American International Group reported a $4.35bn net loss in the first quarter, reflecting continuing markdowns of the value of credit insurance sold by its financial products unit.

The company blamed “restructuring and market disruption charges and accounting charges related to taxes” for its performance. AIG's loss, which amounted to $1.98 a share, follows the $62bn loss it took in the last quarter of 2008, the largest quarterly loss in US corporate history, and a loss of $8.9bn for the year-ago period.

AIG Financial Products, AIG's financial service unit, had an operating loss of $1.1bn. AIGFP recorded a $454m markdown of the value of the remaining $12bn credit insurance it sold on subprime mortgage securities, showing just how damaging the business continues to be. The group continued to wind down the credit insurance it provided to European banks to less than $200bn in nominal exposure and said it did not expect to make payments on those contracts.