Citigroup on Wednesday confirmed key management and organizational changes in its corporate bank in the wake of James Dimon's departure.
Victor J. Menezes and Michael A. Carpenter, who succeeded Mr. Dimon and Deryck Maughan at the head of the corporate bank three weeks ago, issued an internal memo Friday announcing the formation of an 18-member operating committee to help oversee the unit's strategic direction.
"There is much to be done to integrate the two organizations for the benefit of our clients while maintaining the distinctive capabilities of both organizations," the new co-CEOs said in the memo, dated Nov. 13.
Integration difficulties forced Mr. Dimon's ouster and have plagued the company's wholesale operations since Citicorp merged with Travelers Group last month.
The new operating committee-which currently includes only those executives overseeing domestic business lines-had the first of its weekly meetings Tuesday in Armonk, N.Y., a Citigroup spokesman said.
The committee is expected to include members from Citigroup's foreign operations for quarterly meetings, according to the memo.
Analyst Diane Glossman of Lehman Brothers said the committee's formation shows signs of progress in what has been a thorny melding of Travelers' Salomon Smith Barney unit and Citicorp's corporate bank. "I've heard that it (the integration) is going along," she said.
The memo also outlined several personnel moves, including the appointment of Robert McCormack to a newly created job as head of risk management. Mr. McCormack was head of global relationship banking at Citicorp. He was once head of Citicorp's real estate group and oversaw the loan workouts of the early 1990s.
Citigroup spokesman John M. Morris said risk management is a "very high priority right now." Salomon Smith Barney reported a third-quarter loss of $325 million because of trading losses of more than $700 million.
Another former Citicorp executive, Alan MacDonald, will take Mr. McCormack's place as head of global relationship banking and will sit on the operating committee. Mr. MacDonald was head of global markets at Citicorp.
The memo also announced the retirement of Robert Mundheim, Salomon's general counsel, at yearend. Joan Guggenheimer will take his place.
Organizationally, Mr. Menezes and Mr. Carpenter moved the private bank back under the corporate bank umbrella. Private banking had been part of the consumer group since the first Citigroup management announcements were made last spring.
Mr. Morris said the decision to shift the business to corporate "makes more sense in aligning the distribution of products through the retail business of Smith Barney."
Even payday will not be the same. The company bumped bonus paydays back one month, to Jan. 28, 1999, according to a Nov. 11 memorandum circulated within Salomon Smith Barney. The delayed bonus payments would give Mr. Carpenter and Mr. Menezes more time "to effectively manage the compensation process," that memo said.
Among the Salomon department heads on the operating committee: Mr. Maughan, Citigroup vice chairman; Eduardo Mestre, investment banking; Jay Mendelbaum and Paul Underwood, private clients; Jorge Bermudez, cash management and trade finance; Bob DiFazio and Arthur Hyde, equities; Tom Maheras, fixed income; Bob Druskin, administration and operations; and Jim Boshart, London.
Citicorp bankers on the committee include: Dennis Martin, emerging markets; Sandra Jaffe, custody and clearing services; Shaukat Aziz, private banking; Julian Simmonds, foreign exchange and structured products; Mary Alice Taylor, operations and technology; and Charlie Scharf and John Gerspach, financial functions.