More inside bailout detail from Sheila Bair's new book.
U.S. Treasury Secretary Timothy F. Geithner resisted Sheila Bair’s efforts to replace Vikram Pandit as chief executive officer of Citigroup Inc. in early 2009, according to her memoir of the financial crisis. Pandit was “handpicked” to be CEO by former Citigroup Chairman and ex-Treasury Secretary Robert Rubin, who is Geithner’s “mentor and hero,” Bair wrote in “Bull by the Horns.” That bond was probably the reason why Geithner warded off her attempts to replace Pandit, she said.
“I assumed that was because of his relationship with Bob Rubin,” Bair said today in an interview following an appearance on Bloomberg Television. “Vikram had gotten his job with Bob Rubin’s support. There was a close working relationship there that troubled me.”
Bair, 58, who stepped down last year as chairman of the Federal Deposit Insurance Corp., sought to replace Pandit with Jerry Grundhofer, a Citigroup (C) director and ex-CEO of U.S. Bancorp (USB), according to the book.
“I had been pushing hard for Grundhofer to replace Pandit, and I believe Jerry would have stepped in if Tim had asked him to,” Bair wrote. “But Tim would not take decisive action to replace Bob Rubin’s handpicked choice for CEO, Vikram Pandit.”
Sheila Bair Reuters interview, Sep. 27:
Here's what we've learned so far from Bair's book:
- Citigroup and Merrill were both insolvent.
- Bair wanted Volcker for Treasury Secretary.
- Geithner loves Citigroup.
- Blankfein wasn't playing team ball until Bair called Buffet to complain.