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 With stock in his company up over 400%, American International Group Inc.'s (NYSE:AIG) new CEO Robert Benmosche has been doing things his own way -- halting asset sales, insulting Attorney Generals, taking Croatian vacations ... and is now telling Wall Street banks that he wants a 50% cut in their IPO fees. The post-bailout slimming down of AIG was expected to be a advisory fee cash-cow for Wall Street as the troubled insurer sold off and spun-out businesses left and right to repay a $182 billion loan. However, Benmosche evidently has different ideas about that. According to Bloomberg: "I went into one presentation, and they said, 'Well, the investment banking deal will be in the range of 2% and 2.5%," Benmosche said when asked about fees in an Aug. 11 staff meeting, according to a record obtained by Bloomberg. "I said, 'How about 1%?' So then everybody's face turned red, and I said, 'So change it.' So we're talking about 1%, not 2% to 2.5%." Morgan Stanley (NYSE:MS) is the designated lead underwriter for any IPOs of companies under Federal Reserve control. AIG has previously announced it would hold IPOs for its Hong Kong-based life insurer American International Assurance and American Life Insurance Co., or Alico. It's not only Morgan Stanley that needs to watch out either, as other firms -- including Blackstone Group LP (NYSE:BX), Goldman Sachs Group Inc. (NYSE:GS) and JPMorgan Chase & Co. (NYSE:JPM) -- that are advising AIG on its divestment program are also in his sights. Benmosche is apparently going over lawyers' and consultants' fees in order to get a handle on their fees as well. According to the documents obtained by Bloomberg, Benmosche told employees at the meeting in Houston: I am busy getting lists of bankers, lists of lawyers, how many consultants we have ... We forget to look in our own backyard for skills ... I think we have too many [consultants]. AIG has already bailed out Wall Street, shelling over $75 billion to Goldman, Bank of America Corp./Merrill Lynch & Co. (NYSE:BAC), Morgan Stanley, Société Générale SA, Deutsche Bank AG and Barclays plc last fall, but it looks like the new sheriff in town might be putting an end to that happening again when it comes to fees. - George White
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