NEW YORK (Bloomberg) — American International Group Inc., the world's largest insurer by assets, raised $11.9 billion in a stock sale after posting two record quarterly losses. The company also said a debt offering was "under way".

AIG sold $6.5 billion of common stock at $38 a share, the firm said yesterday in a statement, about one percent below Monday's closing price of $38.37. The insurer also offered $5.4 billion of equity units that can be converted into stock.

Chief executive officer Martin Sullivan has already raised almost all of the $12.5 billion the New York-based company said it would seek. Yesterday's stock offering is about 60 percent more than the $7.5 billion the insurer said it would get from selling equity and related units. AIG said last week its capital cushion became "too low for comfort" after write-downs led to a $7.81 billion first-quarter loss.

"They're taking advantage of the fact that the environment for raising capital has improved in the last week," Mark Rouck, a Fitch Ratings analyst in Chicago, said in an interview. "There's still uncertainty at this point, so maybe they're raising a bit more than they'd planned to build a cushion."

AIG started selling bonds, spokesman Chris Winans said yesterday, declining to say how much was raised. Last week the insurer said it would seek as much as $5 billion by selling fixed-income securities.

AIG's share price has slumped 34 percent this year.

The world's largest financial institutions reported at least $335 billion in asset write-downs and credit losses tied to the US housing slump. Banks and securities firms have raised or announced plans to seek $246 billion since July to replenish capital depleted by the collapse of the US sub-prime market, according to Bloomberg data.

AIG has announced about $20 billion in write-downs on contracts sold to protect debt investors after reassuring shareholders in December that losses tied to the housing market and sub-prime mortgage collapse would be "manageable".

Citigroup Inc. and JPMorgan Chase & Co. are handling the offerings. The underwriters may purchase as many as 25.7 million more shares and 6.4 million more equity units to satisfy demand, AIG said yesterday.