AIG's Liddy to step down

American International Group (AIG, news, msgs) late Thursday said Chief Executive Officer and Chairman Edward Liddy will step away from the helm of the troubled company once a replacement is found.

Liddy, who was tapped to run the company by the government back in September, recommended that the chairman and CEO positions be split.

"It really is a terrible job -- I'm not sure who would really want it," Robert Haines, an analyst at CreditSights, told Bloomberg News. "There is so much political baggage that whoever takes over the company is going to find it an extremely difficult and thankless job."

Liddy was paid just $1 per year but nevertheless struggled under the burden of the company's troubles and the bonus blowup. AIG, which received $182 billion in bailout money from the government, paid $165 million in bonuses to executives in its financial products division, which is the division that got the company into trouble.

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"Much work remains to be done at AIG, but much has already been accomplished," Liddy said in a statement. He noted that the company's recovery "is likely to take several years, (and) AIG should have a leadership team committed to a similar time horizon and prepared to carry the plan to completion."