Dimon, reached yesterday at his office, said he could not comment on his resignation. Reed, former head of Citicorp, has gone through a series of lieutenants there.ĭimon's departure "seems to suggest an eventual succession issue," said Judah Kraushaar, bank analyst at Merrill Lynch & Co.Īlthough Dimon and Weill have clashed on and off over the years, Dimon was widely regarded in the banking community as the person likely to become the chairman of Citigroup after Weill, 65, and Reed, 59, retired. Harder to dispel, however, are questions the management shake-up raises about whether the company's co-chairmen and co-chief executives, Weill and Reed, have the ability to groom their successors. Citigroup officials deny anything so violent occurred. Tensions between Citigroup employees has run so high that rumors have circulated that in recent weeks a fistfight broke out between a top manager who had come from Salomon Smith Barney and another who had come from Citibank. It comes just a couple weeks after the president was ousted at BankAmerica Corp., the newly merged institution that combined Bank of America of San Francisco with NationsBank of Charlotte. The Citigroup shake-up is the latest example of the problems of trying to merge giant companies, which often have distinct characters in general and very large egos among top management in particular. "He was thoughtful and always willing to spend time explaining."Ĭitigroup's stock fell as much as 4.7 percent yesterday before recovering to close down 87.5 cents at $46.25. "We all wanted to hate him, but he turned out to be a real quality guy," said a Salomon investment banker. Yesterday, when Dimon walked onto the Salomon Smith Barney trading floor, nearly 1,000 traders stood up and gave him a standing ovation. In the end, Dimon resigned and Maughan was stripped of most of his management duties. Reed warned Dimon, 42, and Maughan, 50, to work out their differences or face a loss of power. Sources said Weill and co-chairman and co-chief executive John S. Several sources said that Dimon's relationship with Deryck Maughan, his co-chief executive at Salomon Smith Barney, the Travelers securities arm, deteriorated in recent months as Travelers digested its 1997 acquisition of Salomon Brothers. This is a man who is tremendously respected."ĭimon has spent 17 years as the right-hand man to Citigroup co-chief executive Sanford I. "I went through mourning, denial, all that stuff. "I was shocked, followed by terror about his resignation," said Sally Krawcheck, an analyst at Sanford C. But sources said that tensions between employees from Citibank and from Travelers' investment banking firm, Salomon Smith Barney Inc., have so far hindered an effective melding of those activities. The merger was touted as a way to create a company that could offer one-stop shopping for individuals and companies seeking banking, insurance and securities brokerage services. that created Citigroup, the nation's largest financial services firm, analysts and banking industry executives said. 8 merger of Citicorp and Travelers Group Inc. between risk-taking securities traders and more bureaucratic-minded commercial bankers led to the announced departure of company President Jamie Dimon this weekend and a major management reshuffling, sources close to the company said yesterday.ĭimon's resignation, scheduled to take place in two weeks, is the freshest sign of problems in the Oct. By Kathleen Day Ianthe Jeanne Dugan November 3, 1998Ī growing culture clash at Citigroup Inc.
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