Citigroup CEO Vikram Pandit steps down

A suprise exit.

Vikram Pandit steps down. Photograph: Getty Images

The chief executive of Citigroup, Vikram Pandit, has resigned a day after the group reported an 88 per cent drop in quarterly profits.

Pandit, chief executive since December 2007, has stood down with immediate effect. He will be replaced by Michael Corbat, who was previously the bank's chief for Europe, the Middle East and Africa. 

Citigroup praised Pandit for his "leadership, integrity and resilience in guiding Citi through the crisis".

President and chief operating officer, John Havens, has also resigned. The company said that Havens had been planning to retire at the end of the year but had decided to leave at the same time at Pandit.

Citigroup reported an hige quarterly drop in quarterly profits to $468m (£291m) this week, but this was mainly due to a $4.7bn charge from reducing the value of its stake in the Morgan Stanley Smith Barney joint venture that it is selling. Overall, profits were better than expected.

Pandit said in the statement, "Thanks to the dedication and sacrifice of people across Citigroup, we have emerged from the financial crisis as a strong institution. Citigroup is well-positioned for continued profitability and growth, having refocused the franchise on the basics of banking.

"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.

In August this year, Citigroup paid out $590m to settle claims it had been hiding the scale of its exposure to sub-prime mortgages - the bank has always denied the allegation but said it wanted to avoid spiralling legal costs.

This story originally appeared on economia.