The frustration Robert Benmosche may have felt at the level of government oversight of his company has been mitigated a bit, thanks to a $7 million executive compensation package, approved Tuesday by the board of American International Group Inc. (AIG).
The agreement comes after Benmosche, AIG's CEO and former chief executive of large U.S. life insurer MetLife Inc., apparently hinted that he was tempted to quit because of frustration over the extent of governmental oversight at the company, including how much it can pay top executives, according to a Reuters report.
The approval, which the company announced Tuesday, means that AIG can pay Benmosche an already agreed annual salary of $3 million in cash, and $4 million in fully vested AIG stock.
As part of the deal, he is restricted from selling the vested AIG stock for five years from his August start date. Benmosche also reportedly signed a “non-compete” agreement that would bar him from working for AIG's competitors when he eventually leaves the company, said a source familiar with developments.
As rumors in the greater press surfaced about statements made during an AIG board meeting last month, Benmosche reportedly told employees in a letter that he was "totally committed'' to seeing the company through its difficulties. He has also now given the board an assurance that he will stay, said the source, who asked not to be identified because he was not authorized to speak about these developments, Reuters reported.
Benmosche could also be eligible for a performance bonus that would raise his total compensation as high as $10.5 million.
As one of the largest recipients of U.S. aid, AIG has to comply with pay regulations imposed on the top 100 executives at companies that have received the largest loans under the U.S. Treasury's Troubled Asset Relief Program. Benmosche's pay package had already been approved by Washington pay czar Kenneth Feinberg.
Once the world's largest insurer, AIG was rescued last September by a taxpayer bailout that has grown to as much as $180 billion, including more than $80 billion in loans. Today, approximately of the company’s assets are 80%-owned by U.S. taxpayers.
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