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Citigroup CEO Vikram Pandit.JONATHAN ERNST/Reuters

This morning's surprise is a whopper: Vikram Pandit, the chief executive of Citigroup Inc., has stepped down, effective immediately. His successor is Michael Corbat, who headed the bank's operations in Europe, the Middle East and Africa.

Timing
Today's announcement has blindsided investors and Citi employees alike. Just two months ago, the Wall Street Journal reported that Mr. Pandit had told colleagues he planned to stay in his post for several more years.

His resignation comes a day after Citi reported better-than-expected results for the third quarter, so it doesn't appear to be a case of an executive falling on his sword. According to various reports, Mr. Pandit had clashed with the board over the bank's strategy and performance.

Mr. Pandit, 55, wrote in a note to the bank's employees that "given the progress we have made in the last few years, I have concluded that now is the right time for someone else to take the helm at Citigroup." He added: "I could not be leaving the Company in better hands."

That's unlikely to mollify investors, who were rattled by the sheer shock of the announcement. Jim Cramer, the prominent CNBC commentator, referred to Citi's quarterly results on Monday in a tweet: "Pandit leaving after a terrific Q – very worrisome."

Tenure
Mr. Pandit was one of only three Wall Street CEOs who piloted their firms through the financial crisis and still remained at the helm (the other two are Lloyd Blankfein of Goldman Sachs Group Inc. and Jamie Dimon of J.P. Morgan Chase & Co.).

During the crisis, Citi nearly foundered and had to seek a government bailout. Mr. Pandit managed to return the bank to profitability and U.S. taxpayers cashed out their stake for a $12-billion (U.S.) profit.

Still, Citi's stock is down nearly 90 per cent since Mr. Pandit took the reins in December 2007, just months before the financial cataclysm hit.

The new guy
Mr. Corbat, 52, is a long-time veteran of the bank and a one-time Harvard football player .

He won praise for his handling of Citi Holdings, the unit housing the bank's unwanted and toxic assets, according to the Wall Street Journal.

His career began at Salomon Brothers, the storied Wall Street firm known for its macho, hard-charging culture. Mr. Corbat joined Citi in 1998 when it merged with Salomon's parent company.

In a memo to Citi employees, Mr. Corbat praised his predecessor but warned that the bank faced a "challenging and dynamic environment." He said he would spend several weeks immersing himself in its sprawling businesses and reviewing reporting structures. "These assessments will result in some changes," he said.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 27/03/24 6:40pm EDT.

SymbolName% changeLast
C-N
Citigroup Inc
+1.77%62.75
GS-N
Goldman Sachs Group
+2.23%415.25

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