Citigroup (NYSE: C) reorganized its management, probably in reaction to the huge write offs it took in the last quarter. Almost everyone got a new job, other than CEO Chuck Prince.
Citi is pushing out its head of trading and one of its fixed income chiefs even though as Reuters points out "Citi's warning last week left some investors calling for Prince's ouster." As one analyst told the news agency: "Clearing the bench may be therapeutic, but it doesn't necessarily improve Citi's ability to fix the mistakes that were made or seize opportunities in these markets."
All of the demands that Prince leave neglect to consider that Citi's shares have done no worse than those of other big banks. While its shares are off about 3% over the last year, so are the stocks of Bank of America (NYSE: BAC) and JP Morgan (NYSE: JPM).
Prince may be a poor manager, but he is also a victim of his times. If he goes, so should the heads of other large banks, or the market can wait to see if Prince can fix things.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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Reader Comments (Page 1 of 1)
10-12-2007 @ 8:47AM
shelly said...
Here's a unique article for some additional insight on Citigroup's management, specifically regarding its board of directors: http://www.newsvisual.com/newsvisual/2007/10/management-expe.html
It would be interesting to know if any of these connections are actually taken advantage of by Citi- could take some of the heat off of Prince if they're actually as useful as the author makes it sound.
10-13-2007 @ 8:46PM
drew said...
It is not this years performance that should make Prince resign, (although he deserves no medal either) it is the peformance since he took over as CEO four or five years ago.