|
Some analysts speculated the bank may place less emphasis on Wall Street trading and helping companies sell stocks and bonds to the public, the so-called investment banking in which Pandit had expertise. The business is volatile, with blockbuster profits occasionally followed by big losses. Instead, the focus could shift to commercial banking, what Daniel Alpert, managing partner of Westwood Capital, calls the "dull and boring" businesses of lending to companies and consumers. Dick Bove, a bank analyst at Rochdale Securities, thinks Citi will not only emphasize commercial banking, but will shift focus more overseas where the bank faces fewer rivals and could charge higher interest rates. "If you look at domestic commercial banking, you have lower interest rates, you have higher losses, you have regulation and a high degree of competition," he said. "If you go overseas, you don't have any of those. You have tremendous growth." Citi manages 200 million accounts with customers in 160 countries. Corbat also spoke to analysts on the conference call but, as was the case with O'Neill, gave little indication how Citi might change. Corbat has worked at Citi and its predecessors since he graduated from Harvard in 1983. Pandit's resignation came a day after the bank announced what many analysts had hailed as terrific earnings for the third quarter. "It feels very abrupt to us," one analyst, Mike Mayo of CLSA, said on the conference call. "We're all scratching our heads, and thinking,
'What just happened?'" O'Neill replied, "What happened is Vikram submitted his resignation." Pandit is credited with not only slimming the bank, but removing it from government ownership after the bailout and righting its balance sheet after billions in losses on bad mortgage investments made before he took the helm. But he came under criticism for not cutting expenses enough last year. "You're in a recovery mode, and the last thing you should do is make investments that retard that," said Second Curve's Brown of the bank's 2011 investments overseas and in branches. "Last year was terrible." Said Cassidy: "I don't know if (Pandit) was pushed out or quit, but I don't think he was following the game plan of O'Neill."
[Associated
Press;
Copyright 2012 The Associated
Press. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
News | Sports | Business | Rural Review | Teaching & Learning | Home and Family | Tourism | Obituaries
Community |
Perspectives
|
Law & Courts |
Leisure Time
|
Spiritual Life |
Health & Fitness |
Teen Scene
Calendar
|
Letters to the Editor