It looks like the chairman of the board at Citigroup (NYSE: C) is about to lose his position. It is a shame. He was doing such a good job. The bank's stock yesterday fell below $10 for the first time in over a decade.
According to The Wall Street Journal, "The board of Citigroup Inc. is growing increasingly dissatisfied with the financial giant's performance, and some directors are considering replacing Sir Win Bischoff as chairman." The lead candidate to take the job is former Time Warner (NYSE: TWX) chief Richard Parsons.
While the board-level change is not a sure thing, the revolt among directors seems to be aimed in the wrong direction. Vikram Pandit, who was made CEO a year ago, has effectively ruined any turnaround at the company by being slow to sell-off under-performing assets and cut expenses. The bank's shares performance has trailed that of every one of its peers.
Citi is like most large companies. The non-executive chairman has very little to do with running the company day-to-day. Firing a big company CEO after only twelve months on the jobs is unusual, but Citi's performance is so dismal that dumping the real culprit, Pandit, is a better idea than attacking the problem at the board level.
Douglas A. McIntyre is an editor at 247wallst.com.
Tesla Roadster sets a record -- travels 313 miles on a single charge
Cramer on BloggingStocks: China's industrial focus helps lots of U.S. names 
Why do we have a weak dollar?
Reader Comments (Page 1 of 1)
11-13-2008 @ 11:36AM
alan said...
With the common share now below $10, it's a long, very long climb back.
While JP Chase, BoA, and Wells have made strategic acquisitions that position themselves well for the future, Citi has made excuses and is selling-off valuable assets, ie. Citi Germany.
This once great company may indeed fail with the huge amount of level III crap still on and off the books.
What the hell is the Board waiting for? Mr. Pandit has only made a bad situation worse--it's one year +, he needs to go !!
Dick Parsons and the rest of the Board need to get the shitcan also. What are these guys doing? Do they think they are watching a movie and are waiting for a happy ending? Where is the shareholder revolt?
Of course cleaning house will not happen. My fear is that Citi will be as relevant to financial services in the future as GM is to the auto industry !!
11-13-2008 @ 8:56PM
Beltway Greg said...
Don't despair, Vikram bought 750,000 shares and Citigroup bought (and then liquidated) Old Lane. They're even if you get my drift. This has been a dependable short term play for me all year until recently. Whenever it dropped below $15 clams I bought a few K and rode it to an appropriate level and dumped it. Now I'm stuck for the foreseeable future. And what about that damn GE that Sheldon Liber made me buy. I knew better but he's such a strong persuader.
Beltway Greg
11-21-2008 @ 9:15AM
Sheldon L said...
"...made me buy."
GE stonger than C...
...and I'm in the same boat, I eat my own cooking Greg.