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Citigroup appoints a new COO charged to slash costs
CITIGROUP yesterday promoted Robert Druskin to chief operating officer and told him to cut costs at the world's largest financial-services company.
Druskin's job will be to "make sure we have the most efficient and effective operations in the business," Chief Executive Officer Charles Prince said yesterday.
Citigroup's operating costs rose 13 percent in the first nine months of this year, Bloomberg news reported yesterday.
Druskin, 59, will remain head of the corporate and investment banking unit, and join Prince and former United States Treasury Secretary Robert Rubin in the chairman's office.
Prince is under pressure to increase Citigroup's stock price as shareholders, including Saudi Prince Alwaleed bin Talal, demand that he take steps to revive earnings growth.
Speculation mounted last week that New York-based Citigroup would break itself up or that Chief Financial Officer Sallie Krawcheck would leave, suggestions Prince dismissed as baseless.
"The market is looking for a lot of things at Citi, one of them was a spinoff of the businesses," said Anton Schutz, president of Mendon Capital Advisors, who manages US$270 million and doesn't own Citigroup shares.
"The market was looking for a whole lot more" than Druskin's promotion, he said.
Prince ruled out a breakup and said no more changes were planned.
Shares trail
Citigroup's stock rose US$1.03 yesterday to US$52.88 in New York Stock Exchange composite trading before the management change was announced.
Shares of Citigroup are up 9 percent this year, trailing the 20 percent advance of JPMorgan Chase & Co and Bank of America's 14 percent gain.
Druskin has previously served as Prince's deputy, and helped former CEO Sanford Weill integrate many of the more than 100 acquisitions that went into building Citigroup, Schutz said.
Druskin will be Citigroup's first COO since Robert Willumstad resigned in July 2005.
Citigroup's 5 percent increase in revenue was outpaced operating costs, which swelled to US$38.1 billion in the first nine months of 2006.
chinajob This entry was posted on December 13th, 2006 at 08:49:10 am by ChinaJob and is filed under News of China.