After casting around for a new leader for more than a month, Citigroup has decided that two heads are better than one.
Vikram Pandit, a newcomer who joined the company in May after it bought his hedge fund, is Citi's new chief executive, and Sir Win Bischoff, a top executive in London who has been acting chief executive, will be chairman.
The moves, announced Tuesday after a two-day board meeting, and after a search that took longer than one month to complete, come as Citigroup (nyse: C - news - people ) faces shrinking capital levels, $13 billion or more in new write-downs, and deterioration in its sizeable consumer loan portfolio--not only mortgages but auto loans and credit cards.
Late last month, the banking company got a $7.5 billion infusion of capital from Abu Dhabi's investment authority, which will help it shore up its sagging capital levels.
Still, Citi's troubles are far from over. Many analysts say it needs to take more drastic steps, including cutting its dividend or selling one of its prized assets, such as its large retail brokerage, Smith Barney. David Hendler, an analyst at CreditSights, reckons that without cutting its dividend, it would take Citi at least five years to return to its pre-subprime meltdown profitability.
Vikram Pandit, a newcomer who joined the company in May after it bought his hedge fund, is Citi's new chief executive, and Sir Win Bischoff, a top executive in London who has been acting chief executive, will be chairman.
The moves, announced Tuesday after a two-day board meeting, and after a search that took longer than one month to complete, come as Citigroup (nyse: C - news - people ) faces shrinking capital levels, $13 billion or more in new write-downs, and deterioration in its sizeable consumer loan portfolio--not only mortgages but auto loans and credit cards.
Late last month, the banking company got a $7.5 billion infusion of capital from Abu Dhabi's investment authority, which will help it shore up its sagging capital levels.
Still, Citi's troubles are far from over. Many analysts say it needs to take more drastic steps, including cutting its dividend or selling one of its prized assets, such as its large retail brokerage, Smith Barney. David Hendler, an analyst at CreditSights, reckons that without cutting its dividend, it would take Citi at least five years to return to its pre-subprime meltdown profitability.
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In the spring, the company eliminated 16,000 jobs in a global cost-cutting initiative.
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