NEW YORK – Robert B. Willumstad, who left Citigroup Inc. (C) after being passed over for the top management job, has been selected as the new chairman of the board of American International Group Inc. (AIG), one of the world's largest insurance companies.
AIG said Wednesday that Willumstad, 61, will succeed Frank G. Zarb, who has been interim chairman since April 2005.
Willumstad, who had been president and chief operating officer of Citigroup, announced in July 2005 that he was leaving the nation's largest bank to seek the top job at a public company. He resigned after Charles Prince was named chief executive, replacing the retiring Sanford Weill; Prince later also was given the title of chairman.
Zarb had been named to interim chairman after Maurice "Hank" Greenberg was forced to resign in March 2005 amid a widening accounting scandal. Greenberg had led the company for nearly 40 years.
In February, AIG agreed to pay $1.64 billion to resolve allegations that it used deceptive accounting practices to mislead investors and regulatory agencies. The deal also required AIG to adopt changes in its business practices that will ensure proper accounting procedures in the future.
The settlement did not cover Greenberg, who is still being pursued by New York Attorney General Eliot Spitzer and federal regulators on accounting issues.
AIG said in a statement that Willumstad's appointment would be effective Nov. 1. He was elected to the AIG board in January. AIG said the unanimous decision to name him chairman came at a board meeting in London.
Zarb was to remain an AIG director and serve as a nonvoting member of each standing committee of the board, the statement said.
In the statement, Zarb called Willumstad "a superb choice" for the job.
Martin Sullivan, who was named chief executive and president of AIG after Greenberg's resignation, said in the statement: "I am delighted with the action the board has taken and look forward to working with Bob Willumstad and the board in continuing to strengthen the AIG franchise around the world."
As board chairman, Willumstad will be an ex-officio nonvoting member of each standing committee of the board.
AIG said that after Willumstad takes his new post, Morris W. Offit will succeed him as chairman of the finance committee and Michael H. Sutton will succeed Offit as chair of the audit committee.