The die has been cast, Prince has resigned as CEO and Chairman of Citigroup. In his place, Former Secretary of the Treasury, Robert Rubin and current Citi board member has been made chairman. Sir Win Bischoff, chairman of Citi Europe and a Member of the Citi management and operating committees, was made interim CEO. Bischoff will remain interim CEO until a successor is found.
On top of the management changes Citigroup said it would take an additional $8 billion to $11 billion in write-downs related to mortgage-related securities. Hopefully, no more shoes will drop. Citi insists it will not reduce its dividend as was suggested by some analysts late last week.
Monday should help sort out exactly what is next with more updates on the changes and how Citi plans to deal with the situation in the short-term.
Stay tuned.
For more:
Citigroup Press Release
Deal Book
Independent UK
Australian Business (WSJ)
Bloomberg
Crains
MarketWatch
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Last October when Citigroup’s financial difficulties began to emerge, many news groups, including NewsVisual http://www.newsvisual.com/newsvisual/2007/10/management-expe.html , wrote articles that voiced cautious optimism concerning the company’s ability to turn the corner and avert major losses. They based their prediction on the company’s collective management experience. Where those sanguine predictions unreasonable at the time?
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