Robert Benmosche, the former president and chief executive of AIG who led the insurer's turnaround after its $182-billion government bailout, died of lung cancer Friday at NYU Langone Medical Center, the company said. He was 70.
Benmosche became AIG's chief executive in August 2009, recruited for the job by the Obama administration. He had previously led insurer MetLife.
American Insurance Group Inc. was bailed out at the height of the 2008 financial crisis after its near collapse when the subprime mortgage bubble burst.
Regulators were concerned that AIG's demise would send shock waves through the financial system, which was already staggering after the failure of financial services firm Lehman Brothers.
The company repaid its bailout funds by 2012, and the government made a profit of $22.7 billion. AIG also restructured and shed some businesses, cutting its size in half.
Benmosche was born May 29, 1944, in Brooklyn, N.Y. According to a statement released by his family, his parents, Lillian and Daniel, later moved upstate, running a restaurant and renting out cabins. When his father died in 1954, his mother was saddled with $250,000 in debt. Benmosche later worked in his family's motel business, drove delivery trucks for Coca-Cola, and served in the U.S. Army in South Korea.
Benmosche later became chief executive of MetLife and led the company when it went public in 2000. He retired in 2006 and established a vineyard near his villa in Dubrovnik, Croatia, before being asked to take the helm at AIG.
AIG became a symbol of excessive risk-taking on Wall Street and a focal point for public anger. The company spent $440,000 on spa treatment for its executives days after it was bailed out, and it paid millions of dollars in bonuses to executives.
In early 2013, as AIG was running an ad campaign thanking the public for its rescue, former Chief Executive Maurice "Hank" Greenberg sued the government, saying the terms of the bailout were too onerous. AIG was legally obliged to consider joining the action but decided not to.
Later the same year, Benmosche defended the bonuses and told the Wall Street Journal that public and governmental anger over AIG's bonuses was wrong and similar to a lynching.
Jay writes for the Associated Press.