U.S. Treasury Declines Comment on Additional Funds for AIG, Citi

The U.S. Treasury Monday declined to comment on reports American International Group was seeking additional government funds and that Citigroup was in talks with the government that could lead to Uncle Sam holding as much as 40 percent of the troubled lender.

“No comment,” Treasury Spokeswoman Stephanie Cutter told reporters at the Treasury Department when asked about both firms.

American International Group Inc. and the U.S. government are engaged in talks that include the possibility of additional funds for the insurer and trading debt for equity, a source familiar with the matter said Monday.

Citigroup is in talks to give the government a larger stake, a person familiar with the matter said. That could provide the government with a far greater say in the affairs of the ailing banking giant.

(Reporting by Corbett B. Daly; Editing by Dan Grebler)