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The ouster of Vikram Pandit, and what that means for big banks.
Finance & Accounting
Pages 4 (1004 words)
Name Course Name Instructor Date The Ouster of Vikram Pandit, and What That Means For Big Banks Citi bank is a global, diversified company offering a wide range of financial services and products to consumers, institutions, corporations, and government. The unexpected resignation of Vikram Pandit, the Citigroup Chief Executive Officer (CEO), alongside John Havens, Citi COO, is a major factor that will influence Citigroup, as well as the US general banking industry.
This paper will address Pandit’s ouster, and describe how this major event in Citigroup will influence the future operations of Citibank, as well as other banks in the same industry. Mr. Pandit took over as the bank’s CEO in 2007 when the bank was in a financial turmoil, but slightly recovered the profitability of the bank in 2010. Under Pandit’s management, much of Citi’s resources were devoted for future profitability. Expanding market to the developing countries was a prospective Pandit held (David, Suzanne, and Dan 1-2). The reasons offered for Pandit’s ouster emanate from struggles to recover from past financial crises at the bank. Mr. Pandit was forced to resign after the board of Directors at Citi bank felt that he managed the bank poorly. The board also claimed lack of appropriate communication from the CEO on vital business matters. During the tenure of Pandit, the shares of Citigroup fell by 89%, which resulted in a revolt by shareholders over his executive pay. The Federal Reserve also rejected Citigroup’s plan to purchase back stock. In addition, there was a $2.9 million write-down by Morgan Stanley, of a brokerage joint venture. ...
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