American International Group Inc (AIG) said on Tuesday it was limiting how much it pays its top executives, including granting a US$1 salary for this year and the same for next year to chief executive Edward Liddy.
The decision is one of many broader moves made by the troubled New York-based insurer, which has been under pressure to restrict executive pay since accepting billions in government assistance to save it from collapse. AIG has received about US$150 billion so far, more than any other company.
It was once the world’s largest insurer with customers around the globe and regulators feared the possible effect an AIG collapse would have had on the world’s financial system.
The company said there would be no annual bonuses and no salary increases through next year for AIG’s top seven officers and no salary increases through next year for the 50 next-highest AIG executives.
“We believe these actions demonstrate that we are focused on overcoming our financial challenges so AIG can return value to taxpayers and shareholders,” Liddy said in a statement.
AIG shares fell US$0.09, or 5 percent, to US$1.68 in midday trading.
The announcement comes after New York Attorney General Andrew Cuomo sent a letter to Liddy earlier this month saying AIG should be “completely transparent” about its compensation plans for this year.
In the middle of September, the US Federal Reserve said it would offer two loans totaling US$123 billion to AIG to help the insurer stave off bankruptcy. AIG was later allowed to access another US$20.9 billion through the Fed’s “commercial paper” program. And earlier this month, the government announced new financial assistance to the company.
In a letter to Cuomo on Tuesday, Liddy said AIG was “extremely grateful” for the support it had received from US taxpayers and said the company did “recognize the obligation we have to use that support to help AIG recover, contribute to the economy and repay taxpayers.”
AIG also said no taxpayer dollars would be used for any annual bonuses or future cash performance awards for AIG’s top management positions.
Liddy, who joined the company in the middle of September, will not receive an annual bonus this year or next, although he may be eligible for a special bonus for “extraordinary performance” payable in 2010, the company said.
Earlier this month, AIG ended 14 voluntary deferred compensation programs, resulting in US$500 million of payouts due in the first quarter of next year.
The company said it made the move to prevent employees from having to leave to collect deferred pay. The old plans had been set up so that employees could defer pay voluntarily and collect it when they left AIG, no matter the reason.
Several struggling financial institutions have announced in recent weeks that they are canceling bonuses for top executives, including Goldman Sachs, the Swiss bank UBS and the British bank Barclays.
INSURRECTION: The NSB said it found evidence the CCP was seeking snipers in Taiwan to target members of the military and foreign organizations in the event of an invasion The number of Chinese spies prosecuted in Taiwan has grown threefold over a four-year period, the National Security Bureau (NSB) said in a report released yesterday. In 2021 and 2022, 16 and 10 spies were prosecuted respectively, but that number grew to 64 last year, it said, adding that the Chinese Communist Party (CCP) was working with gangs in Taiwan to develop a network of armed spies. Spies in Taiwan have on behalf of the CCP used a variety of channels and methods to infiltrate all sectors of the country, and recruited Taiwanese to cooperate in developing organizations and obtaining sensitive information
Seven hundred and sixty-four foreigners were arrested last year for acting as money mules for criminals, with many entering Taiwan on a tourist visa for all-expenses-paid trips, the Criminal Investigation Bureau (CIB) said on Saturday. Although from Jan. 1 to Dec. 26 last year, 26,478 people were arrested for working as money mules, the bureau said it was particularly concerned about those entering the country as tourists or migrant workers who help criminals and scammers pick up or transfer illegally obtained money. In a report, officials divided the money mules into two groups, the first of which are foreigners, mainly from Malaysia
SILICON VALLEY HUB: The office would showcase Taiwan’s strengths in semiconductors and artificial intelligence, and help Taiwanese start-ups connect with global opportunities Taiwan has established an office in Palo Alto, one of the principal cities of Silicon Valley in California, aimed at helping Taiwanese technology start-ups gain global visibility, the National Development Council said yesterday. The “Startup Island Taiwan Silicon Valley hub” at No. 299 California Avenue is focused on “supporting start-ups and innovators by providing professional consulting, co-working spaces, and community platforms,” the council said in a post on its Web site. The office is the second overseas start-up hub established by the council, after a similar site was set up in Tokyo in September last year. Representatives from Taiwanese start-ups, local businesses and
‘DETERRENT’: US national security adviser-designate Mike Waltz said that he wants to speed up deliveries of weapons purchased by Taiwan to deter threats from China US president-elect Donald Trump’s nominee for US secretary of defense, Pete Hegseth, affirmed his commitment to peace in the Taiwan Strait during his confirmation hearing in Washington on Tuesday. Hegseth called China “the most comprehensive and serious challenge to US national security” and said that he would aim to limit Beijing’s expansion in the Indo-Pacific region, Voice of America reported. He would also adhere to long-standing policies to prevent miscalculations, Hegseth added. The US Senate Armed Services Committee hearing was the first for a nominee of Trump’s incoming Cabinet, and questions mostly focused on whether he was fit for the
RSS