Brand Restored

Benmosche has restored the AIG brand name to the property- casualty and U.S. life units this year while highlighting the company’s rebound as he bought back shares to help wind down the bailout. The company has posted four straight profitable quarters, driven by investment gains and a tax benefit. The CEO introduced a new logo and agreed to sponsor New Zealand rugby teams including the All Blacks.

AIG surged 5.7 percent to $35.26 at 4:11 p.m. in New York, bringing its gain to 52 percent this year. Still, the company is down more than 90 percent from the end of 2007.

“Management should place a stronger sense of urgency on driving expense levels down,” John Nadel, an analyst at Sterne Agee & Leach Inc. wrote in a Dec. 5 research note. “It might afford management the opportunity to spend parent company cash in a manner more ‘friendly’ to shareholders” such as paying a dividend, buying back shares or making acquisitions.

AIG has said it’s working to cut general and administrative expenses by about $1 billion from 2010 levels by the end of 2015. The insurer is weighing a move from its headquarters in lower Manhattan as part of a cost-saving consolidation, two people familiar with the matter said in July, asking not to be identified because the deliberations are private.

Supervision Welcomed

AIG is also seeking to improve relations with regulators after Federal Reserve Chairman Ben. S Bernanke said that the company “exploited a huge gap in the regulatory system” before Benmosche took over, and operated its derivatives unit without oversight.

“We welcome supervision by the Federal Reserve,” Benmosche wrote in a Nov. 1 letter to the U.S. regulators, saying he wouldn’t contest a designation as a potential risk to the financial system. Such companies face tighter capital rules.

While AIG reduced risk from derivatives and worked to improve liquidity, the sale of the AIA Group Ltd. and American Life Insurance Co. life divisions reduced the prospects for growth in emerging markets. The divestitures, and an agreement this week to sell a plane-leasing unit, also eliminate a cushion the insurer had against natural disasters hurting results at property-casualty units.

Ex-CEO Maurice “Hank” Greenberg, who built AIG over more than four decades, said Benmosche was unable to benefit from the same diversification of risk. AIG has sold more than $65 billion in assets since its rescue, including consumer lenders, real estate and a reinsurer, to help repay the bailout.