AIG bailout puts feds in PMI business

United Guaranty insures loans for Fannie, Freddie

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The bailout of insurance giant AIG International Group Inc. also makes taxpayers majority owners of a company that insures mortgages guaranteed by Fannie Mae and Freddie Mac, companies placed under government conservatorship on Sept. 7.

The Federal Reserve announced late Tuesday that it would lend up to $85 billion to AIG in exchange for an 80 percent ownership interest in the company.