Vikram Pandit, Citigroup Inc’s ousted chief executive officer, will get about US$6.7 million in compensation this year and will forfeit some awards tied to a US$40 million retention package granted last year.
John Havens, who resigned last month as Citigroup’s chief operating officer on the same day as Pandit, will get about US$6.8 million for this year and also forfeit some awards, the New York-based lender said yesterday in a regulatory filing. Citigroup is the third-largest US bank by assets.
“Based on the progress this year through the date of separation, the board determined that an incentive award for their work in 2012 was appropriate and equitable,” chairman Michael O’Neill said in the filing. “While Citi will also honor all past awards that they are legally entitled to, there are no severance payments. Awards to which they are not legally entitled have been forfeited.”
Citigroup directors led by O’Neill are managing the fallout from the ouster of Pandit, 55, and Havens, 56, last month after they spent about five years running the bank. The board forced out Pandit after concluding that he mismanaged operations and damaged the lender’s credibility, a person familiar with the matter said at the time.
Pandit and Havens will also keep a combined US$17.6 million in deferred stock and cash awards that are part of previous annual packages, according to the filing.
The US$6.7 million adds to the US$56 million Pandit received from Citigroup in annual compensation packages, including some stock awards that have declined in value. The lender paid Pandit US$165 million when it bought his Old Lane Partners LP hedge fund in 2007 in a deal that led to him becoming CEO.
Pandit replaced Charles “Chuck” Prince, who was ousted in the face of mounting losses tied to subprime mortgages. Citigroup took a US$45 billion bailout in 2008 and lost US$27.7 billion that year. Pandit accepted a US$1 annual salary for much of 2009 and 2010 until the bank returned to profitability and repaid taxpayers.
Havens, who founded Old Lane with Pandit, received US$165 million from that deal, filings show. Citigroup gave Havens annual compensation packages of at least US$33.8 million for 2009, 2010 and last year, including stock awards. The bank did not disclose his compensation for the two preceding years.
Pandit’s lost payouts include awards tied to a US$40 million multi-year retention plan awarded last year, according to the filing.
Pandit will forfeit about US$24 million in awards, according to a person with direct knowledge of the situation. Havens will give up about US$19 million, said the person, who declined to be identified because the figures are not public.