Posted January 27, 2013 by Alexander Cooke in Featured

Bonus for AIG employees- GS, JPM, C

Northern, WI 1/26/2013 (avauncer) - After being free of US bailout, American International Group (NYSE:AIG) executives will be receiving more monetary motivation according to Chairman Steve Miller.

Even though the staff has worked diligently and sincerely, Miller is of the opinion that the proverbial ‘dangling a carrot in front of the horse’ idea would work wonders. He opines that employees would perform better if an incentive program was in place.

During the 2008 bailout of $182.3 billion, US Treasury Dept. slapped restrictions on the remuneration received by top management staff. Due to this, the company suffered high attrition rates and found it difficult to retain its finest people.

But now, American International Group (NYSE:AIG) is free from its debt and can function more comfortably without any shackles binding it. Planning of an incentive program is underway and results can be expected within a couple of months.

Daniel Loeb of Third Point LLC hedge fund, which increased its holdings in the company, said that monetary motivational models fared, better than regular payment models and this will uplift the stock price.

But the US Treasury did not agree that these pay restrictions were detrimental to the company’s competitive competencies. The Treasury had pulled up American International Group (NYSE:AIG) for paying out an estimated $400 million as bonus to its employees including the ones involved in derivative bets which almost drowned the company.

The trend of declining bonuses can be seen all over as lending banks such as JPMorgan Chase & Co. (NYSE:JPM) and Citigroup Inc. (NYSE:C) cut down on incentives due to pressure from shareholders for more returns. Even The Deutsche Bank decided to cut down bonus by 20% to its investment bankers.

Miller who became Chairman was also selected as CEO of Hawker Beechcraft Inc. in which Goldman Sachs Group Inc. (NYSE:GS) have a stake.

But Miller is of the opinion that the roles of chairman and CEO should be separate as they are very dissimilar posts. He also added that it was more imperative that there is a leader on the board to lead the other independent members.

The shares of American International Group (NYSE:AIG) were up 0.27% to $36.70. The shares of Goldman Sachs Group Inc. (NYSE:GS) were down by 0.34% to $144.46. The shares of JPMorgan Chase & Co. (NYSE:JPM) were up 1.70% to $47.16. The shares of Citigroup Inc. (NYSE:C) were up 0.26% to $42.91.

Alexander Cooke

Alexander Cooke has over 8 years experience in Automobile, marketing, PR, advertising, sales, promotions and special events planning. His writing for print includes work for a Gannett paper and a personal experience piece for Newsweek. Since 2008 he has concentrated on automotive articles for the on-line market and produced numerous pieces for the High Gear Media site Allcaradvice.com. That work was moved to the media company’s flagship site Thecarconnection.com where it can be viewed.