NU Online News Service, May 21, 4:43 p.m.EDT

|

American International Group Chairman and Chief ExecutiveOfficer Edward M. Liddy will leave the posts he took for $1 peryear just nine months ago as soon as the embattled firm can bringon board a pair of replacements.

|

The announcement was released today just after the stock marketclosed that Mr. Liddy–who has encountered tough criticism fromCongress of late–had told AIG's board of his intention to step downonce the company successfully concludes a search for tworeplacements, one for his CEO post and another to serve aschairman.

|

Mr. Liddy took the posts for $1 a year at the behest of theTreasury Department after an agreement was reached with AIG for thegovernment to provide billions in government bailout monies inexchange for a 79.9 percent interest in the company and a change inmanagement. He replaced Robert Willumstad.

|

"Much work remains to be done at AIG, but much has already beenaccomplished," Mr. Liddy said in as statement.

|

"With the financial assistance of the Federal Reserve Bank ofNew York and the U.S. Department of the Treasury, we have madesubstantial progress in stabilizing AIG, reducing the systemic riskthat led the government to rescue the company, protecting ourpolicyholders and our businesses, and developing a plan to repayAmerican taxpayers, " he said.

|

"I am proud that we are now implementing this repayment plan. Aswe have noted repeatedly, our pace of success will depend on globaleconomic conditions and financial markets. It is likely to takeseveral years. AIG should have a leadership team committed to asimilar time horizon and prepared to carry the plan to completion,"Mr. Liddy concluded.

|

Earlier this week, the company announced the nomination of sixnew independent directors to stand for election at the company'sannual shareholder meeting on June 30, 2009.

|

AIG said Mr. Liddy has determined that, coincident with thereconfiguration of the board, the company should also initiate thenecessary actions to install "a more permanent leadership team andstructure."

|

AIG said Mr. Liddy had board agreement that the roles ofchairman and CEO be separated, and the company intends to conduct asearch to fill each position. The search will include participationby both the reconstituted board and the Trustees of the AIG CreditFacility Trust–the three-member group monitoring the government'sinterest in the company.

|

"In mid-September 2008, Ed Liddy answered the call of hiscountry and the needs of AIG without reservation amid one of thedarkest periods of the current financial crisis," said Stephen A.Bollenbach, AIG's lead director.

|

"Coming out of retirement, he has led AIG effectively andcourageously–and without compensation," he added. "Today, AIG has adurable capital structure, manageable liquidity, and is executingon a credible plan to repay the American taxpayer. We are deeplygrateful for Ed's accomplishments and his leadership, and we wishhim well in his return to retirement. He deserves it."

|

Mr. Liddy took a buffeting in Congress when it was revealed thatthe company had approved bonuses for executives at AIG's FinancialProducts unit, which caused the conglomerate's financialproblems.

|

Mr. Liddy said that legally he had no choice and that he neededto retain talent to wrap up the operation

Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader

  • All PropertyCasualty360.com news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including BenefitsPRO.com and ThinkAdvisor.com.
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.