The latest management upheaval at Citigroup Inc. surely was intended to mark the beginning of the end of an extremely uncertain period, and in some ways it did that.

For those seeking the executive team that could put the company on the road to recovery, Citi beefed up talent Thursday, particularly when it comes to running the U.S. banking business. It promoted Edward "Ned" Kelly 3rd to vice chairman and hired industry veteran Eugene M. McQuade to run the commercial bank.

But the moves also sparked conflicting speculation about their roles, particularly Kelly's, and complicated the succession picture, analysts said. And given reports of Federal Deposit Insurance Corp. pressure to shake up management, many outsiders could not help but wonder whether the shuffle was good business or something to please the government.

"Hopefully this is more than volatility," said Marshall Front, the chairman of Front Barnett Associates Inc., a Chicago investment firm that owns Citi shares. "Hopefully they are getting their act together and putting together a viable team. They still have a lot of work to do."

Turnover has become familiar at Citi, where 60% of the $2 trillion-asset company's top executives from 2006 are no longer there. Controller and chief accounting officer James Gerspach, by succeeding Kelly as chief financial officer, becomes the fifth executive to hold that post in the past five years.

A Citi spokesman said he would not discuss specific reasons for the changes and that company executives would not be available to comment. Citi said in a press release that Kelly, 56, would "work closely" with CEO Vikram Pandit "to drive the execution of Citi's strategic and operational priorities," which primarily comprise the unwinding of noncore assets and efforts to improve core operating businesses grouped into a unit known as Citicorp.

Kelly, a lawyer turned investment banker and a former CEO of Mercantile Bankshares in Baltimore, joined Citi in February 2008 and became its CFO just four months ago when the widely admired Gary Crittenden was made chairman of Citi Holdings, a repository for noncore assets the company is seeking to sell or wind down.

Citigroup said Thursday that Crittenden had left and would move to Utah for family reasons. Huntsman Gay Global Capital LLC, a California private-equity firm, later said he would become a managing director in its Salt Lake City office.

Stuart Plesser, an analyst at the Standard & Poor's equity research division, said the extent of the government's hand in the changes was unclear.

It is possible that Citi or regulators decided Kelly's talents should be used more broadly, he said. "Are they thinking he's more useful outside of the trenches?" he said in an interview. "I don't understand that really, but it's obviously a very complex and tough job, and maybe they're thinking his vision is put to better use outside of that."

Front, the investor, said he did not see the changes as a positive for Kelly, who is seen by outsiders as a logical successor to Pandit if bigger changes come. Front said it seemed as though Kelly had reverted to a role he had held before becoming CFO — and "suddenly he has a competitor with a lot of experience," in McQuade.

Frank Barkocy, the director of research at Mendon Capital Advisors, disagreed. "I don't see it as a diminished role" for Kelly, he said. "I think the strategic area … takes on greater importance as we move forward with this company."

Citi's ranks have swelled this year with former top bank executives.

McQuade, 60, was the president and chief operating officer of FleetBoston Financial Corp. when it was sold to Bank of America Corp. in 2004.

After a stint at Freddie Mac, where he was considered the heir apparent for the CEO post, he joined Merrill Lynch & Co. in February 2008 only to leave after the investment bank was sold to B of A.

This year Citi added the former U.S. Bancorp chief executive Jerry Grundhofer and former Bank of Hawaii Corp. CEO Michael O'Neill to its board.

Jason Goldberg, an analyst at Barclays PLC's Barclays Capital, wrote in a note to clients that the recent additions "bring significant experience" to the company. McQuade, in particular, "has an extensive banking background, something regulators have said Citi's management has lacked."

The FDIC has reportedly been keen on Citi's making changes, and weeks ago reports surfaced that Sheila Bair, the agency's chairman, was concerned about top executives' level of commercial banking experience.

"They've been in the penalty box because they really couldn't take on additional businesses," Front said. "Hopefully, over time, McQuade will help strengthen and unify the Citibank business and participate in some other decisions on divestitures and allocations of capital."

Plesser said that Citi must continue to focus on shrinking rather than growing, duties that appear to have been handed over to Kelly. "They've got to start to sell [their bad assets] and move them off the balance sheet," he said. "They can't sit there forever."

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