In the comments to my post on Chuck Prince’s resignation, somebody with the very creative handle “Anonymous” makes an excellent point:
You may recall that Prince got the job when Citi was reeling from one legal scandal after another, which was not a Weill forte. If the trend continues, the next CEO will be good at sorting out subprime mess but inept at whatever skill sets the next crisis demands.
Which sent me looking back to a 2002 NYT article on Prince:
Charles O. Prince III is amused by his image as the chief problem solver at Citigroup.
That description, from people like Sanford I. Weill, the chief executive, ”has a kind of Bob Vila feel to it,” said Mr. Prince, referring to the handyman television host.
Over the last week, though, Mr. Prince, appointed by Mr. Weill on Sept. 8 to head Citigroup’s investment bank, Salomon Smith Barney, has lived up to the fix-it reputation.
He has met with state and federal regulators, hoping to devise a speedy solution to the multiple investigations into Salomon’s business practices. Officials briefed on the meetings said Salomon offered a sweeping settlement proposal that could include separating its investment banking and research departments to avoid conflicts of interest.
And last Monday, Mr. Prince announced that Salomon would pay $5 million to the NASD to settle an investigation into Salomon’s research on Winstar Communications, a onetime telecommunications highflier.
Mr. Prince’s appointment came as Salomon was immersed in lawsuits and government inquiries arising from its financing of Enron and now-ailing telecommunications companies like WorldCom. Some of those deals occurred under Mr. Prince’s predecessor, Michael A. Carpenter, who was reassigned.
The aggressive effort to repair the damage shows the imprint of Mr. Prince, a workaholic lawyer known for his sense of humor and, more important, his loyalty to Mr. Weill.
”Citigroup put Chuck Prince in charge for a reason,” said Michael Mayo, an analyst at Prudential Financial. ”We’re getting a sense of what his mandate will be.”
If Mr. Prince succeeds, analysts say, he could be Citigroup’s next chief executive. If he fails, Mr. Prince said, with characteristic bluntness, ”I’m out of a job.” …
Update: Maria Bartiromo is reporting on CNBC that Saudi Prince Alwaleed bin Talal, Citi’s biggest shareholder, wants Sandy Weill to come back as interim CEO. But Sandy tells CNBC he doesn’t want that, although “I am here to help.”
Update 2: Prince AbT may be looking for the wrong savior. Jeff Matthews says it’s all really Sandy’s fault, after all (via Abnormal Returns):
… I think if Citigroup’s shareholders and its board of directors and Wall Street’s Finest are looking for someone to blame, they might study a little more carefully the history of this patchwork of insurance companies, brokerage firms, and banks called “Citigroup,” and ask themselves whether they’ve dethroned the right man.
From the longer view, this looks more like the latest incarnation of the age-old public company shell game in which some fair-haired CEO convinces naive shareholders, gullible analysts and complacent board members that a kabillion dollar company can consistently outgrow the very market it serves quarter-by-quarter-by-quarter …until it can’t.