California Bonds Lose Allure as AIG Stake Cut by Most Since 2010
- Yield spread climbs to 16-month high, breaking winning streak
- Following several upgrades, some investors see little upside
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The Golden State is losing its luster to municipal-bond buyers such as American International Group Inc. and Principal Global Investors.
AIG’s California debt holdings were reduced by $764 million, or 17 percent, to $3.86 billion in the three months ended Sept. 30, the steepest quarterly decline since at least 2010, company filings show. As a result, the state makes up just 14 percent of the New York-based insurer’s $27.5 billion municipal portfolio, the smallest share in two years.