AIG puts up £500m Canary Wharf cover - Business - Evening Standard
       

AIG puts up £500m Canary Wharf cover

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27 March 2009

AIG has been forced to stump up £500 million to cover the chance that certain tenants of Canary Wharf, including Citigroup, will default on rent payments.

The battered insurer guarantees payments on leases for Citigroup and bankrupt bank Lehman Brothers, whose UK operations are now owned by Nomura .

A fall in AIG's credit rating triggered a clause forcing it to put up collateral, even though there is no suggestion either tenant is likely to default.

Canary is owned by Songbird Estates, which yesterday warned it could breach banking covenants after the collapse in London property values.

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