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Vikram Pandit named Citigroup CEO
Thursday, 13 December 2007, 17:44 IST
Washington: Citigroup, a financial services company, has appointed Nagpur-born Vikram Pandit as the company's new chief executive officer (CEO) and a member of its board of directors.
The appointment of 50-year-old Pandit, who moved to New York from India at the age of 16 to attend Columbia University, was announced in New York Tuesday. He is currently chairman and CEO of the Institutional Clients Group, which comprises Citi Markets and Banking, and Citi Alternative Investments.
The bank also named Winfried F.W. Bischoff, the acting chief executive, as chairman, succeeding Robert E. Rubin, the former US treasury secretary who stepped into the role when Charles O. Prince III resigned Nov 4.
At that time the bank was facing up to $11 billion in new losses tied to its exposure to mortgage-related investments after racking up about $6.4 billion in third-quarter write-downs, including about $1.6 billion stemming from subprime mortgages.
Rubin will return to his previous role as a member of the Citigroup board of directors and chairman of the executive committee of the board.
Pandit is reported to have edged out another Indian, Ajay Banga, who runs Citigroup's international consumer group, for the plum job. Others in the running included former Citigroup president Robert Willumstad and Michael Neal, who runs General Electric Company's (GE) commercial-finance business.
A former president and CEO of Morgan Stanley's Institutional Securities Group, Pandit joined the Citigroup only six months ago after it bought Old Lane Partners, a hedge fund and private equity fund manager founded by him, for an estimated $800 million.
"Citi is an extraordinary institution with tremendous talent, resources and capabilities and geographic and business scope. Our challenge is to capitalise on these strengths to deliver the high-quality service and products our clients require and to generate the superior returns our shareholders expect," Pandit said after his appointment.
"Simplifying the company's organisational structure and aligning our businesses and resources with appropriate goals and economic realities will be among our initial priorities," he said vowing to work closely with the board "to assure that our strategy, structure, scale and diversification position the company for growth."
Commenting on his appointment, the Wall Street Journal said: "Pandit will face a tall order in rejuvenating Citigroup's stock price, which has plunged 38 percent this year."
"Fixing Citigroup will not be easy," said the New York Times noting, "Pandit has never run a public company, let alone one as big and complex as Citigroup."
"The company could face billions of dollars in additional losses on troubled home loans. Its stock price has fallen 40 percent this year, and its balance sheet is overstretched," it said.
On Pandit's appointment, Rubin said: "Vikram has earned a reputation as one of the most respected leaders in the financial services industry. The combination of his deep executive experience and long history as a strategic thinker makes him the outstanding choice to be Citi's CEO.
"During Vikram's time at Citi, he has come to know this company and its people, and he has earned the respect of managers and directors alike for his incisive intellect and ability to balance risk and opportunity in making and executing tough decisions.
"The board is unanimous in its conviction that, as part of a new generation of executives in this industry, Vikram is the right leader to build on the exceptional strengths of this great company and take the steps necessary to lead us forward."
Prior to forming Old Lane, Pandit was president and chief operating officer of Morgan Stanley's institutional securities and investment banking business and was a member of the firm's management committee.
Previously, he served in various roles as head of the equity division, head of derivative sales and trading, and managing director and head of the equity syndicate. Pandit joined the investment banking division of Morgan Stanley in 1983.
Pandit serves on the boards of India School of Business, Hyderabad, Columbia University, Columbia Business School, and the Trinity School, New York. He is a former board member of NASDAQ, New York City Investment Fund, American India Foundation and the Council on US Competitiveness.
He earned a PhD in Finance from Columbia University and holds a Master's degree and a Bachelor's degree in electrical engineering from Columbia University. He also had a teaching stint at Indiana University in Bloomington.
Source: IANS
Source: IANS