Investors clearly weren't feeling all that secure about American International Group (AIG 0.83%) stock on Tuesday. After all, they traded out of the big insurer to the point where it closed nearly 8% lower in price. Much of this was due to a major development in the company's C-suite.
C-suite surprise
Before market open that day, AIG announced that its CEO and chairman of the board of directors, Peter Zaffino, is stepping down from the former position. He aims to do this by mid-year; however, the company did not provide a more specific time frame. At that point, Zaffino's goal is to transition to being only the executive chairman of the board.
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He is to be replaced by a veteran insurance industry executive, Aon's Eric Anderson. He will assume the role of CEO-elect on Feb. 16, transitioning to CEO proper at some point after June 1. At that time, he will also be appointed to the board.
AIG quoted its lead independent director, John Rice, as saying of Anderson's stint at Aon that he "reshaped the company's business portfolio, implemented a new data and analytics strategy, and delivered strong operational improvements."
"The board is confident that he is the right executive to be the next CEO of AIG," Rice added.
NYSE: AIG
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Meet the new boss
That may be so, but Zaffino's resignation was not expected, and as such, it comes as an unpleasant surprise. He led the company during a period when it achieved five consecutive years of underwriting profitability, following a period of notable losses. Anderson's history suggests he'll be a competent leader, but Zaffino won't be an easy act to follow.
