Despite the ongoing speculation at the international level that Citigroup is speeding up the process to dismantle various parts of the banking behemoth and shrink the company by one-third, the bank?s newly appointed chief executive officer (India operations), Mark Robinson, succeeding Sanjay Nayyar, will be taking over on February 1, 2009.
Meanwhile, the bank is involved in the process of restructuring its consumer finance business in India, after having seen a huge chunk of bad loans in the portfolio.
The spokesperson still maintained, as said earlier, that there would not be any changes in the overall functioning of the bank.
The bank is relocating some of its branches in certain geographical areas, which includes clubbing two branches into one and enhancing the product portfolio of the consumer finance business.
Vikram Pandit-led Citi has been in the eye of a financial storm in the wake of credit crisis, forcing the US Federal government to throw two lifelines worth over $45 bln to the company.
The New York Times quoting two persons with the knowledge of the plan reported that the Citi is planning to split itself into two, under pressure from Washington and Wall Street.
Citi, scheduled to report its quarterly results next week, is widely expected to post a $10 billion operating loss for the fourth quarter.
Quoting people familiar with the bank, The Wall Street Journal said the banking behemoth would soon announce a plan to shed a host of businesses and ?shrink itself by one-third.?
?Citi will soon announce a drastic plan to shed a host of businesses and shrink itself by one-third, say people familiar with the bank, which its executives say will essentially dismantle the financial colossus built by legendary deal maker Sanford Weill,? the report noted.
On Wednesday, Citi said it would split Smith Barney retail brokerage into a joint venture with Morgan Stanley.
?Citigroup will also announce steps to shed two consumer-finance units and the company?s private-label credit-card business, and scale back on the trading the company does on its own behalf,? the Wall Street Journal said.
According to the report, the moves would represent the final abandonment of the acquisition-fueled growth strategy that built Citigroup from a small consumer-finance business into one of the world?s largest financial institutions, with over 3,00,000 employees in more than 100 countries.
Meanwhile, the New York Times reported that Citi?s plan to accelerate dismantling of its ?financial supermarket? comes after a stern regulatory warning in November 2008.
Attributing to one of the people briefed on the discussions, the report said the warning ?was delivered by Sheila C Bair, the chairwoman of the Federal Deposit Insurance Corporation, who told Citigroup, that any further requests for cash would result in a breakup of its operations dictated by regulators.?
Citigroup will soon announce what its executives describe as a drastic plan to shed a host of businesses and shrink itself by one-third, a leading financial daily said on Wednesday, citing people familiar with the bank.