ROBERT BENMOSCHE, the newly appointed chief executive of American International Group (AIG), says he expects the bailed-out insurer to be able to repay its federal debts and to boost value for shareholders, according to a report by Bloomberg News.
Shares rose strongly after the report, rising as much as 31 per cent on the New York Stock Exchange.
“At the end of the day we believe we will be able to pay back the government, and we hope we will be able to do something for our shareholders as well,” Mr Benmosche (65) told Bloomberg while on vacation in Croatia.
“My first charge is to get the company to operate at the level it used to operate, being the world’s best. The fact is we owe the US government a lot of money, and we are not going to be able to pay it back just by our profits, so we will sell some of the company off, but only at the right time at the right price.”
An AIG spokeswoman declined to comment on the report or the increase in the company’s stock price yesterday.
AIG will become “a little smaller. It is too big for any one person to run. It is huge,” Mr Benmosche said, according to a video recording by Bloomberg.
Mr Benmosche, an avid wine connoisseur, is in Croatia to celebrate the first harvest of a crop of Zinfandel grapes. The native New Yorker first journeyed to Croatia because of his interest in wine, according to a 2001 interview by insurance publication A.M. Best. He later bought a lakeside villa in Dubrovnik and began to cultivate the Zinfandel grapes.
Before even officially taking up the AIG job, Mr Benmosche told employees at an August 4th meeting that he planned to rebuild AIG’s profitable insurance operations. “I don’t liquidate things; I build them,” he said at that meeting, according to Bloomberg.
The new chief this week halted the auction of an investment advisory unit.
Mr Benmosche took up the CEO post on August 10th. He had previously been CEO of MetLife Inc, the largest US life insurer.
He came out of retirement to take AIG’s helm. His task at AIG is to repay more than $80 billion in loans from the US Federal Reserve and Treasury while keeping AIG stable. – (Reuters)
