The board of Citigroup paid its former chief executive Vikram S. Pandit $6.65 million. He unexpectedly resigned last month. The amount was said to be part of an incentive package for his work during 2012. He will also receive his deferred stock and cash awards from 2011 that was valued to be around more than $8.8 million.
Pandit resigned in October and it was said that his departure was planned by the bank’s board. Citigroup’s Chairman Michael E. O’Neill got the support of other directors in order to oust Pandit. Michael L. Corbat was named Citigroup’s new chief executive.
As part of the company’s revamp, the board also forced chief operating officer John Havens to resign. He will get $6.8 million in incentive pay for 2012 as well as deferred cash and stock awards that were valued at $8.725 million.
Pandit was the head of Citigroup during the most turbulent part of its history. He became CEO in 2007 and managed the bank through the financial crisis. The bank’s financial health was so dire that he chose to get $1 annual salary to help the bank.
Citigroup managed to return to profitability but it has struggled with stagnant stock price as well as lackluster earnings. It got a tough blow in March when the Federal Reserve rejected its plans to increase its dividend.
Since Pandit’s resignation from Citigroup, some of the senior executives’ mood became grim. They felt that the board’s actions last month were humiliating to Pandit. They should have been thankful to the former CEO for his role in reviving the bank instead of forcing him out of the company.
