantee there would not be further cutbacks in the coming years
And the Taoiseach said there was no way the decision to reduce the pay of public servants in December's Budget would be reversed. But he admitted he did not want to go down the route of pay cuts again and would like unions to re-engage with the Government to find other savings.
The comments come as unions representing workings continue to escalate their campaign against the controversial salary cuts.
Fine Gael enterprise spokesman Leo Varadkar said the latest news on the jobs front represented "a very bleak start to the new year".
He called on the Government to implement two specific proposals from his party -- a national competitiveness plan and a stimulus plan to invest in major new infrastructure and get 100,000 people back to work.
The Irish Independent also reports that the Quinn Group has started discussions with banks about the €780m of bank and bond debt due this year. The refinancing will be one of the largest in Irish business in 2010.
The company said it believed a successful conclusion would be reached on renewing the borrowings, which includes €700m of bank debt and €80m of bonds.
The company's attempt to refinance borrowings of this scale may be complicated by the fact it no longer has a credit rating.
The present terms of the €780m debt facility are not known, but the Quinn Group could be facing a significantly higher funding costs due the absence of a rating.
Barclays Bank has previously raised funding for the company through the US private placement market and the last time a fund raising was done it was over-subscribed, but that was five years ago and credit markets are unrecognisable from then.
However, the private placement market remains one of the few avenues for unrated companies to source funds. Renewing the bonds is likely to prove far more difficult.
Some investment funds are precluded from investing in any unrated debt, with some banks similarly barred. However, pension funds, hedge funds and some investments banks are allowed.
Loan data suggests that some of the debt starts maturing this April, but the Quinn Group said yesterday debts do not mature until October. The loans are secured on specific Quinn companies.
"The Group has €700m of bank debt and €80m of bonds which mature in October this year, and is working with its financiers to refinance these facilities. We are confident this will be brought to a successful conclusion over the coming months. There is no final coupon on this debt as interest has been paid on an ongoing basis,'' said the company.
A banking source said yesterday that the cashflows thrown off by Quinn should help it refinance the facilities, but the lack of a credit rating may force the company to make direct presentations to banks.
"There will be investors there looking for extra yield because of the unrated nature of the transaction,'' said one senior financier.
Quinn Group has been trying to put its disastrous investments in Anglo Irish behind it and recently announced plans to undertake possibly two IPOs before 2015. The company's manufacturing businesses have been performing well with record cash flows, the company said recently.
"Last year and its predecessor were difficult for all of us,'' founder Sean Quinn also said in a newsletter to staff.
The Irish Times reports that Anglo Irish Bank is hoping to avoid taking a multimillion-euro hit on a €1 billion property portfolio by giving a property developer an interest-free loan to take it off its hands.
The transaction, if it goes ahead, will allow Anglo avoid the losses it would incur if it had to sell the properties on the open market.
The proposed deal with Blanchardstown Shopping Centre owners Green Property is similar to one done by AIB last year, which saw the bank avoid crippling losses on a troubled UK property portfolio.
Green is understood to have earned significant fees from the AIB deal, which was structured so as to minimise the risk to the property company.
Anglo Irish and AIB are keen to avoid selling the properties on the market because they are not financially strong enough to absorb the losses they would incur. The properties do not qualify for the Government’s bad bank scheme – the National Asset Management Agency – because they are investment properties rather than development properties.
By selling the London portfolio to Green rather than putting it on the market, AIB recorded a mere €56 million loss on a €700 million portfolio despite a collapse of 20 per cent or more in UK prices.
Anglo Irish now wants to sell nine properties to Green in a similar transaction. All are worth substantially less than Anglo paid for them. Five of the properties are in its €640 million Select Geared Property Fund which was launched in 2007.
The bank aimed to raise €225 million for the fund from clients which would be used to purchase properties up to €640 million with loans from Anglo Irish. The advent of the credit crunch meant that Anglo could not raise the full €225 million and had to put up a portion of the equity itself.
