AIG Board Nears Approval of Revised Fed Plan: Source

The board of troubled insurer American International Group was nearing approval late on Sunday of a revised U.S. bailout to replace a previous $85 billion rescue, a person familiar with the matter said.
Under the revised rescue plan, the U.S. government is expected to buy $40 billion of AIG preferred shares through Treasury's Troubled Asset Relief Program (TARP) and greatly ease lending terms, sources said.
The government is also expected to set up two separate vehicles that will buy securities worth billions of dollars underlying the insurer's credit default swaps and backstop a securities lending portfolio, the sources said.
AIG plans to announce the new plan early on Monday, when it reports third-quarter results, sources said.

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