Vikram Pandit, the chief executive of Citigroup, abruptly ended his five-year tenure with the bank following a clash with the board over strategy and performance.
In a decision that stunned the Wall Street, Pandit's resignation is largely attributed to a series of missteps the bank has taken recently including its failure to win a Federal Reserve's acceptance of its capital plans.
He will be replaced by Michael Corbat who previously served as Citigroup's CEO of Europe, Middle East and Africa.
"Vikram Pandit has stepped down as the Company's Chief Executive Officer and as a member of the Board, effective immediately," the company said in a statement. "The Board also announced it has unanimously elected Michael Corbat CEO and a director of the Board."
Pandit, who led the bank throughout the period of financial slowdown, managed to avert a collapse with the help of a $45 billion rescue package provided by regulators, taxpayers and Congress. He agreed to receive $1 in compensation in 2010 when he said he would not take more until the bank returns to profitability.
"Given the progress we have made in the last few years, I have concluded that now is the right time for someone else to take the helm at Citigroup. I could not be leaving the Company in better hands," Pandit said. "Mike is the right person to tackle the difficult challenges ahead, with a 29-year record of achievement and leadership at this Company. I will truly miss the wonderful people throughout this organization. But I know that together with Mike they will continue to build on the progress we have made."
"We respect Vikram's decision. Since his appointment at the start of the financial crisis until the present time, Vikram has restructured and recapitalized the Company, strengthened our global franchise and re-focused the business," Chairman of the Citigroup Board of Directors Michael E. O'Neil said. "The Board and I are grateful to Vikram for his leadership, integrity and resilience in guiding Citi through the crisis and positioning it well for the future. We wish him all the best with the next stage in his career."
Board members were reportedly of the opinion that it's time for a change in leadership as the company's shares dropped 89 percent over Pandit's tenure and the regulators, shareholders and board members were growing increasingly sceptical of his performance of late.
