AIG to pay $1.1B in retain bonuses through 2011
The bailed-out insurer, American International Group said on Friday that its retention program that began in 2008 and would stretch through 2011 would cost approximately $1.1 billion.
Under the retention program, AIG provides key staff members with huge bonuses to help the company remain competitive.
However, the Congress has already put objection over company's program.
AIG, which has plans to pay out $249 million as bonuses during the second half of the running year, has already incurred $824 million on the program.
Veritas LLC's CEO Frank Glassner described the retention program as, "a poorly designed pay program that shareholders and taxpayers will have to bear the brunt of."
The retention plan will cost the company $18 million in 2010 and $ 1 million in 2011.
It should be noted here that AIG was saved by the government in bail outs of over $100 billion.
Some analysts believe that AIG requires experts to recover its business and to retain the experts it has to pay big bonuses.
Shares of AIG were trading at $27.11, up 20.3 percent.