AIG 'to cut $21m from retention bonus payouts'

15 March 2010

American International Group (AIG) is to cut $21 million from the amount it will pay in retention bonuses to its former staff members, a company insider has said.

The source told Bloomberg that a reduction of around 33 per cent from the originally-planned level will be made - meaning that the 70 employees in line for the money will now share out about $46 million.

AIG is aiming to meet the target set by Kenneth Feinberg, the government's pay czar, who wants to see a total of $45 million returned by staff - the amount pledged by members of the company's financial products unit in March 2009.

Only $19 million has been handed back so far, leading Mr Feinberg to demand that the rest is delivered by the end of 2010.

Last month, the majority of staff still working in the AIG division agreed to have their bonuses reduced by as much as 20 per cent in return for receiving them early.

By Asim Shah

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