The Federal Reserve tapped former Allstate Corp. C.E.O. Edward Liddy to take charge of American International Group, as part of its $85 bailout plan to keep the colossal insurer from collapsing.
Liddy replaces Robert Willumstad, who took the helm of A.I.G. just three months ago. The Fed demanded that Liddy replace Willumstad as part of its historic loan, according to several reports.
Given A.I.G.'s $1 trillion in assets and 74 million clients in 130 countries, the Fed determined it needed to rescue the insurer to keep further shockwaves from rattling the global financial system.
A.I.G. has piled up $18 billion in losses during the last three quarters.
Liddy, 62, a partner at the private equity firm Clayton Dubliner & Rice, has won high praise for stewarding Allstate from 1999 to 2006. He is a "brilliant strategist," Robert Pike, a former chief administrative officer at Allstate, told Bloomberg News. "He's able to take an extraordinary amount of data and synthesize it, probably better than anybody I ever met," Pike added.
Before Allstate, Liddy served as chief financial officer for Sears Roebuck & Co. He joined Allstate in 1994 and oversaw Sears' spinoff of its Allstate segment.
"Ed Liddy led Allstate from being a typical average performance subsidiary of Sears to becoming one of the best- capitalized and best-managed insurers in the U.S.," Cliff Gallant, an analyst at KBW Inc. told Bloomberg News. "He is known for integrity and strong leadership."
Liddy is a director of Goldman Sachs, Boeing Co., and 3M Co., according to a Chicago Tribune report. He has an undergraduate degree from Catholic University of America and an M.B.A. from George Washington University.