An imagined future memo from Citigroup’s CEO
Suppose it is 2011 and the Volcker Act has recently passed, sharply curtailing U.S. banks’ riskier activities and separating them from retail deposits. Citi‘s recently arrived chief executive Bob Steel, who is dismantling the group, puts out a memo to the bank’s staff saying Tim Geithner has been hired as head of the bank’s strategy and investor relations. Oddly, the imaginary scenario is not such a stretch.
From: Bob Steel
To: All Citi staff
Feb. 1, 2011
Dear Citi employee,
By now, most of you probably know that Citi announced the appointment of Timothy F. Geithner as Global Head of Strategy and Investor Relations. Tim, who joins after a hiatus from a distinguished career in public service, will report directly to me.
In his new role, Tim will oversee Citi’s relations with shareholders, including the U.S. government and key investors in the Gulf Region. He will work closely with me, as well as Vice Chairman Christopher Dodd and Executive Vice President of Government Relations Harry Reid to manage the increasingly challenging regulatory environment presented by the implementation of the Volcker Act.
As you all know, we are now focused on developing our client franchise in our core business as we proceed with the series of dramatic changes announced in recent months to the corporate organization of the group. Under Tim’s leadership, we will reinforce the confidence we have begun to rebuild with shareholders as we embark on the biggest restructuring of Citi’s capital structure since its founding.
Tim is an exceptional communicator and strategic thinker. His track record shows consistent results under some of the most challenging financial conditions in generations. Our new model — a smaller, more focused global bank for businesses with no consumer operations and a trading arm devoted entirely to facilitating client transactions — is one Tim understands from his years in public service, both at the Federal Reserve Bank of New York and as Secretary of the Treasury from 2009 until 2010.
Until suitable replacements are named, I have asked Tim to oversee all of our investor relations responsibilities, including those for Citi’s two pending spinoffs: the planned divestiture of Citi’s North America Consumer Banking franchise to a consortium led by Banco Itau of Brazil and Carlos ‘Slim’ Helu; and the creation of Toxia, America’s biggest non-bank financial institution, through the merger of Citi Holdings and General Electric Capital’s GE Money division.
I hope you are all as excited as I am about Tim’s arrival and the great future that lies ahead for the corporation. I am looking eagerly to taking your questions in the various Town Hall meetings that our new Head of Corporate Communications David Axelrod will be setting up at Citi locations around the globe in coming weeks.