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TheStreet Open House

Pandit Resigns in Citigroup Shakeup

Stocks in this article: C

Updated with comments from former Citigroup CEO Vikram Pandit, from an interview by Bloomberg.

NEW YORK ( TheStreet) -- Citigroup (C - Get Report) on Tuesday announced that CEO Vikram Pandit had already resigned from his position, and from his seat on the company's board of directors.

The board of directors also announced that it had "elected Michael Corbat CEO and a director of the Board," after previously serving as the company's CEO of Europe, Middle East and Africa.

Pandit said that after leaving Citi "well-positioned for continued profitability and growth, having refocused the franchise on the basics of banking," he had "concluded that now is the right time for someone else to take the helm at Citigroup." Pandit also said that he "could not be leaving the Company in better hands. Mike is the right person to tackle the difficult challenges ahead, with a 29-year record of achievement and leadership at this Company."

Citi also announced that its president and chief operating officer John Havens had resigned. Havens also served as CEO of the company's Institutional Clients Group, and according to the company "said that he had already been planning retirement from Citi at year-end but decided, in light of Mr. Pandit's resignation, to leave the Company at this time."

Pandit and Havens both joined Citigroup in 2007, when the company purchased Old Lane LLC. Pandit became Citigroup's CEO in December 2007.

Pandit guided Citigroup through the credit crisis, including the company's participation in the Troubled Assets Relief Program, or TARP, debt guarantees from the Federal Deposit Insurance Corp., the conversion of the TARP preferred shares held by the government to common shares, and the trimming of the company's balance sheets, through his long-term "good bank/bad bank" strategy of placing runoff assets within the Citi Holdings subsidiary.

Citigroup on Monday reported third-quarter earnings of $468 million, or 15 cents a share, declining from 95 cents during the second quarter, and $1.23 during the third quarter of 2012.

The third-quarter results included a $4.7 billion pre-tax loss on the company's sale of a 14% stake in the Morgan Stanley Smith Barney joint venture, and the write-down of its remaining stake in the joint venture, as well as a negative $776 million in debit valuation adjustments, as well as a $582 million tax benefit. Excluding these items, the company earned $3.3 billion, or $1.06 a share during the third quarter, beating the consensus estimate of 96 cents a share, among analysts polled by Thomson Reuters.

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