The select fund’s assets include the Gaiety Centre shopping development on Dublin’s South King Street, two office blocks in London, the Metquarter shopping centre in Liverpool, and a redevelopment property in Surrey. Anglo Irish also wants to dispose of four properties owned by its private banking arm. The bank has planned to sell the properties on to its private clients, but has been unable to do so.
The bank’s interest in the nine properties is now held by its pensions and investments subsidiary, Anglo Irish Assurance Company (AIAC).
Anglo now plans to advance Green an interest-free mezzanine (short-term) loan to buy the equity stakes from AIAC. The bank refused to comment on what security, if any, Green had to put up.
The original loans taken out by the select fund and the private bank from Anglo to purchase the properties are expected to remain in place and, if the format of the AIB deal is followed, the writedowns will be minimal.
Green declined to comment on the transaction. But a senior source at the company described the deal as “complex and sophisticated” and stressed it is designed to ensure the bank “recovers” its money.
Industry sources point out that the assets are now worth “close to their debt value” and says a mezzanine loan covering the bank’s equity would be “worthless from day one”.
The deals, which allow the banks avoid debilitating losses, will have negative consequences in the longer term because they circumvent the Government’s efforts to clean up the banking system, according to ESRI chief economist John Fitzgerald.
“We will have failed in that objective if there are continuing doubts” about the true extent of the banks’ bad debts, he said.
The Financial Regulator said it is “engaging with the banks and pushing them to recognise more realistic provisions on their portfolios.”
The Irish Times also reports that a company in the Shelbourne Property Group owned by developer Garrett Kelleher has reported a pretax loss of €149.6 million after it made a provision for debts owed to it by other group companies.
A large part of the debt is linked to the stalled construction of the landmark Chicago Spire in the US, a €1 billion-plus project that was being part-funded by the now nationalised Anglo Irish Bank.
A spokeswoman for Mr Kelleher said he would not be commenting on the latest accounts for Clarinabbey Ltd, which show the company made the loss in the period to the end of March 2009.
The company’s accounts say its bank facilities are “technically in breach” as a result of the company not meeting certain loan to value and interest cover convenants and that it is in ongoing negotiations with its bankers to procure a standstill agreement.
“The group continues to have excellent relationships with its bankers,” the directors state in their report dated January 28th, 2010. However, in the event of standstill/restructuring agreements not being negotiated, “there exists a fundamental uncertainty over the company’s ability to meet its obligations as and when they fall due”.
The accounts state the group’s main bankers are: Anglo Irish Bank; Royal Bank of Scotland and Bank of Scotland (Ireland). They say Clarinabbey had a development property at year’s end worth €9.7 million after its value had been decreased by €1 million following a valuation appraisal.
The notes to the accounts say the company made a provision of €142.18 million arising from uncertainty associated with the recoverability of amounts due by group companies. They also say that total loans from banks were €145 million at year’s end.
The loans are the subject of several guarantees, including a guarantee from a group company and charges over property.
The accounts show the provision arises from money due from group company Shelbourne Finance Ltd. The most recently available accounts for that company are for the year to the end of March 2008. The accounts were signed off on in January last year and explain that the company has provided finance to US partnership, Shelbourne North Water Street LP, which is involved in the Spire project. The directors say the recoverability of the money “is critically dependent” on the project’s success.
The accounts show the company owed €254 million to group companies and was owed €252 million. During the year the company advanced €69.6 million to the US partnership, and was owed a further €27.5 million from Shelbourne Development Group, which is involved in the Chicago development.
The accounts for Shelbourne Finance show a list of companies within the group being advanced significant amounts of money or being owed money by Shelbourne Finance. The Shelbourne group is headed by an unlimited company, the accounts of which are not publicly available.
Work on the Spire, which was to have been the highest building in the US, has been stalled for some time and the architect, Santiago Calatrava, has had a charge registered against the property, claiming he has not been paid his $11.3 million fee. Bank of America has filed a lawsuit in relation to the development.
