The embattled CEO spoke at an annual meeting that stretched to roughly six hours, where he and lead director Richard Parsons fielded complaints from investors furious about the 94 percent plunge in their shares since the beginning of 2007.
Your board of directors are too terrible for words -- they're dumb, said Peggy McMahon, who later told Reuters the declining value of her Citi shares resulted in a $250,000 loss.
Citigroup's annual meeting typically lasts hours, but this one was unusually long. The proceedings are usually dominated by small shareholders angry over their experience in retail branches or with their credit cards, but this year investors focused squarely on who was to blame for the dwindling value of their shares.
Even amid the anger, shareholders elected every director the board nominated, including some accused of lax oversight as the bank's troubles mushroomed. Investors managing money for institutions often do not attend shareholder meetings but usually dominate the voting.
Every shareholder proposal failed to pass, but some came close to winning, including one that would allow investors to call special shareholder meetings, which received a little less than half the votes cast.
Citigroup's annual meeting came four days after the bank posted a $1.59 billion first-quarter profit before payments of preferred dividends under the U.S. Treasury Department's Troubled Asset Relief Program. The results benefited from a big accounting change and improved trading results. Citigroup had lost $37.5 billion in the prior five quarters.
SEE THIS THROUGH
Pandit's job security has long been a topic of speculation, and the Financial Times on Tuesday said top Federal Deposit Insurance Corp officials have discussed who might replace him if the bank needs more government aid. It said new Chief Financial Officer Edward Ned Kelly could be a candidate.
I intend to see this through, Pandit told shareholders. Asked why Kelly handled Citigroup's conference call with analysts to discuss quarterly results, Pandit said it was only fair to let Kelly deliver the good news.
Pandit stood by Kelly's comments on Friday that the bank does not plan to change terms of an exchange offer to swap preferred shares for common, giving the government a potential 36 percent stake in Citigroup.
He also said he wants to restore the bank's dividend as soon as possible, and said Citigroup, whose shares fell below $1 early last month, was not actively considering a reverse stock split.
U.S. regulators are slated in early May to complete stress tests to determine how well the nation's largest lenders would fare if the recession proves to be deep and long. Those tests may also decide whether Citi needs more aid.
Chairman Richard Parsons said at Tuesday's meeting that working with regulators on the test is the bank's top focus.
At the meeting, Citigroup shareholders voted to install four new directors, including former U.S. Bancorp
They also reelected directors C. Michael Armstrong, John Deutch and Alain Belda despite opposition from shareholder adviser RiskMetrics Group Inc
Armstrong and Deutch have been audit committee members, and Belda is a former lead director.
Citigroup's board now has 14 members, down from 15. Of the five who left, two retired and three chose not to run for reelection, including former senior adviser and U.S. Treasury Secretary Robert Rubin, who came in for particular derision from some shareholders.
Citigroup shares rose 30 cents, or 10.2 percent, to $3.24 on the New York Stock Exchange, outperforming the KBW Banks index <.BKX>, which was climbed 8.1 percent. Shares of Citigroup traded above $56 as recently as early 2007.
By the end of the meeting, an auditorium that once held hundreds of investors had just a handful of people inside. But Russell Forenza, a resident of Ridgewood, New Jersey, who had complained about Citigroup's performance and management vociferously over a series of questions, ended on a conciliatory note.
You gentlemen put up with me, and I had to put up with you guys ... I appreciate who you are, Forenza said.
(Writing by Christian Plumb and Jonathan Stempel; Additional reporting by Elinor Comlay; Editing by John Wallace, Tim Dobbyn, Gary Hill and Steve Orlofsky)