Markets plunge as AIG sheds derivatives head

The Dow Jones lost over 300 points after American International Group Inc. reported dismal quarterly results and the resignation of chief credit derivatives officer Joseph Cassano. At closing, the Dow Jones Industrial Index fell 315.79 to 12266.39, the Nasdaq dropped 59.19 points to 2272.38 and the S&P 500 fell to 1331.73 after shedding 35.95 points. Mr. Cassano stepped down today after the insurer reported dismal quarterly results. His retirement will be effective on March 31. Throughout the rest of the year, he will consult with the company, said CEO Martin Sullivan, in a conference call this morning. Mr. Cassano’s exit follows the report of AIG’s largest quarterly loss of $5.29 billion, or $2.08, per diluted share. That’s down from $3.44 billion, or $1.31, per diluted share for the same period in 2006. The New York-based insurer provided had no additional comment.