Another day, another loser in the global game of subprime hide and seek. As the Group of Seven finance leaders said over the weekend, there could be $400bn of losses in the financial system linked to US subprime mortgages.

Yet only $120bn have been revealed so far. American International Group’s confession on Monday reveals where some more of the losses were hiding.In December, the US insurer announced a $1.05bn to $1.15bn charge for October and November for credit default swap (CDS) insurance it wrote against collateralised debt obligations backed by subprime mortgages.