NEW YORK (Bloomberg) - American International Group Inc. may jump almost 50 percent from a five-year low in New York trading because the world's largest insurer will probably recoup the $4.88 billion in losses it booked from credit-default swaps, Barron's reported, citing analysts.

Outside accountants forced AIG last week to reduce the value of the credit derivatives that protect fixed-income investors from defaults, while AIG, based in New York, countered that "over time" those losses may be recovered.

The auditors may have been "too draconian" in their judgment that AIG should take the writedown, Barron's said in its February 18 edition.

AIG, after subjecting its portfolio of related collateralised debt obligations to a "doomsday scenario," found that pretax losses would amount to $590 million, the newspaper said.

That compares with the company's book value, or shareholders' equity, of $104 billion at end of the third quarter, according to Barron's.

"Its global franchise hasn't been tarnished and the company retains a diversity and scale difficult to replicate," UBS AG analyst Andrew Kligerman told Barron's.

He has a "neutral" rating on AIG shares, according to Bloomberg data.