AIG chief receives package worth $3.8m

NEW YORK - American International Group chief executive Robert Benmosche received US$2.7 million ($3.8 million) in compensation for 2009 as the bailed-out insurer began selling assets to repay US government loans, an Associated Press analysis of a securities filing shows.

Benmosche, 65, received US$1,153,964 in salary and a restricted stock bonus worth US$1,536,402 that can't be cashed in for three years, the company said yesterday in an annual proxy filing with the Securities and Exchange Commission. He received no cash bonus.

Benmosche took over as AIG chief executive in August. His 2009 pay is a pro-rated amount of his previously announced US$7 million pay package, including a salary of US$3 million plus US$4 million in AIG common stock.

Companies like AIG that hold government bailout funds are subject to limits on executive pay. In AIG's case, the rules cover the insurer's 100 highest-paid employees.

The New York-based insurer last year cut the salaries of three top executives, including chief financial officer David Herzog, to comply with the rules. But it got approval for Benmosche's pay package from federal pay czar Kenneth Feinberg.

AIG was bailed out in September 2008 by the US Government as the financial crisis spiraled out of control.

The insurer has received aid packages with a total value of US$182.5 billion. In return, the US Government received an 80 per cent stake in AIG.

The company was undermined by its underwriting of risky credit derivatives contracts. A plunge in the value of those contracts was the primary driver of AIG's near-collapse.

The lack of a 2009 cash bonus and the three-year vesting period for Benmosche are similar to moves made by other financial firms.

The 30 top executives at Goldman Sachs, for example, got no cash bonuses last year. Instead they received stock that cannot be sold for at least five years.

Benmosche's pay package also included US$14,164 in perks, mainly for personal use of the company car.

AIG has been working for the past year and half to sell assets and streamline operations in an effort to repay government debt.

Last month, it sold its American Life Insurance division, or Alico, to MetLife for US$15.5 billion.

Earlier in March, it said it would sell its AIA Group unit to Prudential for US$35.5 billion.

- AP