Sullivan latest to fall prey to credit crunch

Martin Sullivan, the English chief executive of the US insurance giant American International Group (AIG), was given his marching orders yesterday, a direct result of risky speculations in the subprime mortgage markets. Sullivan's departure, after just three years in the job, followed mounting unrest among shareholders, who called the emergency board meeting that led to his resignation. Under him, write-downs in the market value of AIG's assets are believed to have mounted to around $30bn, causing its share price to halve in just one year.

It is a personal blow to 53-year-old Sullivan. He had been with the firm all of his working life, joining as an insurance clerk at the age of 17. He has been replaced by the American banking veteran Bob Willumstad, who had been the insurer's chairman and is considered a safe pair of hands.

In stepping down, Sullivan joins a growing list of Wall Street executives, including Citigroup's Charles Prince, and Merrill Lynch's Stan O'Neil, who have lost their jobs as a result of the subprime crisis. However, Sullivan is unlikely to feel the pinch of the growing recession himself. According to the terms of his contract, he is entitled to a severance package in the region of $35m. ·