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Profile: Robert Willumstad

Robert Willumstad was a participant or observer in the following events:

At the annual shareholder meeting of the insurance giant AIG, Chief Executive Officer Martin Sullivan says he is “not discouraged,” despite the fact that the company has posted successive losses (see October-December 2007 and January-March 2008). Company chairman Robert Willumstad says the directors support the management, adding, “We think Martin’s the right guy.” Shares close at $39.44, a 46 percent drop over the past year. [Bloomberg, 9/16/2008]

Entity Tags: Robert Willumstad, Martin Sullivan, AIG (American International Group, Inc.)

Timeline Tags: Global Economic Crises

June 15, 2008: AIG Boss Replaced

Martin Sullivan, chief executive officer of troubled insurance giant AIG, is fired and replaced by Robert Willumstad, formerly chairman of the company’s board of directors. Board member Stephen Bollenbach is also named lead independent director. The next day, Willumstad says “there will be no sacred cows” as he launches a companywide review of AIG’s operations. [Bloomberg, 9/16/2008] However, he will only remain in the position for three months (see September 18, 2008).

Entity Tags: AIG (American International Group, Inc.), Martin Sullivan, Robert Willumstad, Stephen Bollenbach

Timeline Tags: Global Economic Crises

The stock price of troubled insurer AIG falls 18 percent, closing at $23.84, following the announcement of a third straight quarterly loss the previous day (see April-June 2008). This is the largest fall since the company’s 1969 initial public offering, although this record will be broken next month (see September 9, 2008). In addition, Chief Executive Officer Robert Willumstad refuses to rule out raising more capital to supplement the $112.2 billion AIG held as of June 30. [Bloomberg, 9/16/2008]

Entity Tags: Robert Willumstad, AIG (American International Group, Inc.)

Timeline Tags: Global Economic Crises

AIG logo.AIG logo. [Source: American International Group (AIG)]In an historic move, the federal government bails out insurance corporation AIG with an $85 billion loan, giving control of the firm to the US government. After resisting AIG’s overtures for an emergency loan or other intervention to prevent the insurer from falling into bankruptcy, the government decided AIG, like the now-defunct investment bank, Bear Stearns, was “too big to fail” (see March 15, 2008). The US government will lend up to $85 billion to AIG. In return, the government gets a 79.9 percent equity stake in warrants, called equity participation notes. The two-year loan will carry a LIBOR interest rate plus 8.5 percentage points. LIBOR, the London InterBank Offered Rate, is a common short-term lending benchmark. The bailout comes less than a week after the government allowed a large investment bank, Lehman Brothers Holdings Inc., to fold (see September 14, 2008). As part of the loan agreement, Treasury Secretary Henry Paulson insists that AIG’s chief executive, Robert Willumstad, steps aside. Willumstad will be succeeded by Edward Liddy, the former head of insurer Allstate Corp (see September 18, 2008). [Wall Street Journal, 9/16/2008] Shares in AIG drop to $3.75 on the news. [Bloomberg, 3/5/2009]

Entity Tags: Henry Paulson, AIG (American International Group, Inc.), Edward Liddy, Robert Willumstad, US Federal Reserve

Timeline Tags: Global Economic Crises

September 18, 2008: AIG Boss Replaced Again

Edward Liddy is approved by the board of insurance giant AIG as its chief executive officer. Liddy replaces former boss Robert Willumstad, who had only been in the job for a few months (see June 15, 2008). [Bloomberg, 3/5/2009; Reuters, 4/17/2009] Liddy tells employees he intends to repay a two-year Federal Reserve loan that recently bailed the company out (see September 16, 2008) sooner than scheduled. [Bloomberg, 3/5/2009]

Entity Tags: AIG (American International Group, Inc.), Edward Liddy, Robert Willumstad

Timeline Tags: Global Economic Crises

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