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Citi pays departing banker US$ 42.6 million |
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Citigroup has agreed to pay departing executive Michael Klein about $42.6 million. Klein, a former investment banking head, is receiving more than the bank awarded Charles Prince, the former Citi chairman and chief executive, who retired in November as the bank prepared to post billions of dollars of write-downs. The payment is still likely to fuel political and public concern over the scale of sums paid out despite huge losses incurred by the banks. But Klein's payout comes at a cost. Under the agreement, he cannot work for, advise, or solicit clients for 12 major commercial and investment banks through October 4, 2009. He also cannot solicit or hire Citi employees during that period. He is restricted from: Barclays, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JPMorgan Chase, Lazard Ltd, Lehman Brothers, Merrill Lynch, Morgan Stanley, Royal Bank of Scotland and UBS. Klein cannot solicit clients away from Citigroup, but he can approach Citi clients to invest in alternative asset management businesses, including private equity funds.Klein said he hasn't made any decisions about this future plans. Citi said on Monday that Klein, a 23-year veteran of the firm, who most recently was chairman of its institutional clients group, was leaving. The departure is latest in a management shake-up under Vikram Pandit, who became the bank's chief executive in December. At least some details of Klein's separation agreement were outlined in a regulatory filing, where Citi said it was paying him $21.3 million in cash on March 31, 2009 and $7.5 million of cash on October 5, 2009. Klein will also receive a cash payment of $5.5 million on August 1, 2008, in connection with a deferred cash retention award granted in January, the filing said. Klein will also receive previously awarded options and shares worth about another $8.3 million.
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Citigroup Inc. (Citigroup) is a diversified global financial services holding company whose businesses provide a range of financial services to consumer and corporate customers. The Company is a bank holding company. Its segments include Global Consumer Group, Corporate and Investment Banking (CIB), Global Wealth Management and Alternative Investments (AI)./span>
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New York – Citi (NYSE: C) today announced that it has reached an agreement with the U.S. Treasury, the Federal Reserve Board, and the Federal Deposit Insurance Corp. (FDIC) on a series of steps to strengthen Citi's capital ratios, reduce risk, and increase liquidity, as described below: CAPITALThe U.S. Treasury will invest $20 billion in Citi preferred stock under the Troubled Asset Relief Program (TARP). Citi will issue an incremental $7 billion in preferred stock to the U.S. Treasury and the FDIC as payment for a government guarantee on $306 billion of securities, loans, and commitments backed by residential and... Readmore | Citigroup has announced that it will reduce staffing by another 50,000 to arond 300,000 employees. At the peak, at the end of the fourth quarter in 2007, Citigroup employed approximately 375,000 staff. It has already reduced staff by 23,000 this year. The announcement was made at a "town hall" meeting. No information was given on the presentation slides as to where the reductions would be made. The presentation stated that they would be achieved in the near term. The presentation also highlighted that expenses would be reduced by 20%.Click here to see the Cititabank presentation Readmore | Citigroup has reported its 4th quarterly loss in a row. New York, NY – Citigroup Inc. (NYSE: C) today reported a net loss for the 2008 third quarter of $2.8 billion, or $0.60 per share, based on 5,342 million shares outstanding. Results included $4.4 billion in net pre-tax write-downs in Securities and Banking (See Schedule B on page 10), $4.9 billion in net credit losses, and a $3.9 billion net charge to increase loan loss reserves.Highlights Net interest revenue up 13% and net interest margin up 79 basis points versus the third quarter 2007. Lower write-downs in Securities and Banking for... Readmore | New York – Citi (NYSE: C) today announced it has reached an agreement–in-principle to acquire all of the banking subsidiaries of Wachovia Corporation (NYSE: WB), creating the largest U.S. bank by total deposits. Wachovia will remain a public company and retain its asset management, retail brokerage, and certain select parts of its wealth management businesses, including the Evergreen and Wachovia Securities franchises. Going forward, Wachovia expects to have adequate capital to support its remaining businesses, an appropriate allocation of tangible equity, and certain tax assets that will be recognized immediately.Under the terms of the agreement-in-principle, Citi will pay Wachovia approximately... Readmore | Citigroup has agreed to pay departing executive Michael Klein about $42.6 million. Klein, a former investment banking head, is receiving more than the bank awarded Charles Prince, the former Citi chairman and chief executive, who retired in November as the bank prepared to post billions of dollars of write-downs. The payment is still likely to fuel political and public concern over the scale of sums paid out despite huge losses incurred by the banks. But Klein's payout comes at a cost. Under the agreement, he cannot work for, advise, or solicit clients for 12 major commercial and investment... Readmore | | Show options |
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Citigroup Recent Events
83% Fall in Full Year Net Income
Job Losses
Dividend Cut
Investor ConcernCitigroup announced that the 2007 Full Year Net Income was US$ 3.6 billion a fall of 83% from the previous year’s US$ 21.5 billion. The results included US$ 18.1 billion in pre-tax write-downs and credit costs on sub-prime related direct exposures and a US$ 4.1 billion increase in credit costs primarily on US consumer loans. The Group announced 17,000 job cuts globally in April 2007. In November 2007 it announced its intention for a further 4,200 reduction in staff. Following his appointment as the new CEO, Vikram Pandit has announced that he and his management team will take a thorough review of its businesses to establish if it is correctly sized. They will also focus on productivity enhancements. Already, they have started to reverse the US branch expansion plan. They will also review the risk management in the Group. Although in December 2007 the Board confirmed that it was going to maintain the dividend, alongside the Fourth Quarter and Full Year 2007 Results announcement it was confirmed that the dividend would be cut by 41%. Shareholders have also seen a 50% fall in the share price over the last 12 months and are being further diluted by the additional capital raising of US4 14.5 billion also announced with the annual results. Both investors and employees, many of whom also own stock, are distressed by the results and the subsequent consequences. There is still considerable comment regarding the estimated final compensation payments of the recently resigned Chairman and CEO, Chuck Prince, estimated to be around US$ 40 million including benefits he will retain for up to five years.
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