(Bloomberg) ? American International Group Inc., the world?s largest insurer, sold $1.75 billion of notes in its biggest US bond issuance in at least ten years, according to data compiled by Bloomberg.

AIG sold $400 million of five-year floating-rate debt that pays interest of 11 basis points more than the three-month London interbank offered rate. Libor, a lending benchmark set daily by banks, is 5.37 percent.

The New York-based insurer also issued $600 million of 5.375 percent debt due in 2011 and $750 million of 5.6 percent notes maturing in 2016. The securities yield 61 basis points and 81 basis points more than similar-maturity Treasuries, respectively. A basis point is 0.01 percentage point. Moody?s Investors Service rates AIG?s bonds Aa2, and Standard & Poor?s ranks the debt AA, the third-highest investment-grade ratings. Lehman Brothers Holdings Inc., Morgan Stanley and Wachovia Corp. managed the sale.

The average AA rated bond matures in 7.26 years and yields 5.49 percent, or 66 basis points more than Treasuries, according to index data compiled by Merrill Lynch & Co.