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AIG's American General unit said to be seeking $3B term loan

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American General Finance Corp., the Evansville-based consumer lending unit of giant American International Group Inc., is seeking a term loan as large as $3 billion, according to a person familiar with the request.

Bank of America Corp. is arranging the five-year loan that will be sold at a discount of 98 cents to 98.5 cents on the dollar, according to the source who declined to be identified because the discussions are private. If the company repays the loan in the first year, it will have to pay lenders a premium of 101 cents on the dollar, the person said. A loan sold at a discount provides a higher return to investors while reducing borrower proceeds.

Chief Financial Officer Donald R. Breivogel Jr. didn’t immediately return a telephone call seeking comment.

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