Robert Willumstad, the Citigroup Inc. heavyweight who left the world's biggest
bank when denied the top job, now
holds the two top slots at American
International Group Inc., the world's largest insurer.
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New York-based AIG announced Sunday that its board had ousted chief executive Martin Sullivan and that he would be replaced by chairman Willumstad. Willumstad had been named chairman of the insurance giant in September 2006, shortly after he left Citigroup.
In recent months, the AIG board was known to be growing impatient with Sullivan, 53, because the company consistently underestimated the effects of AIG's exposure to mortgage-related securities. Last month, AIG reported a first-quarter loss of $7.8 billion after writing down the market value of the AIG Financial Product's derivatives portfolio by $9.11 billion. It was its second record quarterly loss in a row.
Known as a no-nonsense executive, Willumstad was the top operations manager at Citigroup, where he was seen as a possible successor to then-chairman Sandy Weill. His prospects dimmed when the bank appointed Charles Prince chief executive in 2003, then chairman and CEO in 2006. Willumstad left Citigroup in 2005, saying he wanted to be the chief executive of another publicly traded company. Prince was forced out last December.
Willumstad has also been a prolific dealmaker, and during his 18-year Citigroup tenure he negotiated and implemented several deals that expanded the bank's franchise across the U.S. and carved off its insurance businesses. See the full story on TheDeal.com for the details.
AIG will certainly need a steady hand at the tiller as the insurer has lurched from crisis to crisis for the past four years. - Peter Moreira
