Citigroup and Vikram Pandit

Pray as you go

It was a surprise when Vikram Pandit became Citigroup’s chief executive and a surprise when he left

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Readers' comments



skepticji in reply to J. Kemp

Are you suggesting Mr. Pandit was merely glib while his board and predecessors were smart thoughtful visionaries? Mr. Pandit did not cause the mess. He inherited a mess. Meanwhile the regulators were busy drinking the kool-aid supplied by the then CEOs of the investment and commercial banks.


Isn't this a WASP thing.

They just used someone to fix the hard bits. Not much that can go wrong from here, so does make sense to get rid of him.

Mr Pandit stepped in when Citi was too toxic for anyone. People at that time had no idea whom they can trust to fix things. Atleast thats how it seemed. No one seemed sure who had the capacity to understand the breadth and depth of the mess Citi found itself in and who can methodically and painstakingly work through the mess given the focus it would take to navigate the Banking environment at that time.

He was not grabbing the reigns when the quarterly incomes started being reported routinely in billions again. Unlike these wise gentlemen of banking who are grabbing the headlines today, when he stepped in the almost-quarterly government bailouts ran into tens of billions, not quarterly profits.

I don't blame O'Neill or Corbat for swooping in when the time was right. With very little on the downside, maybe the time has come to split the bounty and/or hog the limelight. And i don't blame Mr Pandit for calling it quits. He probably felt his job was already done, nothing else mattered to him so let the wasps swarm.


Mr. Pandit did a terrible job. He never got to the core of gutting out the rotten bits of Citi's toxic stuff. His strategy was to stall and wait for the market to right itself so that his worthless mortgages could be worth something. C never bought another bank at deep deep discounts -- this would have helped Citi's bottom line. Wachovia was offered to him for $2B with government guarantees(!) but he took too long and Wells Fargo swooped in and bought it for $15B (its loan book alone was worth $350B on paper and Mr. Pandit had to think about it!!! he was a hedge fund guy... really?).

Sorry, I think he was indeed the worse CEO around.

J. Kemp in reply to skepticji

So you suggest that Mr. Pandit was a victim?

Mr. Pandit did/does not have the background which one would expect to be most effective in running an organization like Citicorp. The notion that a Morgan Stanley banker, turned hedge fund operator, should then be the obvious guy to run Citicorp makes no sense whatsoever.

Citicorp is a vastly different type of business than those where Mr. Pandit did his learning.

J. Kemp

The phenomenon of glib, charming, and reasonably bright opportunists rising in organizations (and in politics), while separating their host organizations from their money -- and leaving lots of damage in their wakes -- is not a rare one in business or government. The phenomenon of these individuals turning out to not be as qualified in practice when put to the test of fulfilling the top job is also not uncommon.

Boards of directors of companies, and electorates need to learn about the phenomenon of the charming opportunist who smoothly finds his way to the top job. One should vet candidates out based on their history of making boring marches down the relevant learning curves, and their demonstrated effectiveness in getting similar jobs done -- not their superficial charm and wit -- and not their carefully collected pedigree of name-brand credentials from various institutions and organizations which they similarly charmed along the way.


A general rule is that when a person starts a new job their strengths shine. As time goes their weaknesses become apparent and may even dominate.

Also lots of people find that, unless they belong to a union, every few years they need to change jobs because of human dynamics.


Capt Sanjay

The article presents a one sided picture and does not bode well for otherwise good reputation of unbaised reporting by The Economist. As would be apparent from most of the reactions to the article, the author has failed to give the man his due.

Pandit remains one of the key industry leaders in the financial world and is destined for bigger roles.


It would be nice to have a look at 2nd chart ( before judging the performance. Look at the most important 2 measures effectiveness (profitability) and efficiency (number of people). These are much better for Citi than any other bank. So it is ineffective argument based on the share price alone to say that work was not done.
I wish to share a story - when Columbus first discovered America - at the dinner hosted to celebrate his accomplishment many started saying that they could also have done the same. So he gently suggested that it would nice for any one of them to show him how to make a boiled egg stand upright on one of its ends. Nobody had a clue. Then he took a boiled egg, gently tapped the end where it had an air pocket - the shell broke & egg stood upright. Then everybody understood the message & kept quiet.
If there were so many wise & capable people were around - then he should not have been handed over the job - that was a failure of the board. Then board should be fired along with him. If the board had recognized they made a mistake - they couldn't have persisted with the mistake for 5 years. That also means board & the chairman were ineffective.


An absolutely boring read. really nothing that was not told in the first fifteen minutes of his resignation. Wonder if Economist still has any analytical abilities. Pandit was made to head a firm, that was aleady declared too bog "to fail". Today, no one doubts this "going" concern. ML is gone, so is Lehman. AIG, GM, we all know the story. And lets remember, that Pandit was never given a free hand. Sheila Bair was around then, and so were the regulators. How come the inefficient firms kept going with their CEO compensation, while Pandit was the chosen one not to be paid. Sounds ludicrous. The real analysis would say how was the quality of earnings projected then by the same analysts, and how were they projected now. Were the risks mentioned in their notes more scary then the ones now? The rest, based on stock prices, is primitive.


But was it a surprise when he left with an enormous windfall after doing essentially nothing vis a vis stock price for his investors?

The more things know the rest-

skepticji in reply to J. Kemp

Nope, he is not a victim. Merely pointing out that singling him out makes no sense. The folks on the Board who appointed him presumably were experienced bankers and who knew what it took to run an organization like Citicorp. Or, perhaps they deliberately chose someone who was different from the classic past Citi CEOs such as Weil because they no longer had faith in that kind of skill set?

chanakkya74 in reply to Daveycool

I hope you know what you are talking about. Wonder how many people were lining up to buy C's toxic stuff? And buying Wachovia? Give me a break- anyone with any understanding of business would say that when you are downhill, you consolidate. Simple. Citi became what it is today because there were too many hedge fund managers busy acquiring assets to grow.I agree he was a Citi misfit.

chanakkya74 in reply to J. Kemp

I am surprised it is so easy the way you describe. Is the place full of dumbs? Than some one like Pandit could easily walk through? If I remember it right, it was so critical then to get the right man, that it took of time deciding on Pandit. It was at precipice. Today, they decide in minutes the new CEO. The situation obviously is not that precarious. But people who have all their lives enjoyed on borrowed money and and never taken risks will find it "charming their way up"!



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