Banks
Citi Shake-Up Could Signal Asset Sales
04/01/08 - 06:59 AM EDT
Citigroup'sC decision to separate its consumer credit card and retail banking arms could be a first sign that the beleaguered banking titan is preparing to undertake a long-called-for paring of its business. The New York-based bank, soiled by securities writedowns and forced to take billions in provisions for mortgage loan losses, formally announced Monday a new corporate organizational structure in which its business lines will be combined and reported by geographic location. The company is also splitting its consumer banking and credit card divisions into two separate units. Proponents of the changes say that they will enable CEO Vikram Pandit to get a better grip on improving performance at some of the more troubled areas of the firm, notably its credit card and retail banking businesses, after years of underperformance. And while Citi declined to comment on speculation, it's possible that Pandit could also be paving the way for an eventual sale or spinoff of one or more individual businesses, as the changes break Citi into more manageable pieces.
News You Need: Citigroup, JPMorgan Chase |
The reshuffling is part of a larger organizational shuffling by CEO Vikram Pandit.
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