Although a number of units in the proposed development have been pre-sold, the development as of now comprises a large hole in the ground in the middle of downtown Chicago, about a block away from Lake Michigan.
Mr Kelleher, who put $194 million of his own money into the project, has held discussions with US unions about the possibility of pension fund money being used to finance the building.
The Irish Examiner reports that the euro may face a stiff correction in the period ahead, according to two reports issued yesterday.
Bank of Ireland is forecasting a dip to 84p sterling, down from its high of 98p with the euro currently worth about 87p.
It has also revised its euro/dollar exchange rate down for the period to the end of March 2010.
Three years ago the euro bought under 66p, but by December 2008 the slide in the British currency had pushed the euro up to 98p, said Dan McLaughlin, chief economist, Bank of Ireland, in a new analysis of the euro.
In trading yesterday the euro was trading around 87p while the dollar lost some ground to the euro as fears eased over the Greek financial crisis.
The loss of 30% in sterling’s value over the past two years has been hugely damaging for Irish exports, where the UK is still a key export market.
Over 40% of food and drink exports are to Britain and the sector has suffered badly as a result. Food exports fell by €1bn in 2009, Bord Bia figures show.
Citigroup meanwhile said the euro may face a "correction" that will drive the currency to its lowest level since May. The euro traded at $1.3926 early yesterday and last traded below $1.37 on 20 May 2009.
The strong euro has been good for anyone crossing the border into Northern Ireland, or indirectly via lower import costs, said Dan McLaughlin.
Most studies show that sterling is substantially undervalued against the euro, with 75p seen as around "fair" value.
"We have argued that sterling is likely to appreciate from recent lows against the single currency over time. The decline in the euro/sterling rate of late has seen it trade below 87p and although a short term euro rally is possible, we still feel that the 84 pence lows of last June are likely to be revisited by mid-year."
The euro has also fallen against the dollar, although again the current level (around $1.39) is still substantially above the $1.15 – $1.20 range seen as fair value, he said.
The dollar’s appreciation, which has been broadly based, may in part be due to the relatively good performance of the US economy of late, with GDP in the final quarter of 2009 rising by 1.4%, compared with just 0.2% estimated in the euro area, he said. The perception that continental Europe is under-performing the US is also evident in longer term interest rates, with the yield on 10-year US bonds rising sharply relative to German bonds over the past two months.
"We believe that relative economic performance is a strong driver of currencies so, in the absence of an acceleration in euro growth relative to the US, the euro may remain under downward pressure against a resurgent US dollar. We have cut our forecast for end-March to $1.35 from $1.40," he said.
The Financial Times reports that Greece has won European support for its plan to pull back from the brink of financial disaster after its prime minister unveiled moves to boost tax revenue and cut public spending.
The European Commission said on Tuesday it would endorse Athens’ plan to bring back under control the public sector deficit, which last year reached almost 13 per cent of gross domestic product.
But the European Union’s executive arm warned that Greece had not escaped from its fiscal problems. José Manuel Barroso, Commission president, said Greece’s proposal was “feasible but subject to risks”.
The finance ministry is due to unveil detailed measures on incomes policy and a new tax system aimed at increasing revenues by about 10 per cent a year, next week.
Brussels’ backing provides some relief for Athens and could ease market nervousness about the fragility of public finances in Greece and other eurozone countries – including Portugal, Spain and Ireland – which also have soaring deficits.
Greek budget plight- - FT Video interview: Greek PM George Papandreou admits the crisis is of Greece’s own making.
It came as George Papandreou, Greece’s prime minister, held emergency talks with opposition parties on additional measures, including a fuel tax that is expected to raise €1bn a year – and could be implemented with immediate effect.
In response to criticism that earlier plans had not included sufficient spending cuts, Mr Papandreou also announced an across-the-board freeze in public sector wages which, together with cuts in allowances, would reduce the public sector wage bill by 4 per cent. The government has also pledged to raise the retirement age.
In an emergency TV address on Tuesday night, Mr Papandreou said: “We have to stop the country from falling over a cliff.”
