Financial services company, Citigroup Inc. (C) has announced that their CEO, Vikram Pandit has stepped down from his position. It is speculated that a clash with the board of directors caused the unexpected resignation.
Citigroup’s CEO Vikram Pandit shocked Wall Street on Tuesday morning, announcing that both he and second top executive, COO John Havens are stepping down. Pandit has also renounced his seat in the board of directors for the company.
Pandit’s replacement will be Michael Corbat, who is the current CEO of Citigroup’s Europe, Middle East, and Africa division. Corbat joined Citigroup back in 1983, after graduating from Harvard.
The news came as a shock to the financial industry. Pandit had pulled the company through the 2008 financial crisis, and is recognized for helping the bank by selling businesses and displacing it from government ownership after the 2008 bailout. After billions of losses on bad mortgage investments, Pandit successfully corrected the company’s balance sheet.
Although the company had no comment on why two of their top executives were resigning from their positions, Pandit stated, “now is the right time for someone else to take the helm at Citigroup” after the bank “…emerged from the financial crisis as a strong institution.” Later reports noted that the sudden resignation was likely caused by disagreement within the board of directors.
Pandit joined the company when the hedge fund that he founded was acquired by the bank in 2007, and he became the CEO in December of 2007.
Citigroup shares were up 45 cents, or 1.23% Tuesday morning.
The Bottom Line
Shares of Citigroup (C) have a .11% dividend yield, based on last night’s closing stock price of $36.66. The stock has technical support in the $32-$34 price area. If the shares can firm up, we see overhead resistance around the $38-$40 price levels.
Citigroup Inc. (C) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.0 out of 5 stars.