AIG CEO: It May Take 18 Months to Shed US Stake
American International Group, now 92 percent-owned by the US government, probably won't be completely independent for another 18 months, CEO Robert Benmosche told CNBC Friday.
"I think they get a large amount of stock sold this year at a good price," Benmosche said in a live interview. "They want to make sure they're getting a good return or profit. But my guess is they won't be able to do it all at once."
The recapitalization of the bailed-out insurer closed Friday, setting off an immediate round of speculation as to how fast it would take the government to exit its position.
Expectations are that the deal's managers could be picked within a week, while others said the fee on the deal already was under pressure.
Benmosche said he hopes to be present to see the project through to fruition, despite the aggressive chemotherapy treatments he has received for cancer.
"If my health is fine and my doctors say that I'll be able to stay as healthy as I am now for the next 12 to 18 months, I would love to see this all the way through," he said. "I'm in pretty good shape. I'm looking forward to seeing this all the way through until the last share gets sold."
As for the company itself, he said AIG remains a well-diversified operation and downplayed concerns that the firm is losing employees to competitors.
"There is a core of people in leadership positions that created what AIG is today, before the disaster, and therefore they're going to be here to rebuild it," Benmosche said. "We're not losing people as much as people think."
AIG was one of a handful of companies that became emblematic of the crisis that decimated the financial industryin 2008 and 2009.
The company's main role was in issuing insurance—called credit default swaps—that backed up the subprime mortgage industry, which collapsed as housing prices fell. AIG got into trouble because it did not have the reserves to pay off on the swaps.
Fearing that the collapse of AIG would spread through the US and global economy and cause systemic disaster, the government stepped in to take its stake in the company.
The capitalization was inteded to simplify AIG"s $182 billion bailout by paying off the Federal Reserve and leaving the US Treasury as the company's majority owner. The Treasury said on Friday that its cash investment in AIG is now $68 billion.
"Treasury remains optimistic that taxpayers will get back every dollar of their investment in AIG," Treasury Secretary Timothy Geithner said in a statement.
—Reuters contributed to this report.