NEW YORK (Reuters) - A prominent U.S. senator backtracked on comments that American International Group Inc executives might consider suicide, but he still wants them to apologize for ruining the giant insurer.

Senator Charles Grassley, the top Republican on the Senate Finance Committee, said on Monday that AIG executives should perhaps “resign or go commit suicide,” adopting what he called a Japanese approach to taking responsibility for their actions.

In a Tuesday conference call with reporters, Grassley retreated from those comments, but urged the executives to express regret, and perhaps to resign.

AIG is under fire for paying out $165 million of bonuses despite a series of taxpayer bailouts for the company totaling $180 billion. Some of the bonuses went to people at the AIG unit principally responsible for the insurer’s distress.

“What I’m expressing here, obviously, is not that I want people to commit suicide,” Grassley said on Tuesday. “But I do feel very strongly that we have not had statements of apology, statements of remorse, statements of contrition on the part of CEOs of manufacturing companies or banks or financial services or insurance companies that are asking for bailouts, that they understand that they are responsible for running their corporation into the ground.”

On Monday, in an interview with a radio station in his home state of Iowa, Grassley fired a gibe at AIG executives, saying they might “follow the Japanese example and come before the American people and take that deep bow and say, I’m sorry, and then either do one of two things: resign or go commit suicide.”

AIG called those comments “very disappointing.”

President Barack Obama on Monday expressed “outrage” about the AIG bonuses, and lawmakers in Congress on Tuesday called either for AIG to be sued to recover the bonuses, or for the government to levy hefty taxes on bonus recipients.

New York Attorney General Andrew Cuomo, meanwhile, in a letter to House Financial Services Committee Chairman Barney Frank, said 73 AIG employees received bonuses of $1 million or more in 2008, with the top recipient getting $6.4 million.

Grassley on Tuesday said U.S. executives might adopt practices of Japanese business leaders in admitting mistakes.

“Japanese CEOs either go out and commit suicide, and probably in most cases they don’t, and when they don’t they come before the public and bow very, very deeply, and express regret, and may resign or may stay on, but the point is they accept full responsibility,” he said. “I haven’t heard this from the CEOs.”