By Leslie Scism
Robert Benmosche, who brought insurance giant American
International Group Inc. back from the brink of bankruptcy and led
it to repay its historic bailout, died Friday morning at age 70
after a five-year battle with lung cancer, the company said.
Known as one of the more colorful and outspoken executives on
Wall Street, Mr. Benmosche came out of retirement in August 2009 to
become AIG's chief executive. At the time, the company was nearing
its first anniversary as recipient of the biggest bailout of the
financial crisis. Mr. Benmosche ran the company for five years,
through Aug. 31, 2014, and helped it regain its competitive
footing.
Under Mr. Benmosche's leadership, AIG fully repaid the
government by late 2012, with the government claiming a profit of
more than $20 billion.
"Bob was one of the most inspirational and successful leaders in
corporate America by any measure," AIG Chairman Robert S. Miller
said in a statement Friday.
Paying back U.S. taxpayers was an accomplishment few expected
when Mr. Benmosche took the high-profile job.
Previously the chief executive of big life insurer MetLife Inc.,
Mr. Benmosche had retired in 2006 to spend much of his time at his
estate outside Dubrovnik, Croatia, where he grew Zinfandel grapes
for his vineyard.
When contacted in 2009 by an executive recruiter for the AIG
job, he recalled later, he wasn't initially interested. But he
found the challenge of saving AIG from possible liquidation
irresistible.
At the time, AIG's future was far from secure, even with the
massive federal aid that had been extended in 2008 during the
depths of the financial crisis. The company had been on the verge
of a bankruptcy filing, in large part due to sales of a risky,
unregulated type of mortgage-bond insurance. The Federal Reserve
and the U.S. Treasury had reluctantly rescued AIG, fearing its
collapse would have caused widespread economic chaos. The aid
reached $184.6 billion at its peak, with U.S. taxpayers at one
point owning 92% of the company's equity.
Mr. Benmosche took a stand against what he saw as unfair
vilification by politicians of the vast majority of AIG employees
who he said had nothing to do with the company's problems. He
hosted dozens of "town halls" at AIG locations in the U.S. and
elsewhere that served as pep rallies for demoralized staffers. He
spoke off the cuff and fielded extensive questions. He cracked
jokes and used profanity.
In those early days, he publicly criticized politicians,
threatened to quit over government pay constraints and spoke
bluntly about what he thought were missteps by the government in
seeking to move too fast to sell assets to repay the aid. He feared
fire-sale prices for crown jewels in the then-sluggish economy.
He slowed down the pace of deal activity, but ultimately roughly
halved the company in terms of employees and assets. The company
remains one of the world's biggest insurers, employing about 64,000
people.
Mr. Benmosche's freewheeling speaking style occasionally got him
in trouble: In 2013, he apologized after an interview with The Wall
Street Journal in which he compared the treatment of AIG employees
after the financial crisis to lynch mobs in the Deep South during
the civil rights era.
"Bob was piercingly honest and driven by a remarkable belief in
the possibility of greatness that exists in every person," said
Peter D. Hancock, AIG's president and CEO, in a statement Friday.
"He poured his energy and focus into enabling AIG's people to live
up to their potential, and that's why this company today is a
sustainable enterprise that understands the importance of meeting
and exceeding the expectations all of our stakeholders.
Mr. Benmosche is survived by his wife, Denise, daughters Nehama
and Beth, son Ari, and six grandchildren.
Mr. Benmosche was born in Brooklyn and grew up in the state's
Catskills region, where his family ran a motel and restaurant. His
father died when he was 10, leaving his mother struggling with
substantial debt. During high school, Mr. Benmosche worked at the
motel and he drove a Coke truck, waited tables and washed dishes to
earn a mathematics degree at Alfred University in western New
York.
He was in the Reserve Officer Training Corps, and from 1966 to
1968 served in the U.S. Signal Corps in Korea. Back in civilian
life, he pursued an interest in computers developed while in
college and took jobs on the technology side of financial-services
firms including at Chase Manhattan Bank, now part of J.P. Morgan
Chase & Co. He moved from there to PaineWebber, which became
part of UBS AG, and his responsibilities broadened to marketing and
brokerage operations.
He joined MetLife in 1995 as a senior executive and was its
chairman and CEO from 1998 to 2006. He helped take the insurer
public in what is still one of the biggest initial public offerings
of all time. MetLife's share price subsequently soared, double the
gain of the average life insurer's stock during his tenure.
Mr. Benmosche was barely a year into the CEO job at AIG when he
was diagnosed with cancer, in October 2010. He never publicly
disclosed specifics of his condition. When one treatment gave him a
skin condition, he grew a beard to cover it. "I just didn't want to
spend a lot of time thinking about cancer," he said in a 2011
interview.
In a town hall with Houston employees in 2013, Mr. Benmosche
spoke in his characteristic from-the-heart manner to recall how, in
arriving for the event, "looking at the AIG on the building, I got
to tell you, it made me feel really--I got little goosebumps, I
must admit. So, it's great to see what we've accomplished and how
proud we can all be of what we've done collectively as an
organization."
Write to Leslie Scism at leslie.scism@wsj.com
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