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  • Citigroup Just Blew It [View article]
    Josh, from what I heard Pandit was fired over a few things: 1) The MSSB JV made MS a bunch of money and lost Citi tons. Moreover, C is still trying expedite their exit from the JV. As I understand this was the last straw. 2) Pandit had too global a view of the bank and wasn't aggressive enough in closing business lines that weren't producing (eastern europe). Cutting costs is a priority for Chairman O'Neill, who made a name for himself doing just that as the chief of Bank of Hawaii. 3) Pandit bungled the request to the Fed for returning capital to shareholders after CCAR 2012.

    P.S. Pandit and Havens (former COO) were partners at Old Lane Partners (hedge fund) and came to Citi after selling their fund for an exorbitant amount just before the crisis. They received their sale proceeds over a 3 year vesting period. If memory serves correct the prop desk bought the fund, and ironically it's probably sitting in Holdings today.
    Mar 12 01:09 AM | Likes Like |Link to Comment
  • Citigroup Just Blew It [View article]
    Joe, do you think Corbat & Co view Citi as a growth stock, as opposed to a value stock? If so, I think we likely won't see a significant dividend increase until Citi gets north of $60.

    For pre-crisis long term investors, significantly raising the dividend now would be akin to washing a car that doesn't start: it'll look more attractive, but the tangible value is minimal at best. Lets get the stock higher before returning a bunch of capital.
    Mar 12 12:59 AM | Likes Like |Link to Comment
  • Expect gradual, but not outsized jumps in capital returns from the banks this year, says Goldman (stress tests results are due Thursday, capital return decisions due March 14). Management teams are likely to be conservative in their requests from the Fed as "taking a mulligan" - i.e., resubmitting a plan after being shot down - is not seen as a viable option. [View news story]
    I think buybacks are the way to go right now. Modest dividend increases aren't going to help long and upside-down investors much.
    Mar 5 05:37 AM | Likes Like |Link to Comment
  • Banks Might Be A Good Buy, Citi Is A Great One [View article]
    @TommyB0y. $8B buyback was part of Pandit's capital plan submitted to the Fed -- it was rejected. Pandit was outed by the Chairman because primarily because of the failed capital plan and the loser deal concerning the MSSB joint venture.

    This year Corbat has signaled he's going to make a bit more conservative request: "minimal" buyback with no raising of the dividend.
    Feb 17 08:57 PM | Likes Like |Link to Comment