Top Firm Said Likely To 'Shrink Itself' By A Third
More in BUSINESS NEWS
back-up- Top Firms Finally Hit By H1N1 Threat
- Top Firm Caught Out By Rogue Traders
- 'It's Not As If They Paid Great Bonuses In The First Place!'
- Top Firm Chain Letter
- Sisters Are Doing It For Themselves
- Dear All - 'I Am Not Interested' In Bank of America Job
- Bank of America, BNP Paribas, Goldman, JPMorgan, Galleon Group
- Old Traders Never Die - The Seance
- Click Here To Register For Free News E-Mail Alerts
- Speculation Mounts About Goldman's Bonus Plans
- Top Boss Tells Church Crowd 'Profit Is Not Satanic'
- Your Views On Bonuses (Poll Results)
- Bank of America 'Is Not A Monarchy'
- Bankers Will Have The Last Laugh On Pay
- 'There Aren't Many People Who Think Charlotte Is A Major Financial Center'
- Top Firm Delivers 'Another Big Disappointment'
- Bank Of America CEO Poll - Incredible Result
- Scruffy Civil Servant Warns Tax Dodgers
- BofA Said To Have Got Another Turn-Down
- Interview With Bernie Madoff
- Top Firm Dismisses Talk Of Further $10bn Writedown
- The Average British Soldier
- Top Firm Puts More Aside For Staff Compensation
- Firms On Alert As Insect 'Infestation' Crashes PC Networks
- Register Now For Free 'Old Traders Never Die' Updates
- Secretary Geithner's Written Testimony On Reform Of Financial System
- ISITC Europe Successfully Introduces New Operating Structure
- Dumb & Dumber - Incredible Details About Lehman Weekend Revealed
- The Cityboy Column
- The Man Bank of America Should Hire As CEO (But Won't)
- Goldman Needs To Give Away $1bn
- Top Firms Said To Have Lost $400m On Hedge Fund
- H1N1 Flu - Have You Got It ? (Quick Test)
- H1N1 Bank Call Center Transcript (You Couldn't Make It Up)
- 'It's Just No Fun Anymore!'
- Top Firm CEO Says He Won't Poach Staff From Rivals
- 'I Hate Recruitment Consultants' - Reader Comments
- Bohemian Bankruptcy
- 'I Hate Recruitment Consultants'
- Mack Attack - The Moment Big John Hit Back
- Compliance Training ? 'The Biscuits Were Good'
- Banker, Hire Thyself
- IT Recruitment - The Smart Way
- And Wall Street's Top Athlete Is...........
- John Mack On Saving Morgan Stanley
- Bankers Taught How To Be Killing Machines
- Banks Given Five More Days To Justify Bonuses
- Billionaire Madoff Investor Found Dead In Swimming Pool
- Top Bailed-Out Execs Averaged $18m Each In 2008
- The Vic Daniels Column - 26/10/09
Related Content
- Top Firm May Rein In Bonuses (19/08/2009)
- Top Firm Said To Have Got Its Timing Wrong (Again) (26/08/2009)
- Mass Defection At Once-Top Firm (13/10/2009)
- Top Firm Said To Have Scored Own Goal (19/10/2009)
- Top Firm Chain Letter (05/11/2009)
- Top Firm Said Planning Hiring Spree (20/08/2009)
According to the newspaper's unnamed sources, Citi will also soon announce 'steps to shed two consumer-finance units, (CitiFinancial and Primerica Financial Services), and the company's private-label credit-card business'. The firm will also 'substantially' cut back on prop trading over at the investment bank, as it scales back on risk.
Although CEO Vikram Pandit had hoped that he wouldn't have to break-up the empire, the extent of the financial and economic crisis, and the impact that this has had on Citi, now makes this inevitable. Bloomberg quotes Bill Smith, founder of Smith Asset Management, who said that the financial supermarket model 'was never going to work. You had three management teams that all failed to integrate this. You will not recognise this company within 12 months'.
One move that has been seen in a positive light, at least by clients, is the Smith Barney deal. Clients are expected to benefit from an improved product range and a better quality service as a result of the tie-up with Morgan Stanley. And a lot of the financial advisors themselves look likely to be happy. Not only does it look like most of their jobs are safe, but The New York Post reports that up to $3bn has been set aside for retention bonuses for key performers.
As Citi realises a $6bn post-tax gain on the deal (some $4bn will be paid over to the US government in tax), some feel that the merger is not such good news for Morgan Stanley. The Wall Street Journal's Deal Journal predicts that the deal will only cause CEO John Mack 'a big headache and an even bigger mess', as the new brokerage boss, James Gorman, 'meld(s) two distinct broker cultures, market(s) an unwieldy brand name and constantly juggle(s) the interests of his two mammoth shareholders'.
Please use the 'E-Mail' button immediately under the article title to send this item to a friend.
Please use the 'E-Mail' button immediately under the article title to send this item to a friend.











