NPR logo Citigroup Charts New Course After Prince Resigns


Citigroup Charts New Course After Prince Resigns

Citigroup is charting its future after the resignation of Chairman and CEO Charles Prince.

Prince resigned Sunday after Citibank announced huge losses stemming from investments in subprime mortgages.

In the third quarter, it already took a hit of $6.5 billion in asset markdowns and other credit-related losses. On Monday, it revised down its results for that quarter by $166 million, after correcting the value of the company's exposure to complex instruments called collateralized debt obligations.

The nation's largest bank is estimating additional losses of up to $11 billion.

Citigroup also revised its exposure to collateralized debt obligations, or CDOs, to $43 billion.

Analysts and investors said Prince failed in his strategy to remake Citigroup into a "universal bank" that pulls in revenue from all kinds of financial services.

Former Treasury Secretary Robert Rubin will be chairing the bank. Sir Win Bischoff, chairman of Citi Europe and a member of the Citi management and operating committees, will serve as interim CEO.

Prince is the second Wall Street chief executive within a week to lose his job. Last week, Stanley O'Neal, who was the CEO of Merrill Lynch, resigned after the company reported losses of more than $8 billion.

From NPR reports and The Associated Press

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