Having grown up in New York, we were all introduced to the ATM through Citibank, its retail presence was so ubiquitous that it sometimes dominated four corners of major midtown intersections with branch offices. Because of its ATM branch network, came the motto, "The Citi Never Sleeps," because you could make deposits and withdraw funds 24 hours a day. That was quite an innovation at the time. John Reed, a banker, seemed to articulate a clear vision of where the bank was going: grow nationally and expand its significant presence internationally.
In walks deal-maker Sandy Weill, who I believe coined the term, "financial supermarket" in relation to the new Citi. The clash of personalities and cultures resulted in the cobbled together mess that became Citicorp, which became the Retail Bank and the Investment Bank.
Now ironically, the Wall Street Journal writes,
"Over the past decade, Citi has had a deal-maker, a lawyer and an investment banker in charge. It's high time a seasoned banker was given the chance to tie it all together."Citi still has a premier global commercial and personal banking franchise, with a strong brand in Asia, despite the problems at home. Their credit cards in Asia represent a large opportunity. The investment bank, like those owned by a number of other international banks like Société Générale or Nomura, has never found a footing among Wall Street's top players. No CEO is going to change this, especially a banker.
Since all the problem assets are in Citi Holdings, it seems as if Citi eventually returns to the franchise it had before John Reed was ousted in favor of deal-maker Sandy Weill. Decades of value destruction, and we might go back from where we came.