Of the seven financial firms that received “exceptional assistance” bailout funds during the 2007-2009 financial crises, three remain indebted to the U.S. Treasury Department.
The chief executives of those three companies, Ally Financial (PINK:GMSPZ), General Motors (NYSE:GM), and American International Group (NYSE:AIG), all saw their executive compensation frozen for a second consecutive year, as they continue to make progress towards repayments of debt owed to the Treasury.
The Treasury also indicated that total compensation for 69 additional senior executives and employees at the firms was being cut by 10 % from 2011 levels according to CNBC.
While the executives were not directly named by the Treasury, the top spots at all three companies are held by widely known executives: Robert Benmosche at AIG, Daniel Ackerson at GM, and Michael Carpenter at Ally.
The pay packages of the executives will contain a mix of stock, stock options, and cash that still manages to put them into the now famous 1% category: the AIG package is worth $10.5 million, GM’s is worth $9 million, and Ally’s $9.5 million.
All three companies to continue to make progress towards repayment of all debts owed from the Troubled Asset Relief Program (TARP). AIG received $68 billion, GM $50 billion, and Ally $17 billion.
AIG has reduced their balance to around $17 billion, GM $25 billion, and Ally is now down to around $11 billion.
The compensation packages for all three companies will continue to be monitored by a “special master,” situated in the Treasury Department until such time as they have completely paid back the monies owed. The Obama administration set up the system to avoid exorbitant payouts to executives of firms involved in the TARP program.
— Marc Bastow, InvestorPlace Assistant Editor