The American International Group, Inc. (NYSE:AIG) announced Monday that it has started selling its remaining 13.7 percent stake in the Asian life insurer AIA Group Ltd. (HKG:1299), raising about $6.7 billion, or 52.2 billion Hong Kong dollars. The Hong Kong trading of AIA Group Ltd. (HKG:1299) shares was suspended Monday, pending an announcement on the final agreements of the sales process.

Sign on office building for American International Group in Los Angeles

American International Group, Inc. (NYSE:AIG) said most of the shares will be sold to institutional investors. The New York-based insurance giant will use the proceeds to repay its debts to the U.S. government. The company is aggressively shedding non core assets for the same reason. Last week, American International Group, Inc. (NYSE:AIG) announced to sell about 90 percent stake in an aircraft-leasing unit.

Treasury Department bailed out American International Group, Inc. (NYSE:AIG) during the 2008 economic crisis by pouring in over $182 billion, the biggest bailout in American history. The U.S. Treasury recently sold its remaining stake in the company for $7.6 billion, making a total profit of $22.7 billion from the bailout.

The American International Group, Inc. (NYSE:AIG) had been gradually selling its stake in AIA Group Ltd. (HKG:1299) since October 2010, when it sold two-third of AIA Group Ltd. (HKG:1299) in Hong Kong IPO and raised $20.51 billion to pay off debts to the U.S. government. Again the company sold a portion of its shares in March and September this year, thus raising a total of $8 billion. That transaction put a three month lockup that expired on December 10. During the lockup period, American International Group, Inc. (NYSE:AIG) couldn’t sell shares of the Asian insurer.

AIA Group Ltd. (HKG:1299) employs over 21,000 people and has more than 260,000 agents across the Asia-Pacific region. It was started in 1919 by an American entrepreneur in Shanghai. American International Group, Inc. (NYSE:AIG)’s stake sale ends about 90 years of association with AIA Group Ltd. (HKG:1299).

However, selling its stake in AIA Group Ltd. (HKG:1299) doesn’t mean the American insurer is exiting the Asian market altogether. Last month it announced to form a Chinese joint venture with People’s Insurance Company (Group). Based on their agreements, American International Group, Inc. (NYSE:AIG) invested $500 million PICC during the Hong Kong listing of the Chinese insurance company. The joint venture will be selling life insurance and other insurance products throughout China.