It’s an unhealthy sign for the U.S. economy that the most fascinating, if not divisive, player on the financial stage is the head of the Federal Deposit Insurance Corporation. But such is the case with Sheila Bair.
Although there is mounting evidence that the worst of the banking crisis may have passed, Bair continues to command center stage. The latest, if the unnamed sources chatting to the Wall Street Journal are to be believed, is that Bair wants to shake up top management at Citigroup. Presumably this would include the ouster of Citi’s chief executive, Vikram Pandit.
To be sure, Pandit would rank high on anyone’s list of “CEOs most likely not to make it to 2010.”
The Obama White House has mulled pushing out Pandit, but has hesitated to pull the trigger reportedly because of a lack of a compelling successor. And one could certainly make the argument that because of both moral hazard and governance issues, troubled banks should see management decapitated if forced to seek government support.