AIG Holds First Shareholder Meeting Since Its Collapse

NEW YORK, June 30 -- Russell and Kathy Ryan left their Brooklyn home early Tuesday and boarded a rush-hour subway car bound for Wall Street, where the country's largest federal bailout recipient was holding its first shareholder meeting since its collapse last fall.

The Ryans navigated the television cameras outside American International Group, the row of metal detectors inside and the Secret Service-like security guards posted in every corner of the eighth-floor meeting room, which doubles as a company cafeteria.

A few years ago, they had sunk $180,000 in retirement savings into AIG stock because the global insurance giant seemed like a safe bet. But like so many shareholders, they have watched their investment nearly vanish.

The gray-haired couple listened quietly as chief executive Edward M. Liddy said that AIG has an "excellent chance" of repaying the government and that the company "is far more stable than it was only several months ago." He also acknowledged that any recent progress is "little consolation for the losses you have suffered."

When Liddy opened the floor to questions, Kathy Ryan stepped to the microphone. She told him about the lost savings, the retirement more precarious than it once seemed. She asked if the couple's AIG stock was worth keeping, if there was any hope of recovery, or whether she and her husband should simply write it off as a lost cause.

"Sir," she asked softly, "what do you think we should do?"

"I'm such a bad stock picker," Liddy said, deflecting the question. He suggested that the Ryans seek out a financial adviser. "I'm sorry for what's happened to you," Liddy said, adding, "I wish you luck."

AIG's annual meeting was notable mostly for the Kathy Ryans of the world who didn't bother coming. Aside from the tight security, it felt more like a staid city council meeting than a debate about the future of a massive global company that the government has committed nearly $180 billion to saving. Barely 200 people showed up, some of them former employees whose savings had been primarily AIG stock. Plenty of empty seats remained in the room, and only a few attendees asked questions or voiced frustrations to Liddy.

No one mentioned that AIG had lost nearly $100 billion last year, and another $5 billion already this year. There was scant discussion about the millions of dollars in retention bonuses to executives at AIG Financial Products, the unit whose faulty derivatives brought the insurance titan to its knees last fall.

The gathering lacked the drama and duration of recent shareholder meetings at other bailout giants, such as Citigroup and Bank of America. Nearly all of AIG's proposals on its agenda -- including a wholesale overhaul of its board of directors -- were approved easily and with little or no comment. That could be in part because the U.S. government holds a nearly 80 percent ownership stake in the company, leaving three federally appointed trustees with almost complete control of shareholder interests.

Ken Steiner of Great Neck, N.Y., who said he holds about 10,000 AIG shares, was one of the few shareholders who came to vent. He likened the previous board of directors who "presided over the downfall of this company" to "rats leaving a sinking ship." Steiner questioned the risk-management and internal-review practices that allowed AIG to implode.

"We've lost 99 percent of our money," he told Liddy. "We don't see anybody being held accountable. Who's responsible? And who is going to be held accountable?"

He also encouraged fellow shareholders to keep close watch on the new board of directors.

Tuesday's meeting lasted only an hour. Neither Liddy nor other executives stuck around to speak with shareholders or reporters.

The Ryans began to head back downstairs, past the metal detectors and TV cameras, for the subway back to Brooklyn. They were disappointed in not having found more answers, in being left to wonder how to best recover their losses.

For now, Kathy Ryan said, "we are much more careful with money."