Story updated with comments from the Chairman and new CEO from analyst call.
A Citigroup conference call with Chairman Michael E. O'Neill and newly minted CEO Michael Corbat late Tuesday did little to squash the conspiracy theories behind Pandit's exit.
According to a Wall Street Journal report, the CEO resigned over clashes with the board over strategy and performance, a day after the bank reported a purportedly good quarter .Vikram Pandit has denied that there were any clashes on pay or strategy with the board and told CNBC's Maria Bartiromo that the departure was his decision. And in the analyst conference call, Chairman Mike O' Neill and newly- appointed CEO Mike Corbat stuck to the script. O'Neill said no strategic, operation or regulatory issue precipitated the resignation, nor was it a result of any ethical misconduct. He said that the board had been planning a successor to Pandit for two years and that Corbat was at the center of the process. Corbat added that the management change "does not reflect any desire to alter the strategic direction of Citigroup, which we believe to be the right one." When CLSA analyst Mike Mayo asked O' Neill if the reason for Pandit's departure was over pay, the chairman said "Categorically, no. Vikram offered his resignation and the board accepted it." But not everyone is buying it.
So, to sum up the Citi call, Citi is totally fine & won't change a thing, but Vikram decided to resign overnight & we said cool. $C— Mark Gongloff (@markgongloff) October 16, 2012
"Vikram submitted his letter of resignation and we accepted it." $C Chairman Mike O'Neil on conf call when asked: Why change CEO now?— Adam Johnson (@AJInsight) October 16, 2012
DIM BULB: How one says that a CEO who presided over a Co w/ a stock price down 89% during his/her tenure did a "good job" is beyond me. $C— Legacy Trades (@Legacy_Trades) October 16, 2012Also, while critics have complained that Pandit should have stayed on to manage the company's transition to a new CEO, O'Neill said the timing was "fortuitous." Corbat takes over at a time when the bank is going through three critical processes- budget planning, updating a three-year plan and submitting a request for capital approval with the Fed. It was critical that he be part of the process and set targets in order to be held accountable in the future, O'Neill said. Given the timing of his takeover then, it would not be too presumptuous to assume that there will be changes.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV