TNI Bureau: Citigroup’s CEO Vikram Pandit resigned on Tuesday after nearly a five-year tenure during which he steered US’s third-biggest bank through the difficult years after the 2008 financial crisis.
India born Pandit (55), who had been the CEO of Citigroup since December 2007, also stepped down as a member of its Board in a shock decision that came just one day after the quarterly results that beat market expectations despite a 88 percent drop in net profit.
India born Pandit (55), Pandit arrived at the bank in 2007 when it bought his Old Lane Partners hedge fund. He famously pledged to take a token salary of just one dollar for 2009 and 2010 till the bank returned to sustained profitability. After Citigroup repaid the bailout funds, his annual salary jumped to $1.67 million in 2011. He was awarded a bonus, options and other payments that year potentially worth about $13.2 million.
Pandit says,”Citigroup has emerged from the financial crisis as a strong institution and “now is the right time for someone else to take the helm at Citigroup.” The company, however, said it is an unexpected announcement that stunned Wall Street.
Meanwhile, the Board of Directors has unanimously elected Michael Corbat as CEO and a director of the Board with immediate effect.Citigroup further announced that President and Chief Operating Officer, John Havens, who also served as CEO of Citis Institutional Clients Group, has resigned. The bank offered no explanation for the sudden departure of its two top executives.
This spring, Citigroup shareholders took the unusual step of rejecting a proposed compensation plan for Pandit and other top executives in the say-on-pay vote.
The bank reported 88 per cent plunge in net profit at USD 468 million in the July-September quarter but the earnings were seen as surprisingly strong.
Citigroup said its third-quarter earnings plummeted because of a 4.7 billion dollar loss relating to the joint venture brokerage business Morgan Stanley Smith Barney.
Pandit had taken over at the helm of Citigroup at the start of the financial crisis. In 2009 and 2010, he played a challenging role to pull the bank back from the brink of a financial crisis.