What Vikram Pandit's Exit at Citigroup Says About the Future of Big Banks
Friday, October 19, 2012
The sudden departure of Citigroup CEO Vikram Pandit has sparked a conversation about where the bank is headed under new leadership and what it says about the so-called "too big to fail" banking behemoths.
The bank’s immense size was causing problems even before the financial crisis. Even after slimming down considerably during Pandit’s five-year tenure, it’s still the third largest in the country by assets.
The contrast between Pandit and the new chief executive Mark Corbat could not be more stark. Pandit was an outsider who took over Citi five months after the bank acquired his hedge fund Old Lane Partners LP in 2007.
An investment banker by trade, he was never comfortable with the prospect of breaking up Citi's vast holdings, according to the Wall Street Journal.
By contrast, Corbat is a company man and commercial banker who earned kudos and a promotion for shedding hundreds of billions of Citi's unwanted assets, a project he said would remain paramount as the bank moves forward.
This week on WNYC's Money Talking, contributors Rana Foroohar of Time magazine and Joe Nocera of The New York Times weigh in on whether the leadership shift at Citi signals a return to what might be termed "boring old banking."
Plus, why Jamie Dimon of JPMorgan Chase and Lloyd Blankfein of Goldman Sachs are the only two heads of big banks and major Wall Street firms that remain in power following the financial crisis.