Downfall

Krawcheck to leave Citi

Jim Kim — Mon, 22 Sep 2008 21:07:44 -0400

You could have guessed this was coming. Once the mythic "most powerful woman on Wall Street," Sallie Krawcheck, the head of Citi's wealth management unit, has taken some lumps as of late. Now comes news that she will leave the bank. The New York Times notes the move is part of yet another management shake up. Michael Corbat is expected to assume Krawcheck's role. Her downfall can perhaps be linked back to the reign of Charles Prince, who tapped her as CFO. She did not fare well and ended up back in wealth management. There have been rumors that she would leave for a while now. All in all, it has been a rough road for women at the top. Not so long ago, Zoe Cruz, Erin Callan and Krawchek all had bright careers ahead.

For more:
- here's the article

Pandit's hedge fund not faring well

Fri, 16 May 2008 06:59:58 -0400

The news that Citigroup will essentially wind down Old Lane, the hedge fund firm that Citigroup bought for $800 million, may stand as an omen. The fund--which was started by Vikram Pandit, who now heads the bank--has been a turkey for investors. Forbes notes that the fund fell 4 percent. In 2007, it was up only 2.8 percent, net of fees. Citigroup now is allowing investors to exit the fund. Most will take them up on the offer. But employees must stay invested until 2011. The article calls the fund an "odd stew" of investments. Its ultimate downfall seems to be the result of the credit crunch. Its big bet on collateralized debt obligations did not fare well. Certainly, Old Lane added to the hedge fund woes at Citigroup. You can't help but think that these grapes will sour even more if Pandit cannot turn the company around.

For more:
- here's the Forbes article

Cayne sells stake in Bear Stearns for a pittance

Fri, 28 Mar 2008 07:59:58 -0400

Jimmy Cayne, ex-CEO of Bear Stearns, has taken a huge hit. His holdings in Bear Stearns were worth more than $1 billion a year ago. The New York Times reports he just sold his entire stake for just $61 million. Ouch! This seems to be symbolic more more than anything, and a capitulation. Obviously, he holds out very little hope that a higher bid will emerge--either that, or he doesn't care. His downfall will long be remembered on Wall Street, as will that memorable page one Wall Street Journal article that recounted his pot-smoking tendencies. He's still a wealthy man, but this is a bitter end to a colorful career. Many at Bear place the blame on him. You have to wonder what his mentor, Ace Greenberg, is thinking.

For more:
- here's the New York Times article

Related Articles:
Bear Stearns execs cashed out in December. Article
Bear Stearns execs pay in harsh spotlight. Article
The future of Bear Stearns. Article
Cayne joins rogues list. Article
Open season on Cayne? A pot smoker? Article