UPDATE: Bank of America Merrill Lynch Initiates AIG at Buy

Bank of America Merrill Lynch is out with its report today on AIG (NYSE: AIG), maintaining Buy.

In a note to clients, Bank of America Merrill Lynch writes, "We are initiating coverage of AIG with a Buy rating. We believe that with the shares trading at under 60% of our estimated year-ahead book value, the current price more than reflects concerns over the earnings power of the company and the balance sheet risk, especially noting AIG's unrecognized sizeable deferred tax asset. Our 12-month price objective is $37 which we arrive at by both looking at the shares on a sum-of-the-parts and a dividend discount basis."

At the time of posting, shares of AIG were trading pre-market at $28.34, up 0.85% from Thursday's close.