US-based global insurance company American International Group (AIG) plans to cut up to 1,500-1,900 jobs, as part of its strategy to streamline operations.
AIG, which was on the verge of being collapsed during the financial crisis of 2008, said that the job cuts will mainly affect the employees working at its property casualty division, which covers homes, cars, and businesses.
In order to bring the company back on the profitable track, the insurer has divested many non-core operations and reduced operational expenses.
The insurer posted profit in seven of the last eight quarters and returned approximately $200bn to the US Treasury and Federal Reserve.
For the fourth quarter ended 31 December 2013, AIG reported a net income of $2bn, compared to a loss of $4bn a year earlier.
AIG incurred a pre-tax severance charge of $265m associated with these initiatives primarily related to AIG Property Casualty during the fourth quarter of 2013.
AIG president and CEO Robert Benmosche said AIG’s strong performance in both the fourth quarter and the full year of 2013 represents another successful milestone in its journey to further build on AIG’s core insurance operations.
"In addition, our fourth quarter severance charge represents another step in AIG’s continued transformation. We are increasingly a more agile, focused, and sustainable company. As we think about the long-term future of our company, we must be able to more efficiently meet and exceed the evolving expectations of our global customer base," Benmosche concluded.
Image: AIG Building on 175 Water Street, New York City. Photo courtesy of AIG.