Management Turnover as Change Agent

Friday, April 18, 2008

Credit Crunch Phase Two CEO Changes?

In my previous blog, I recommended David Weidner's Market Watch story examining the shaky circumstances the CEOs from GE, WAMU and Wachovia face with regard to their long term status at their respective firms. This morning's, Deal Zone from Reuters mentions the possibility that Fred Goodwin, The Royal Bank of Scotland's highly respected CEO might also be at risk for his job.  According to Adam Pasick of Deal Zone,
Royal Bank of Scotland is set to announce a rights issue to raise as much as $20 billion next week, an industry source told Reuters ...
... It could also mark the end of an era for the bank’s well-respected chief executive, Fred Goodwin, whom analysts and shareholders say would face an uphill struggle to push through a hefty capital increase and remain in the job.
While I think Goodwin might manage to stay in place, we may be in store for a new round of CEO and CFO changes as the credit crisis continues to take more bites out of earnings.  Stay tuned.

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