AIG Execs Suffering, Benmosche Says

NEW YORK (TheStreet) -- AIG's top employees are suffering more financial losses than the public can imagine, according to its chief, the Wall Street Journal reports.

Robert Benmosche, AIG's CEO, says that 10 people that report directly to him have lost a combined $168 million in prior years' pay since the government bailout in September 2008. At the same time, five employees in AIG's financial-products division have lost $88 million in prior years' pay as it winds down its derivative trade.

Benmosche says their money went out the door when their cash bonuses were slashed and their unvested stock salary and stock options became nearly worthless after AIG's near collapse.

"Many people think there was no penalty for the executives at AIG when it did poorly, and that they need longer-term compensation so they don't benefit from taking inordinate amounts of risk," Mr. Benmosche said in an interview with the paper.

"But if you look at where they've been this year, they've been pretty much wiped out. And we have to recognize that we're not 100% sure about what the value of AIG will be in the future."

Benmosche tells the paper that he still believes keeping AIG's executive compensation at competitive levels and asset sales alive -- despite its recent slow-down at AIG -- are among the key factors that will help AIG repay the $90 billion it owes taxpayers. Benmosche expects that could take years.