(Updates throughout with additional information.)
DOW JONES NEWSWIRES
New York Governor David Paterson said Eric Dinallo would resign
as New York state insurance superintendent July 3, after serving in
that role for just over two years.
Dinallo will leave the post to take a teaching position at New
York University's Stern School of Business. There has been
speculation Dinallo may run for attorney general of New York if
current Attorney General Andrew Cuomo sought another post.
Paterson on Thursday said Dinallo played "an integral part in
the reform of workers' compensation system and facilitated more
than $15 billion in new capital for the bond insurance
industry."
Dinallo also testified before Congress for regulation of the
credit default swaps that were integral to the financial crisis.
Prior to his role as state insurance superintendent, Dinallo served
as managing director of the Global Head of Regulatory Affairs for
Morgan Stanley (MS). He also served in then-Attorney General Eliot
Spitzer's office from 1999 to 2003.
In the first part of his stint as insurance superintendent,
Dinallo played a key role in discussions aimed at stabilizing bond
insurers such as MBIA Inc. (MBI) and Ambac Financial Group (ABK),
which were stung by their exposure to mortgage-related
securities.
Dinallo also worked closely with the Treasury Department, the
Federal Reserve Bank of New York and others in the rescue of
insurance giant American International Group Inc. (AIG).
Republicans have questioned the timing of the funds, as the state
Democratic Party received a $100,000 donation from AIG days before
officials initiated a bailout.
-By John Kell, Dow Jones Newswires; 201-938-5285;
john.kell@dowjones.com