AIG had received over $180 billion from the US Treasury at the height of the global financial crisis in the middle of September, 2008.
"AIG used $6.6 billion of the $9.6 billion it received from the March 2 Metlife sale to make the repayment to the Troubled Asset Relief Programme (TARP)," the US Treasury said in a statement.
In addition, AIG paid the Treasury Department $300 million it had retained for expenses related to its American Life Insurance Company (ALICO) deal. AIG earned $15.5 billion, including about $6.8 billion in cash, from the sale of its subsidiary ALICO to MetLife last year.
"These funds will be used to reduce an equal portion of Treasury's remaining preferred equity interests in AIG, which, after the repayment, stand at $11.3 billion," the Treasury said. With the latest AIG payment, the Treasury has now recovered 70 per cent of the $411 billion disbursed under the TARP, the Treasury added.
Further, $3 billion worth of proceeds from the MetLife stake sale were placed in an escrow account, which may be used to repay the Treasury Department later.
Earlier this week, AIG repaid $2.7 billion to the Treasury. The Treasury is hopeful that "taxpayers will ultimately recover every dollar that the US government invested in AIG."