Citigroup (C) Goes Begging For CEO

According to the FT, the board at Citigroup (C) tried to get Josef Ackermann, the head man at DeutscheBank (DB) to come to the US bank as CEO. He said no. There appears to be no premier outside candidates who want to try to fix the Citi problem or die trying.

Citi’s board is taking much too long to make a decision that is actually no that difficult. Vikram Pandit, a talented financial company manager who used to work at Morgan Stanley (MS) and now has a senior job at Citi, seems to be ready to take the job. And, why not?

At a company the size of Citi, the CEO does not really run the company day-to-day. Senior division managers and the CFO handle most decisions, even high-level ones. The CEO is there to set policy and have drinks with big customers. Charles Prince, the former head of the bank, seemed to have trouble with the policy part, at least in the arena of risk management.

Citi is in so much trouble that the board is going to be working closely with management, at least for the next couple of quarters. They are, in essence, a CEO by committee. So, putting a talented executive from within the bank into the mix as chief is not taking much of a risk.

The risks are already baked into the bank from a series of decisions made over the last two or three years. Putting off picked a CEO only makes it worse.

Douglas A. McIntyre