Straws in the Wind 11-3-07
And Another One Bites the Dust!
In a special meeting tomorrow (Sunday) Citigroup's board of directors is expected to fire the bank's CEO, Charles O. Prince. Prince will follow Stanley O'Neal Merrill Lynch's CEO who was fired last week in the middle of the subprime mortgage fiasco. More losses are expected at both Merrill and Citigroup which has the greatest exposure to supprime mortgage SIVs (structured investment vehicles) of any bank with nearly $100 billion. Citigroup recently announced a $5.9 billion write-off as a result of it's involvement in subprime mortgage loans and SIVs. Further losses are likely to be in store as the bank's books are scrutinized in year in its year-end audit
Bye, Bye Charles O. Prince III, Hello Robert Rubin
Charles O.Prince was replaced by Citigroup's board of directors today, and Robert Rubin, Bill Clinton's Secretary of the Treasury was named to replace him.
$8-11 billion in writeoffs will be taken in addition to the $5.9 billion announced early in October.
It will be interesting to see whether Citigroup stock will take another hit tomorrow.
The NYT breaking news article is linked below.