PM PONDERS HIS OPTIONS
Proposals under discussion in the Greek government to tackle the debt crisis:
- Raising the excise tax on fuel. This would start making a significant contribution to revenues within a few weeks
- Improving the efficiency of the tax collection mechanism, which came close to collapse last year
- Cutting the overall public sector wage bill by 10 per cent
- A wage freeze for civil servants and cuts in allowances
- Cuts in operational spending at the defence ministry
Greece’s plight created the biggest challenge to face Europe’s monetary union since its launch in 1999. Frustration with Athens in Brussels and at the European Central Bank was exacerbated by repeated misreporting until late last year of the public sector deficit.
But EU policymakers have deliberately left open what their response would be if Greece came close to defaulting, a policy that intensified pressure on Athens but further unsettled investors, who have also pushed the euro lower.
Under a three-year plan, the Greek government seeks to cut the national budget deficit to less than 3 per cent of GDP by the end of 2012.
But the Commission’s formal response on Wednesday is expected to warn that it will not tolerate any slippage in the target and will, if necessary, demand tougher government action to ensure it stays on course.
Some Brussels officials had expressed fears that early drafts of the Greek plan contained over-optimistic forecasts of economic growth and tax revenues.
The FT also reports that Toyota’s shares sank as much as 5.3 per cent on Wednesday following news that its US sales dropped 16 per cent in January and on concerns over the earnings impact of its massive recall due to mechanical flaws in its vehicles.
The Japanese transport ministry also said on Wednesday that it had received 14 complaints involving the brakes of the company’s latest-generation Prius hybrid car, as more Toyota vehicles come under scrutiny in light of the recalls. Media reports also said US transportation authorities had received about 100 complaints of brake problems with the Prius.
Meanwhile, Ford’s sales rose by 25 per cent, recapturing its traditional number-two slot from Toyota in the US, while GM’s sales increased by 14 per cent. The improved results from the two US carmakers were partly because of sharply higher sales to car-rental operators and other fleet owners.
Toyota has recalled 2.3m vehicles in the US and suspended sales of eight models with potentially sticky accelerator pedals. It has closed five assembly lines this week.
Ray LaHood, US transportation secretary, said on Tuesday that the agency had not finished reviewing Toyota vehicle defects. He said: “While Toyota is taking responsible action now, it unfortunately took enormous effort to get to this point.”
The US is also considering civil penalties against Toyota for its handling of the recalls, Bloomberg News reported.
Members of the US House energy committee on Tuesday sought “clarification” regarding statements made by James Lentz, Toyota’s US president. In a letter, the lawmakers said comments Mr Lentz made on television about the recall and comments Toyota officials made to congressional staff appeared to conflict.
Several of Toyota’s rivals, including GM, Ford and Hyundai, have tried to capitalise on its woes by offering a $1,000 rebate to buyers trading in a Toyota.
Mike DiGiovanni, GM’s sales analyst, estimated that Toyota’s woes had cost the industry about 25,000 units in lost sales last month. Sales of the Camry saloon, the US’s top selling car, slumped by 24 per cent.
According to preliminary estimates, total light-vehicle sales in January, at an annualised 10.7m units, were about 6 per cent higher than in January 2009 but down from 11.3m in December. Blame for the month-on-month decline is partly due to lower discounts. Ken Czubay, Ford’s North American sales chief, said: “We can’t seem to get the traction in the consumer’s mind except when there’s a lot of merchandising and incentives in the marketplace.”
Toyota rolled out a solution to the sticky accelerator problem on Tuesday in the form of a steel bar to be inserted on the pedal assembly
The New York Times reports that emboldened by the response to President Obama’s face-off with House Republicans last week, the White House is intensifying its push to engage Congressional Republicans in policy negotiations as a way to share the burden of governing and put more scrutiny on Republican initiatives.
Top aides say Mr. Obama intends to follow through quickly on his State of the Union proposal for bipartisan White House brainstorming sessions. Republicans will also be invited to the White House this weekend to watch the Super Bowl, as well as to Camp David and other venues for social visits.
