Huffpost Business

Citigroup Nominates 4 Directors

Posted: Updated:

NEW YORK — Citigroup has nominated four new independent directors _ including two former bank chief executives and two other financial experts _ to stand for election at its annual meeting in April.

The announcement Monday comes as part of an ongoing shuffling of the troubled bank's board. Its shares climbed more than 30 percent.

Investors have long criticized Citigroup's board for allowing the bank to make so many investments in the risky housing market _ actions that have led to the bank reporting five straight quarterly losses.

Richard Parsons, who took over as chairman last month, has said he planned to look for people with proven business judgment and experience in the financial sector to replace retiring directors overseeing the company.

The board currently has 15 directors, three of whom previously announced they will not stand for re-election and two of whom will be of retirement age by the time of the shareholder meeting.

The candidates are Jerry A. Grundhofer, Michael E. O'Neill, Anthony M. Santomero, and William S. Thompson Jr.

Grundhofer, 64, is chairman emeritus and former chairman and CEO of U.S. Bancorp; O'Neill, 62, is former chairman and CEO of Bank of Hawaii; Santomero, 62, most recently served as a senior adviser at McKinsey & Co. and is the former president of the Federal Reserve Bank of Philadelphia; and Thompson, 63, is the former CEO of bond investment manager Pimco.

With the election of the four candidates, Citigroup would have a total of 14 board members. The bank says the board also will consider future additions.

Parsons, the former head of Time Warner Inc., is one of the few Citigroup directors with experience in both banking and leading a large company. Before joining Time Warner in 1995, Parsons served as chairman and CEO of Dime Bancorp Inc., one of the largest U.S. thrift institutions. Parsons also was an economic adviser on President Barack Obama's transition team.

The three directors who have already announced they will depart from the board are Roberto Hernandez Ramirez, the chairman of Citi's Mexican banking operations; Robert Rubin, a former Treasury Secretary who was a longtime Citigroup board member; and Win Bischoff, most recently chairman at Citigroup. Ramirez said he will not stay on the board beyond his current term, while both Rubin and Bischoff have announced their retirement from the bank.

After suffering a loss of $8.29 billion in the fourth quarter, Citigroup announced it would reorganize into two units, Citicorp and Citi Holdings. The first will focus on traditional banking, while the second will hold the company's riskier assets and tougher-to-manage ventures. In addition to receiving billions in government support, plus federal guarantees to cover losses on risky investments, the New York-based bank has agreed with the Treasury Department on a deal giving the government up to a 36 percent stake.

Its shares rose 58 cents, or 32.6 percent, to $2.36 in midday trading but are still only a fraction of their 52-week high of $27.35.