Fallout: The Financial Crisis

AIG turns to ousted chief for help

Marketplace Staff Aug 28, 2009
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Fallout: The Financial Crisis

AIG turns to ousted chief for help

Marketplace Staff Aug 28, 2009
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TEXT OF STORY

Steve Chiotakis: AIG’s stock price has soared in the last month. The troubled insurance company posted its first quarterly profit in two years and now there’s talk about some reconciliation with the former head of AIG. That talk was enough to give the company’s shares an almost 30 percent boost yesterday. The latest, from Marketplace’s Steve Henn.


Steve Henn: Robert Benmosche took over the helm at AIG earlier this month. One of his first moves was to try make peace with Hank Greenberg. Greenberg is AIG’s controversial former CEO and is still the company’s largest individual shareholder.

In 2005 he was pushed out of AIG amid allegations of accounting fraud. Earlier this month he paid the SEC a multi-million dollar fine. And over the last year Greenberg has been a fierce critic of the company and its executives.

But new CEO Benmosche isn’t treating Hank Greenberg like a toxic asset. Benmosche told reporters that despite Greenberg problems he can still quote “help with the solutions.”

Many investors believe the detente could help AIG attract sources new of private capital. The hobbled insurance giant still owes the federal government more than $180 billion.

In Washington I’m Steve Henn for Marketplace.

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