The outreach represents a marked shift in both strategy and substance by Mr. Obama and his allies at a time when Democrats are adapting to the loss of their 60-vote supermajority in the Senate and the president has been losing support among independent voters.
The White House’s goal is to show voters that Mr. Obama is willing to engage Republicans rather than govern in a partisan manner while forcing Republicans to make substantive compromises or be portrayed as obstructionist given their renewed power to block almost all legislation in the Senate.
While the strategy addresses some of Mr. Obama’s short-term political problems, it is not clear that it will help him with the more fundamental issue facing him as the leader of the party in power, which is showing voters results before Election Day, especially with unemployment in double digits and the health bill stalled.
For their part, Republicans said they were more than happy to showcase their proposals. They acknowledge that Democrats might have some ulterior motives in inviting more participation, but that it could still have benefits for both parties.
Senator Lamar Alexander, Republican of Tennessee, when asked if Democrats might be trying to create a treacherous political situation for Republicans, responded, “They might be.”
“When we do policy and get good results, there is always the possibility that Democrats might gain a little politically,” he said. “But I think our main job here is to help the country.”
On Tuesday in Nashua, N.H., Mr. Obama showcased the new approach, urging Republicans to come forward with their ideas while chiding them for their resistance to various initiatives in the hopes of achieving short-term political gain.
“I’ve said to the Republicans, show me what you’ve got,” Mr. Obama told his audience while discussing the stalled health care legislation. “You’ve been sitting on the sidelines criticizing what we’re proposing.”
“You got a better idea,” he added later, “bring it on.”
Many Democrats say they believe that Republicans have been able to gain the advantage over the past year by conducting “hit and run” political attacks that allow the opposition to tear down Democratic proposals without much attention being paid to the Republican alternatives. They say that increased engagement could remedy that disparity.
In a new example of their efforts to showcase Republican ideas, House Democrats on Tuesday quickly jumped on one conservative Republican House leader’s suggestion that promised Social Security and Medicare benefits need to be rethought for Americans under 55.
“I think it is very important that people see what the Republican proposals are,” said Representative Chris Van Hollen, Democrat of Maryland. “It is not that they are the party of no, they are the party of no new ideas. They want to turn back the clock and adopt the same Bush policies that got us back in this mess in the first place.”
One example of the White House strategy is likely to play out around Mr. Obama’s support for a bipartisan commission to recommend ways to reduce the deficit, a theme Mr. Obama touched on in New Hampshire.
Administration officials are trying to make the case that Republicans were responsible for driving up the national debt in the Bush years and that they share a responsibility for addressing the situation but are now walking away by opposing the commission that several had initially supported. That move, Democrats say, is evidence that Republicans are unwilling to play a constructive role.
Some Republicans say that they are open to White House overtures but that the party should be wary.
“If the president will consider some free-market economic principles and allow us to leave more money in the private sector rather than demagogue corporations and profits, we might have a chance to work on something,” said Senator Jim DeMint, Republican of South Carolina. “But if it is just more government spending paid for by taxes on the job creators, it is hard to work with that.”
The outreach is going on behind the scenes as well. David Axelrod, a senior adviser to Mr. Obama, initiated a conversation late last year with Alex Castellanos, a leading Republican consultant. Over lunch at the White House mess, aides to both men said, the two had a frank discussion about the first year of the Obama presidency. The dialogue has continued.
Mr. Castellanos said the president and Congressional Republicans could both benefit from stronger efforts at cooperation. But he said the latest discussions seemed to be rooted in political process rather than bridging policy differences.
“There is some naïveté in a president who thinks that if you give everything to everyone then everyone will be happy,” Mr. Castellanos said. “This is arguing about the right way to get to the restaurant instead of what you’re going to eat.”
White House officials said the new approach could help repair Mr. Obama’s standing among independent voters, who catapulted him into the White House but have distanced themselves partly because of the messy legislative debate over health care.
