Pandit, Deputies Buy Citigroup Shares After Plunge

Pandit, Deputies Buy Citigroup Shares After Plunge


Nov. 14 (Bloomberg) -- Citigroup Inc. Chief Executive Officer Vikram Pandit and three deputies bought a total of 1.3 million shares in the U.S. bank yesterday in a show of confidence after the stock fell below $9 for the first time in 12 years.

Pandit, 51, bought 750,000 common shares, paying an average of about $9.25 apiece, Citigroup said in a filing with the U.S. Securities and Exchange Commission. He also bought 100,000 preferred shares. In all, he spent about $8.4 million.

John Havens, 52, head of the New York-based bank's trading and investment-banking division, bought 250,000 shares, a person with knowledge of the matter said. Trading chief James Forese, 45, bought 200,000 and Chief Risk Officer Brian Leach bought 100,000, according to the person, who declined to be identified because the company hasn't disclosed the purchases.

Citigroup, the fourth-biggest U.S. bank by market value, has tumbled 16 percent this week in New York trading and is down almost 70 percent this year, after four straight quarterly losses totaling $20 billion. The company's board yesterday was forced to issue a statement in support of Chairman Win Bischoff after the Wall Street Journal reported that some directors were frustrated by the company's performance and considering replacing him.

The shares were up 25 cents at $9.70 in German trading after dropping 2 percent yesterday on the New York Stock Exchange. Citigroup was the only loser on the day among the 24 companies in the KBW Bank Index, which gained 6.6 percent.

Job Cuts

Citigroup may report a fourth-quarter loss of $2.85 billion, Oppenheimer & Co. analyst Meredith Whitney estimated in an Oct. 21 report to clients.

The mounting losses have led Citigroup to slash jobs. The company started notifying staff members last week who are affected by the bank's plan to eliminate 9,100 positions over the next 12 months, or about 2.6 percent of its headcount.

Job reductions may accelerate with the goal of lowering the global headcount to about 290,000 from 352,000 at the end of September, the Journal reported earlier today, citing an unidentified person familiar with the matter.

Financial firms worldwide have axed more than 155,000 jobs since 2007, when U.S. subprime mortgage defaults sparked the global credit crunch, according to data compiled by Bloomberg.

To stem losses, Citigroup also is increasing interest rates for some credit-card customers by 3 percentage points, the Journal reported.

BLOOMBERG