Citigroup CEO Prince to Review Losses

Citigroup CEO Charles Prince reportedly wants to review the bank's estimate on Monday of $3.3 billion in losses and writedowns for Q3, before making any decisions on firings, according to senior Citi executives as reported in the Financial Times. Citi expects a 60% decline in Q3 earnings as a result of "dislocations" in credit markets. (See full story). Citi insiders say CEO Prince's review could affect future leadership at both the investment bank division and the chief executive position he currently holds. One Citi senior executive noted the fixed-income division reported record Q2 earnings and commented, "We need to go back and see what happened but people don't turn from peacocks to feather dusters in the space of six weeks." Saudi Prince Alwaleed bin Talal, Citi's largest shareholder, said, "I'm backing the management of Citi." He called Q3 a "hiccup" and said, "... our journey with Citi will continue because we remain loyal." Separately, MarketWatch reports NYSE-listed Genpact Ltd. has bought Citigroup's India-based business process outsourcing unit for $700M, according to unnamed sources. Shares of Citigroup rose 0.3% to $47.86 on Tuesday, but gave up most of the gains in extended trading.

Sources: Bloomberg, MarketWatch I, II
Commentary: Citi Falls on Q3 Profit Warning ・Financials Rally in the Face of Analyst Cuts ・Citi to Acquire Rest of Nikko; List on Tokyo Exchange
Stocks/ETFs to watch: C, G
Earnings call transcript: Citigroup Q2 2007

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Comments

[Carpe Max:]

This interactive Knowledge Map from NewsVisual shows you the Citigroup Board of Directors' ties to third companies www.newsvisual.com/new... . With this map you can quickly and easily see the management experience that currently exists at Citigroup and provides you with a wealth of information right at your fingertips.

2007 Oct 03 11:19 AM