After just three months as head of battered insurer American International Group (AIG), Robert Benmosche has threatened to leave his post as CEO as he struggles to deal with government oversight and restrictions on what the bailed-out company wants to pay employees, a published report said.
Citing unnamed people familiar with the matter, the Wall Street Journal reported online late on 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.
The sources said 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 last year.
When the credit crisis hit last year, the US government rescued AIG from the brink of collapse with a loan bailout package worth up to US$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’ salaries 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 US$500,000 and perks for most will be capped at US$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 US$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. But Benmosche has warned that earnings will remain choppy as the company executes its restructuring plan.
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