NU Online News Service, April 14, 12:15 p.m. EST
American International Group this week in SEC filings said federal salary restrictions prevent it from being competitive in a defense of the millions it pays management.
The company in 2010 is paying a cash, stock and incentive package to its chief executive, Robert H. Benmosche, of $10.5 million.
Packages for other top officers are:
o Chief Financial Officer David L. Herzog–$4,287,500.
o Chartis unit CEO Kris P. Moor, $7, 141,667
o Life Insurance Chief Operating Officer Rodney O. Martin–$7,260,000.
o Executive Vice President Nicholas C. Walsh–$6,670,000.
Mr. Benmosche's package, according to the company, is "significantly less than actual historic compensation of Chief Executive Officers at AIG and other large employers," as well as what he was paid at his previous employer MetLife.
The firm said it had numerous discussions and disagreements with Kenneth Feinberg, the special master charged with setting executive pay levels for companies like AIG that have taken Troubled Asset Relief Program aid.
AIG said it had objected to limits set by Mr. Feinberg on Mr. Herzog and Mr. Moor's pay, and "is concerned that the limited current pay under the Special Master's structure prevents AIG from offering competitive compensation opportunities for these employees."
In 2009, when Mr. Feinberg cut the cash portion of Mr. Herzog and Mr. Moor's compensation from $675,000 and $1 million to $350,000 and $450,000, respectively effective Nov. 1 2009, AIG said it "strongly objected to these reductions.
AIG said restrictions on cashing in stock awards and other deferred payment arrangements meant its executive compensation was in line with TARP's requirement that it not encourage risky corporate behavior based on short-term results rather than long term value.
Former CEO Edward Liddy, who resigned last May, had his annual stipend raised from $80,000 to $120,000 because the company said it had been an "inconvenience" for him to commute from his home in Chicago to New York where the cost of living was higher.
AIG's statements were contained in Form 8K and proxy filings with the Securities and Exchange Commission.
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