Mayo Says 'Sell Citi'

Deutsche Bank analyst Mike Mayo slashed his rating on Citigroup(C Quote) to sell after the bank's latest executive shakeup.

Late Thursday, Citi named Vikram Pandit CEO of its Institutional Clients Group -- a newly formed unit encompassing Citi's Markets & Banking and Alternative Investments businesses. Thomas Maheras, a 23-year veteran of Citi and the co-chief executive of its Markets & Banking businesses, is leaving the firm to pursue other interests, Citi said. He will be replaced by James Forese, the current head of Global Equities.

The management changes come less than two weeks after Citi announced that third-quarter earnings would plummet 60% from a year ago, due largely to a $3.3 billion hit tied to writedowns in mortgage securities and leveraged buyout debt. But Mayo wasn't impressed by Thursday's moves, arguing that the shakeup didn't go far enough.

"Citi's new management moves leaves the Office of the Chairman intact despite performance that has repeatedly fallen short of peers and certain of their operating targets," Mayo writes in a note. He cut his 12-month price target by $16 to $44.

Citi shares fell 44 cents Friday to $47.88.

Mayo, like others, has been calling for the replacement of Prince in light of the company's poor performance when compared to other large-cap banks, such as Bank of America (BAC Quote) and J.P. Morgan (JPM Quote). Prince has been under fire for more than a year to boost performance, with some observers suggesting the bank be split up.