Early last year, then-AIG CEO Peter Hancock warned that there was “no easy way to make this company valuable” and “no shortcuts.” Carl Icahn did not believe him: There was, in fact, an easy way and a shortcut, and it was firing Peter Hancock and hiring the guy who learned at the knee of the guy who was CEO the last time AIG was a valuable company, Hank Greenberg.
That Greenberg disciple, Brian Duperreault, has been at the helm for six months now, but has done nothing to prove Hancock wrong. AIG lost $1.74 billion in the third quarter. And while a goodly chunk of that was due to those three massive hurricanes hitting the U.S. in a month, the blame cannot be laid entirely at Harvey, Irma and Maria’s feet.
The separate pretax reserve boost of $836 million in AIG’s commercial-insurance unit came as a surprise. Reserve boosts at AIG—a leading world-wide seller of often-complicated property and casualty policies to multinationals and other large companies—had plagued his predecessor’s tenure, and many investors are hoping the worst is behind.