Report: AIG CEO ready to quit over pay constraints
Report: AIG's Benmosche ready to pack it in after just 3 months due to gov't oversight

On 12:07 am EST, Wednesday November 11, 2009

NEW YORK (AP) -- After just three months as head of battered insurer American International Group, Robert Benmosche has threatened to leave his post as he struggles to deal with heavy government oversight and restrictions on what the bailed-out company wants to pay employees, according to a published report.

Citing unnamed people familiar with the matter, The Wall Street Journal reported online late Tuesday that Benmosche told AIG's board he was "done" with the job, although he reportedly is reconsidering his stance in the face of the board's dismay.

According to the people, the former MetLife CEO is frustrated with the constraints of leading a company majority-owned by the government, the paper said. The Journal said Benmosche has complained to AIG's board about the outcome of the Treasury Department's pay review which slashed pay for a number of AIG executives by 91 percent from 2008.

When the credit crisis hit last year, the U.S. government rescued AIG from the brink of collapse with a loan bailout package worth up to $182.5 billion in exchange for an 80 percent stake in the insurer. It is one of seven big companies the Treasury Department ordered to cut top executives' salary and bonuses in half, starting this month. Under the plan, cash salaries for the top 25 highest-paid executives will be limited in most cases to $500,000 and, in most cases, perks will be capped at $25,000.

For the already struggling companies, the plan has introduced concerns about so-called brain drain, as the executives targeted by "pay czar" Kenneth Feinberg rank among the most talented and productive at their companies.

Benmosche took over from Edward Liddy in August, making him AIG's third CEO in less than a year. Under a package approved by Feinberg over the summer, the AIG CEO will get compensation of about $10.5 million.

The New York-based company last week said it was profitable for the second straight quarter as its core insurance operations continue to stabilize, and reported that the amount of its government financial assistance dropped by 4 percent during the period.

Its results got a lift from the increasing value of investments it still holds that soured last year and helped drive it to the brink of collapse. But Benmosche has warned that earnings will remain choppy as the company executes its restructuring plan. AIG is spinning off two major life insurance businesses -- American International Assurance Co., or AIA, and American Life Insurance Co., also known as ALICO -- as it looks to repay the government.

folks should also be pissed at the billions being pumped into Fannie and Freddie. These GSE's should be dismantled and the jobs/funding to should go to 100 new private sector players. How come I never head about 1000's of these morons getting fired?

All this bonus money should go out to common share dividends.

Bailout of AIG and salary for the new AIG CEO are two different things. I won't argue whether I think bailouts are good or bad, because they have already happened and are a sunk cost.

I will argue that because of the bailout, the government better make darn sure that AIG turns itself around and they should "hire the best" to do it. A $10 million investment to protect your billions of investment in AIG makes sense.

If you look at his record, I think it speaks for itself because MetLife is one of the few that came out looking relatively great even through all of this mess of the last two years.

These same morons who protested bailouts probably voted for Corzine

Quote:

And they thank you for not dismantling the Federal Reserve and voting in politicians that give them corporate handouts.

I like to go up to those I see with a hat saying Goldman Sachs or AIG etc etc and say your'e welcome! Then they say excuse me? Then I repeat your'e welcome! And then they say for what? And I say for my taxpaying hard earned money!

We should also be picketing the government that gave it to them. This is why it's dangerous to let the Fed centrally plan the economy. They reward their buddies at the expense of the rest of us.

Protesters picketing AIG slam bailed-out firm's big bonuses

Saturday, November 07, 2009
By MICHAELANGELO CONTE
JOURNAL STAFF WRITER

About 20 members of the New Jersey Citizen Action group picketed outside the Jersey City offices of AIG yesterday afternoon, protesting bonuses that have already been paid and those promised to workers at the company that was central to the financial industry meltdown.

"We urge AIG to stop paying bonuses and to make employees who have already received bonuses give them back," said Phyllis Salowe-Kaye, executive director of NJCA.

The protesters carried posters and sang song parodies attacking the insurance giant, which received more than $182 billion from taxpayers to avert its collapse.

"You got bailed out! We got sold out!" they shouted outside the 101 Hudson St. offices that opened in 2004 and are staffed by 1,300 employees.

According to NJCA officials, AIG has promised $475 million in bonuses to employees of the Financial Products Unit even though the unit was the root of the company's losses. Total bonuses, they said, are estimated at $1.2 billion.

AIG spokesman Mark Herr responded that those at fault in AIG's Financial Products Unit are gone. He said current FP workers are winding down the unit and when done, they will lose their jobs.

He added that in March AIG workers agreed to return up to half of their retention bonuses and have already returned $19 billion.

To the protesters' complaint that at $10.5 million, CEO Robert Benmosche's pay is higher than any chief running, Herr noted that Benmosche's salary was cleared by the government's special master for compensation.

"The men and women of AIG continue to work diligently at rebuilding the companies, restoring shareholder value - which benefits the American taxpayers, our largest shareholders - and repaying the government," Herr said.

Protester Paulette Everle of Jersey City, who stood in the cold wind with her seeing-eye dog Prudy, noted that many people are out of work.

"Unemployment is at 10.2 percent and they are still working and getting bonuses with our tax dollars," she said.