AIG CEO Peter Hancock Plans to Resign (AIG)

Mar 10, 2017, 00:35
AIG CEO Peter Hancock Plans to Resign (AIG)

American International Group said Thursday that Peter D. Hancock, president and CEO, has informed the board of directors of his intention to resign.

AIG said Hancock will remain with the company until a new CEO is installed.

Shares of AIG ticked up 1.5% in morning trading.

Tensions between Hancock and Icahn began to mount after the CEO rebuffed the activist investor's proposals, which also included extensive cost cutting. AIG's net loss widened to $3.04 billion, or $2.96 per share, in the fourth quarter ended December 31, from $1.84 billion, or $1.50 per share, a year earlier.

Keefe Bruyette & Woods analyst Meyer Shields said the change of leadership was a "significant positive" for the company.

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In February, AIG reported a fourth-quarter loss of $3.04 billion, the New York-based company's worst since the 2008 financial crisis when it was saved from collapse by a $185 billion bailout from the federal government.

"We fully support the actions taken today by the board of AIG", Icahn tweeted on Thursday.

Icahn, who holds a 4.6% stake in AIG valued at $2.9 billion previously urged the company to split itself into three leaner segments: property and casualty, mortgages, and life insurance.

"[Hancock] tackled the company's most complex issues, including the repayment of AIG's obligations to the U.S. Treasury in full and with a profit, and is leaving AIG as a strong, focused and profitable insurance company", said chairman of the board Douglas Steenland.

In late 2015, Mr. Icahn, who is one of the largest shareholders of AIG, called for a breakup of the insurer, saying it was "too big to succeed", a play on AIG's designation as a "too-big-to-fail" systemically important financial institution, or SIFI.