Who will lift the Citi poisoned chalice? Politicians from militarist regimes move out of favour – Hank Paulson and Shaukat Aziz, please step down from the podium.
Mr Vikram Pandit moves one step up the shortlist.
Pandit is the obvious candidate. Before the defenestration of the Prince formerly known as CEO even happened, Pandit’s stock was on the rise. He came to Citi from Morgan Stanley, via Old Lane Partners – a hedge fund he co-founded.
Alas, as Financial News tartly points out, Old Lane “hasn’t enjoyed the same kind of success” as its sire.
Citi bought Old Lane for $800m in April, but the fund has badly underperformed. It lost money in November, reports Financial News, down about 1 per cent. And returns for the year are thin too, averaging just 3 per cent, compared to a 10 per cent hedge fund average. Old Lane’s own internal goal was to hit annual returns of between 10 and 15 per cent, according to an Old Lane investor.
Of course, the big thing Citi have gained from Old Lane, is Pandit. So why don’t they make good on their investment?
Old Lane was bought by Citi to jump-start the bank’s alternative-investment businesses, which had been without a CEO for a year. What a parallel. Maybe Vikram could jump start the business, full stop.
Hat tip to Fintag, who also relays gossip that Pandit is slated to appear on Oprah.