The New Masters of Risk? How insurers are testing out their capabilities in finance
The New Masters of Risk? How insurers are testing out their capabilities in finance
Insurance poll results
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| Martin Sullivan, CEO, AIG |
INVESTORS IN GLOBAL insurance stocks shuddered in February when auditors at AIG, the industry leader, announced that they had discovered a material weakness in the way the company valued credit default swaps. Just a few months earlier, AIG had suggested that it might take a write-down of a little over $1 billion on its credit portfolios. But when it published audited results at the end of February 2008, write-downs amounted to $11.1 billion, mainly in AIG Financial Products Corp, with a fourth-quarter group loss for 2007 of $5.3 billion. It’s a challenging moment for chief executive Martin Sullivan, who took the top seat at AIG three years ago when the legendary Hank Greenberg, who drove the company to its global leadership position, left amid a dispute over questionable accounting for reinsurance that entailed less than complete risk transfer.
