Citi Halts Severance Payments to Ex-Execs

Five former top executives at Citigroup have been told the bank won't pay them tens of millions of dollars in promised severance payouts, a report says.

Author:: Joseph Woelfel
Publish date:: Jun 2, 2009 1:09 AM EDT

Five former top executives of

Citigroup

have been told the bank won't pay them tens of millions of dollars in promised severance payouts, a report says.

The affected executives include Michael Klein, who was co-head of Citigroup's investment bank, and Kevin Kessinger, formerly in charge of operations and technology at the bank, the

Wall Street Journal

reports, citing people familiar with the matter. Klein and Kessinger both received lucrative severance packages when they left last year, including periodic cash payments, the

Journal

notes.

Company officials at Citigroup, which already has given out more than half of the roughly $100 million it promised to the former executives, recently decided not to proceed with the remaining payments, the newspaper reports. Bank officials concluded they wanted to avoid even the possibility of a public backlash over the money.

Citigroup has received $50 billion in money from the U.S. government, which will soon own as much as 34% of the bank's common shares. Bank officials have told the Treasury Department on their plans to halt the severance-related payments. Government officials didn't demand that the bank end its payouts, according to a person familiar with the discussions, the

Journal

reports.