Matthew Dowd, a moderate Republican strategist who was an adviser to President George W. Bush, said that increasing cooperation between the two parties was possible, but difficult given the institutional constraints of the system and Mr. Obama’s role as the leading campaigner for House, Senate and governor’s races.
“It’s going to take the president deciding to be the head of the country, not the head of his party,” Mr. Dowd said. “It takes a serious amount of discipline and courage to do it.”
The NYT also reports that the American International Group has agreed to cut employee bonuses by $20 million and will distribute about $100 million on Wednesday, according to people with knowledge of the negotiations.
But the reductions may not be enough to appease the company’s critics, who do not accept the company’s argument that it has to honor contracts established before its government bailout.
“A.I.G. has taxpayers over a barrel,” said Senator Charles E. Grassley, an Iowa Republican, in a statement on Tuesday night. “The Obama administration has been outmaneuvered. And the closed-door negotiations just add to the skepticism that the taxpayers will ever get the upper hand.”
A.I.G. first promised the retention bonuses to keep people working at its financial products unit, which traded in the derivatives that imploded in September 2008, leading to the biggest government bailout in history.
The contracts, which were established in December 2007, were intended to keep people from leaving the company and called for the bonuses to be paid in regular installments to more than 400 employees in the unit. The final payment, which was for about $198 million, was due in mid-March, but was accelerated to Wednesday as part of the agreement to reduce its size.
Fearing a firestorm like the one last spring, A.I.G. had been working with the Treasury’s special master for compensation, Kenneth R. Feinberg, on a compromise that would allow it to keep its promise in part, without offending taxpayers.
The agreement calls for employees who still work for the financial products unit to accept 10 percent cutbacks, while employees who have left the company must take 20 percent cuts. Those employees are still entitled to their bonuses under the contract, which adheres to the scheduled payments even if people have lost their jobs. The financial products unit has shed almost 200 people as it has wound down A.I.G.’s derivatives business.
A.I.G. has told all the affected people that if they do not accept the reduced amounts, they will get no bonus at all, according to a person with knowledge of the agreement.
But some people have not agreed to the cutbacks and are insisting on the entire amounts. People with knowledge of the negotiations said that a vast majority of those still employed at A.I.G. had accepted the cuts, but only about a third of the former employees had done so.
The holdouts seem determined to make A.I.G. pay the full contractual amounts, knowing they can make a reasonably good case under law, because A.I.G.’s own lawyers have previously issued an opinion that the contracts are binding. If they succeed, A.I.G. would have to pay them more money at some point in the future, and might even have to pay penalties for breaking its employment contracts.
So, while it appeared on Tuesday that A.I.G. and the Treasury had cut the bonus payment to just half of the $198 million that was scheduled for March, the total amount remains unclear. The company acknowledged Tuesday night that it had cut the original amount by $20 million, but did not confirm that the final payment would be $100 million.
In a previous exchange regarding the bonuses, Mr. Feinberg wrote to Senator Grassley on Jan. 15 saying that the contracted amounts were “grandfathered payments.” He said they were not covered by the new rules he administers curbing executive bonuses at bailed-out companies.
“My staff and I have insisted that employees should have their overall current compensation reduced to take into account the fact of these grandfathered payments,” Mr. Feinberg said.
The last time A.I.G. paid a round of retention bonuses, worth $168 million, it caused such an uproar that some employees received death threats, according to its chief at the time, Edward Liddy.
To mollify the public, employees agreed to pay back roughly $45 million to the taxpayer-owned company.
The complaints subsided, but last October, the special inspector general for the Troubled Asset Relief Program, Neil M. Barofsky, audited the program and reported that only $19 million of the total due back had been received.
People involved in the recent negotiations said that in the broad deal that has been negotiated, people will still have to pay back their bonuses, as previously pledged. However, the amounts they forgo in the final payout will be considered a way of making good on their pledges.
The government has extended roughly $182 billion in total to A.I.G., although the assistance has taken many forms and the company has not used that whole amount. It is selling some of its units to help repay the debt.
