HIS WORK IS DONE

Oct. 5 (Bloomberg) -- AIG Chief Risk Officer Robert Lewis is stepping down after saying that the company underestimated the risk of bets tied to subprime mortgages. “We were wrong about how bad things could get,” Lewis told the Financial Crisis Inquiry Commission in June. “What ended up happening was so extreme that it was beyond anything we had planned for.”

Chief Executive Officer Robert Benmosche is overhauling management at the insurer, which was bailed out in 2008 by taxpayers and posted the biggest quarterly loss in U.S. Benmosche said in a memo to staff today that Lewis will remain with AIG for “a period of time to ensure a smooth transition.”

Lewis joined New York-based AIG in 1993 and was named chief risk officer in 2004, according to the memo. He told the FCIC that responsibility for liquidity-risk management fell to others at the company.