MANILA, Oct 6, 2008 (AFP) - Troubled American Insurance Group (AIG) is to sell its local unit Philippine-American Life and General Insurance Co, the unit's chief executive Jose Cuisia said Monday.

About 10 local and foreign entities have expressed interest in acquiring all or parts of the group, which is involved in insurance, banking and asset management, Cuisia told a news conference.

He declined to give details and said no time-frame had been set by AIG for the sale of the local unit known locally as Philamlife.

Cuisia put the Philippine unit's net worth at 49.4 billion pesos (1.05 billion dollars).

'AIG announced that it will refocus the company on its core property and casualty insurance business to repay its loan from the Federal Reserve Bank of New York,' Cuisia said.

He said he was 'surprised' with the decision, since Philamlife could be considered a 'crown jewel' to AIG.

Philamlife is the Philippines' most profitable and largest insurer, employing about 1,500 people and backed by assets worth 170 billion pesos (3.61 billion dollars).

'AIG is seeking top-rated, financially strong brand names with the capability to continue Philamlife's legacy of leadership, strength, stability and dedication, to its policy holders, employees and shareholders,' Cuisia said.

'This is an opportunity for local companies to own a trophy company,' he said, citing PhilamLife's leading role in the local insurance industry.

He said AIG has hired investment banks JP Morgan and Blackstone to advise it on the sale.

The advisers will help AIG decide whether to sell Philamlife as a whole or part by part, he added.

He said the company remains 'strongly capitalised' and would be able to meet all its commitments to depositors, investors and policy holders.

He said most of Philamlife's investments were tied to government securities and bonds, and that the firm did not have any offshore exposure to troubled American financial institutions.

Cuisia said he was 'not leading a management buyout' of the company.

Philamlife deputy president and chief operating officer Michel Khalaf said the company has for decades remained a 'net contributor' to AIG.

While the company will seek to retain all its employees, he said there could be some 'rationalisation' if a buy-out led to duplication of jobs.