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Football / Re: AIG & Manchester United
« on: March 19, 2009, 02:12:37 PM »
You told me that you'd be shocked if that's where the Risk Management team came from and not from within AIGFP itself. All I was told is that they were sent from NY. I know the Inc.'s HQ is in NY which is why I said the "parent company" sent them. I admitted that I wasn't clear on the details as to exactly where, what address they originated from... but it clearly wasn't Danbury, CT and wasn't London.
Just because the oversight was initiated in NY...did it say that?, and the parent company is in NY, doesn't mean the oversight was initiated by the parent- again it seems like you're not understanding how a holding company is set up and how the parent sub relationship functions under a holding structure....or maybe I'm oversimplifying because I admittedly don't fully understand the complexities of AIG's corp structure...not sure if anyone on this msg board does.
From my undertanding a holding company is just a legal formation...in effect it would consist of ownership agreements and legal documents, Directors, Officers and in some cases some management- that's all. No relativley significant assets (other than the shares of its subs), no personnel/staff making the decisions at the level that you're implying. The directors & officers of the parent are ultimately the D&O's of the subs and they exercise their influence by running the boards of the subs, not necessarily as representatives of the holding company (parent), but as Board members/reps of the subs....The parent-sub relationship in a holding structure is not typically one of oversight at the level that is being discussed, because the holding company (parent) is set up ONLY to hold shares/voting rights, and consolidate the presentation of financial statements not to do the kind of oversight business as the parent that you imply...Holding companies don't typically have the resources to do (initiate) that kind of thing- the autonomy would realisitcally lie somewhat in one of it's operating businesses (a sub)....All business of the nature that we're discussing, in a holding structure is carried out by the subsidiaries. In the case of oversight, there's probably (using a generic term) some sort of management company in place, or a corporate/non-revenue generating arm....or some oversight committee maybe appointed by each BOD that would initiate such... not the parent...audit committees are appointed by the BOD, and they deal with appointing auditors etc....Not the holding parent. If you've worked for company that operates under a holding structure you'd know what I'm talking about. Of course oversight policy at all levels is likely to be set at the parent level... runs through the entity to the highest rung, because in the end, it needs to be signed off at the highest point, but I'd be surprised if the ins and outs of it through the course of business are initiated at the parent level (if it's a holding company), as opposed to being delegated to the operating units.
Next time you get a chance, go to SEC.gov and go through the 10-k of a Holding company, and you'll see it is merely a consolidation of its subs....by itself, there's no revenue, expenses, assets or liabilities. If a parent company is exercising the kind of oversight that you're trying to imply it would probably NOT be a holding company by definition..AIG inc. is a holding company that operates business through its many subsidiaries.
If you can consclusively prove otherwise (which that link does not do and I highly doubt anything will), then ok...but in the absence of that, the understanding of a holding structure and what a holding company effectively is, should deter you from making the assumptions that you make. Given the complexity of AIG, by the sheer size of the company, there's a chance that it isn't as black or white as either of us see it though....which could probably partly account for why they're in this mess to begin with.
Your definition of a holding company is not how AIG is structured. AIG has full goverance over all units. Most decisions are made by the holding company because the holding unit is who files to the SEC.