Top Executives at Bailed-Out Firms Have Pay Cut

CEOBy DEREK KRAVITZ, AP Economics Writer

WASHINGTON (AP) -- Top executives at three companies bailed out by U.S. taxpayers during the 2008 financial crisis were ordered to take pay cuts by the federal government.
The Treasury Department says nearly 70 executives at American International Group, Ally Financial and General Motors had their annual compensation reduced by 10%. The CEOs of each company had their pay frozen at 2011 levels.

All three companies have yet to repay what they received from the $700 billion bailout and therefore are subject to pay cuts.
AIG still owes taxpayers around $50 billion. General Motors owes about $25 billion. Ally Financial about $12 billion.

Even with the compensation freeze, the chief executives are expected to be well paid this year. GM CEO Daniel F. Akerson is expected to earn $9 million in stock and salary this year. Ally Financial's CEO Michael A. Carpenter is set to earn $9.5 million in total compensation. AIG CEO Robert Benmosche will make $10.5 million.

NEXT: America's 10 Highest Paid CEOs: Which Are Worth the Money?




Increase your money and finance knowledge from home

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

Managing your Portfolio

Keeping your portfolio and financial life fit!

View Course »

Add a Comment

*0 / 3000 Character Maximum

55 Comments

Filter by:
unichems

Salary Cut 10% ? Should be Terminated!!!

April 09 2012 at 2:07 PM Report abuse rate up rate down Reply
sandbar4fun

WHAT...'NO JAIL TIME'...?????

AMERICANS... listen up...elections will soon be upon us. DEMAND: TERM LIMITS for both PARTIES, NO MORE CAREER POLITICANS.
END 'SUPER PACs', END 'LOBBIEST'. END 'SPECIAL INTERESTS GROUPS'

April 09 2012 at 12:44 PM Report abuse +3 rate up rate down Reply
ccm989

Here's where the stockholders come into play. There is an annual shareholder meeting. The Board gets to suggest a salary. The stockholders get to vote yea/nay on it. Why vote a huge salary for the CEO who is only making himself rich while laying off employees and screwing shareholders? If you are a shareholder, you have a say in this matter. And you can make your voice heard by voting at the annual shareholder meeting.

April 09 2012 at 12:12 PM Report abuse +2 rate up rate down Reply
ctheleroys

Boohoo. Too bad, so sad. Did they lose their jobs, homes, finical security like millions of others did? Well now.

April 09 2012 at 10:39 AM Report abuse +3 rate up rate down Reply
Gary

maybe its time to give back to the retires what they lost and made GM what it is.

April 09 2012 at 9:15 AM Report abuse +2 rate up rate down Reply
Frank

In a different context, an average compensation of $9.5 million comes out to about $26,000 for every day of the year. Just saying.

April 09 2012 at 8:16 AM Report abuse +3 rate up rate down Reply
Mare

Why are they getting sny bonus' st all? Seems they suck at their jobs.

April 09 2012 at 1:29 AM Report abuse +4 rate up rate down Reply
estimatorone

First, a 10% pay cut for these people is really chump change to them because they
will make up the differences with bonuses, etc. Also,They will make up this money,
and then some, by the end of this year, or, as soon as they pay back their bail out
money. Just wait and see. Remember when the financial market crashed? The
most important thing that the banks had on their mind was to insure that their
executives, and certain "producers", got their bloated salaries and bonuses, at
the cost of tens of thousands of lost jobs and homes. What the government is
doing is to try to save face.

April 09 2012 at 12:22 AM Report abuse +1 rate up rate down Reply
estimatorone

First, a 10% pay cut for these people is really chump change to them because they
will make up the differences with bonuses, etc. Also,They will make up this money,
and then some, by the end of this year, or, as soon as they pay back their bail out
money. Just wait and see. Remember when the financial market crashed? The
most important thing that the banks had on their mind was to insure that their
executives, and certain "producers", got their bloated salaries and bonuses, at
the cost of tens of thousands of lost jobs and homes. What the government is
doing is to try to save face.

April 09 2012 at 12:22 AM Report abuse +1 rate up rate down Reply
Maggie

What about Fannie and Freddie?

April 08 2012 at 11:51 PM Report abuse -2 rate up rate down Reply