Monday, a report by a bailout overseer was released, which says that though the enormous bailout has led to stabilization in AIG; however, the risk still lingers on over $120 billion in taxpayer loans to the insurance company.

It was forwarded by the Government Accountability Office (GAO), which looks after Treasury's $700 billion Troubled Asset Relief Program, that the company has been immensely aided by the government; but, in order to sustain that stability, AIG has to depend vastly on federal assistance.

As per GAO, AIG's primary source of credit remains the Federal Reserve loans and Treasury Department investments, and without the assistance from taxpayers, the company's steady credit rating, recent profitable quarter and adequate capital levels would not have been possible.

The report specifies, "Continued government support will be necessary until AIG can restructure its operations. But that government assistance carries significant exposure to credit and investment risks, given taxpayers' enormous loans and 79.9% interest in AIG."

Though signs of strength have been displayed by AIG in a few of its operations, including the company's core insurance business, but GAO informed that it is very early to decide if the insurer's stability is a trend or simply an anomaly. AIG can't pay its loans back, until it can reveal stability in the long term.

AIG is mulling to pay back the government by selling off pieces of the company.

"Those asset sales have been slow-going and sold at depressed values thus far, as credit remains tight. AIG has made only $8.6 billion on those deals to date, and has paid back just $1.4 billion on the roughly $38 billion Fed loan. AIG has paid back $6.8 billion of a separate $35 billion New York Fed loan and has not paid any of its TARP loan back," said a source who wanted to stay anonymous.