Citigroup CEO Charles Prince 57, retired under pressure on Sunday. He said it was "the only honorable course for me to take." Former Treasury secretary Robert Rubin, a board member and chairman of the company's executive committee, will serve as chairman of the board. Sir Win Bischoff, chairman of Citi Europe, will serve as acting CEO, the company said.In business circles, former CEO Sandy Weill was a rock star. But Prince, well, Prince was a lawyer.
Citigroup (C) also is lowering the value of some of its securities tied to subprime mortgages. It estimates the value of those securities, at fair market value today, would be $8 billion to $11 billion less than it expected just Sept. 30. That write-down would be in addition to a $6.5 billion write-down it has already taken. The company also said a special unit has been set up to handle the subprime mortgage problems. Citi said it has no plans to reduce its dividend.Merrill Lynch (MER) CEO Stanley O'Neal was pushed into retirement last week following the worst quarterly loss in his firm's history.
UBS, (UBS) the Swiss banking giant, deposed its CEO Peter Wuffli last summer after it had to shut a hedge fund that invested in mortgage-backed securities.
Bear Stearns (BSC) CEO James Cayne barely survived the implosion of two hedge funds this summer by firing a number of his firm's top executives, including the co-president.
Other executives who have been tarnished by the collapse of the subprime mortgage industry and the evaporation of value in derivative securities built on subprime mortgages or other risky investing strategies include Countrywide Financial's Angelo Mozilo and Bank of America's (BAC) Kenneth Lewis.
0 Comments