Citigroup Inc named investment bank chief John Havens president and chief operating officer on Wednesday, expanding its most senior level of executives and elevating a long-time friend of Chief Executive Officer Vikram Pandit.
Havens, currently head of Citigroup's institutional clients group, will fill a vacant role as he takes charge of the bank's day-to-day operations. The company announced his promotion along with several other management changes on Wednesday.
Citigroup's investment bank has struggled recently, falling to eighth place from fourth in Thomson Reuters' rankings of the high-profit mergers and acquisitions business. Citigroup announced it was promoting Havens a day after the company reported a worse-than-expected fourth-quarter profit, due largely to a steep drop in the investment bank's bond-trading revenue.
After years at Morgan Stanley together, Havens and Pandit left to form the Old Lane hedge fund in 2005. Citigroup bought the fund for $800 million in 2007, and by the end of that year had named Pandit CEO.
Havens was the most highly paid Citigroup executive in 2009, earning about $9.5 million in compensation, and he was on track to repeat that status in 2010. The bank said in a September filing it would give him $750,000 in common shares per month, or about $9 million for 2010.
In the announcement, Pandit called Havens indispensable to the turnaround of Citi, which was forced to take $45 billion in government bailout funds during the financial crisis.
This new management structure will serve the company well as we aim to enter into a new phase of responsible and sustained growth, Pandit said in the release.
Citigroup also promoted James Forese, who oversees the investment bank's trading operations as co-head of global markets, to CEO of its securities and banking unit. The bank promoted Vice Chairman Ned Kelly to chairman of the institutional clients group. Forese, Kelly and Global Transaction Services CEO Francesco Vanni d'Archirafi will all report to Havens.
Pandit also said in an internal memo that Citigroup would replace the executive and senior leadership committees with an operating committee managed by Havens and a business development committee managed by Kelly. Pandit will chair both committees.
Citigroup's shares rose 4 cents at $4.84 in early New York Stock Exchange trading.
(Reporting by Maria Aspan; Editing by Lisa Von Ahn and Maureen Bavdek)