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November 22, 2008 8:51:50 AM CST

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Citi Pulls Plug on Hedge Fund CEO Founded

Posted Jun 12, 08 9:47 AM CDT in Business 

(Newser) – Citigroup will close Old Lane Partners, a hedge fund co-founded by CEO Vikram Pandit, after months of lackluster returns and the loss of its top managers, the Wall Street Journal reports. The investment bank bought the fund’s management group for $800 million less than a year ago; Citi will buy its remaining assets and take a writedown in the second quarter.

Citi’s own tight resources—it has reported losses of some $15 billion over the past two quarters—helped speed the end of the fund after the bank decided not to pump in $1 billion more. Pandit founded Old Lane in 2006 after leaving Morgan Stanley; he made $165 million when Citi bought it in July 2007, though $100 million remains frozen for 3 more years.

Source Wall Street Journal

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The Citibank logo is shown on a branch office in this April 11, 2007 file photo in New York.   (AP Photo)
Citigroup CEO Vikram Pandit   (AP Photo)
The Citigroup Center in New York.   (AP Photo/Mary Altaffer)
People pass the Citigroup Center n New York.   (AP Photo/Mark Lennihan)
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