April 7, 2010 > Treasury appoints two retired execs to AIG board
Treasury appoints two retired execs to AIG board
By Daniel Wagner, AP Business Writer
WASHINGTON (AP), Apr 01 - The Treasury Department has appointed a former banking executive and a former high-tech CEO to the board of directors of insurance giant American International Group Inc.
Donald Layton and Ronald Rittenmeyer will serve as directors as AIG strives to repay a government bailout package that totaled $182 billion, Treasury announced Thursday.
Layton is a former JPMorgan Chase & Co. vice chairman who worked at the bank for 29 years. He served in 2008 and 2009 as chairman and CEO of ETrade Financial Corp.
Rittenmeyer is former chairman, president and CEO of the technology systems firm Electronic Data Systems Inc. He presided over that company's sale to Hewlett-Packard in 2008.
The government owns nearly 80 percent of AIG after the bailouts. Yet officials mostly keep their distance from the company, which became a symbol of risky business practices and excessive pay on Wall Street.
Treasury has the right to appoint two AIG directors because AIG missed four of the quarterly dividend payments Treasury collects from most bailed-out companies.
AIG is one of a handful of companies whose bailouts are expected to cost taxpayers more than $100 billion.
Officials feared AIG's failure could topple banks that bought its insurance-like protection against investment losses. If other banks knew AIG was unable to meet its obligations, that would cause panic and the credit crisis would spread, officials warned.
Layton already is a director at one company that sells those products, called credit-default swaps. He has been a director of Assured Guaranty Corp. since 2006, and chairs that board's risk oversight committee.
Treasury retained the executive search firm KornFerry to help it identify potential directors.