Citigroup boss walks away with £45m deal

Click to follow
The Independent Online

Charles "Chuck" Prince – the former chief executive of Citigroup who resigned after the bank reported losses of more than $11bn (£5.3bn) on the back of the sub-prime mortgage crisis earlier this month – is to walk away from the company with more than $95m (£45m) in cash and shares at the end of the year.

Mr Prince is to receive around $42m in stock and cash bonuses and pension payments to add to the $53m in Citigroup stock that he already owns. The $42m comprises around $29m in vested stock options, some $1.43m in pension payments, as well as somewhere in the region of $12m in a deferred 2006 incentive payment, which will be based on shareholder return in 2007.

Almost $50bn has been wiped off the market value of Citigroup, the world's largest bank, since it announced its record losses at the start of the month, as its shares suffered eight days of consecutive falls.

Mr Prince's $42m final pay-off is considerably less than Merrill Lynch's former chief executive, Stan O'Neal received, who carried away more than $160m when he was ousted from his job on similar grounds to Mr Prince at the end of last month.

Although Mr Prince has now officially resigned, he is set to stay with the company until the end of the year, advising chairman Robert Rubin, and acting chief executive Sir Win Bischoff. He will be entitled to an office, secretary, car and driver for the next five years.

Pressure was yesterday mounting on John Mack, the chief executive of Morgan Stanley, which revealed losses of $3.7bn on the back of the sub-prime crisis on Wednesday. Senior sources in the bank suggested that Zoe Cruz, the company's head of trading and banking, was the front runner to take over from Mr Mack if he left.

Ms Cruz, 52, is deemed to be the most powerful woman on Wall Street, which has earned her the nickname "Cruz missile". Mr Mack's contract runs until 2010.