Vikram Pandit's sudden Citigroup exit this morning came following "a clash" with the bank's board over "strategy and operating performance," the Wall Street Journal reports, based on an anonymous source. The departure blindsided Citi employees, many of whom found out via media reports. "There's shock," one executive says. "Even senior people were surprised." More on the move:
- A Bank of America analyst thinks Pandit's fate was sealed six months ago, when Michael O'Neill ascended to chairman of the board, according to Bloomberg.
- The Journal characterizes new CEO Mike Corbat as "Mr. Fix-it," explaining that he rose to prominence running Citi Holdings, the "bad bank" that took on all Citi's toxic assets following the financial crisis. He wound those assets down more quickly than expected. In a memo to employees today, Corbat warned that his rise "will result in some changes" in the bank's structure.
- Tongues are wagging over the move. Jim Cramer on CNBC and Charlie Gasparino on Fox Business Network both speculated that Pandit was fired, with Gasparino saying that a botched Morgan Stanley Smith Barney deal was the "last straw," Business Insider reports.
- "It raises tremendous questions," one investment executive tells Reuters. "Either he has the most incompetent public relations people advising him … or something suddenly has been revealed. … All of these things are just red flags everywhere."
- The market's snap judgment was negative; Citi's shares slumped 2.4% premarket, according to the Journal, which notes that Citi's stock has fallen 89% during Pandit's tenure.
- Former FDIC chair Sheila Bair, however, called it "a very positive move," telling Bloomberg she had "concerns about Mr. Pandit's qualifications" while praising O'Neill's track record. The Journal speculates that Bair's book, which savaged Pandit, may have helped do him in.