They came from around the world, and honored him.
Brought to New York for a strategy conference late last month, Citigroup Inc. executives stationed in more than 100 countries where the megabank does business used the gathering as an opportunity to mark the retirement of William R. Rhodes, who in 53 years at Citi has built one of the most storied careers in modern international finance.
They screened a video tribute that evening featuring Paul Volcker, Henry Kissinger and other A-listers in banking and diplomacy whom Rhodes considers friends. And the assembled well-wishers, having endured one of the toughest periods in their company's 198-year history, rose together twice in standing ovations for a man intimately familiar with financial jams, restructurings of historic proportions and the overseas markets on which Citi has staked its future.
"It was very nostalgic and emotional," said Rhodes, who turns 75 in August, during an interview in the Manhattan office he is packing up this week as he makes the transition from senior vice chairman to a more informal role as a senior adviser. "I ended up mentoring and picking almost all of these people over the years."
The lucky ones might have apprenticed with Rhodes in the 1980s when he headed committees of international banks that negotiated debt-restructuring agreements for countries including Mexico and Jamaica. They might have watched him in 1998 when he hammered out a term extension that kept the Korean banking system afloat or observed him the next year as he coordinated the continuation of foreign banks' trade and interbank credit lines in Brazil.
They might have heard about the impassioned pleas he used to persuade his Citi colleagues to charge into Central and Eastern Europe as Communist regimes fell or have witnessed the work he did to help Citi reopen in South Africa after Nelson Mandela was elected president there. Some may have accompanied him on one of the 75 or so business trips he has made to China in recent years.
UNOFFICIAL STATESMAN
Jorge Bermudez, a longtime Citi banker and former head of the company's Latin American division, was working on corporate restructurings related to a Mexican debt crisis when he met Rhodes. It was 1982, and Mexico was not the only country on Rhodes' mind at the time.
"The first day I met him, I was there to talk to him about Mexico, and he was on the phone with the president of our bank in Argentina. It was during the Falklands War. That's where I began to get the globality surrounding Bill," recalled Bermudez, who retired from Citi in 2008.
"I could overhear the conversation, about the British troops, about what the Argentines were doing, about how it was affecting our operations and our people in Argentina," he said. "I began to see a very human aspect that sometimes gets lost when you're talking about the financial sector. I was a young banker at the time, and that impressed me very much."
Time and again the impression was reinforced, perhaps never so much as in the mid-1990s when Argentina fell into financial crisis. Argentine government officials asked the Treasury Department and the Federal Reserve for help, according to Bermudez, who was running Citi's operation in Argentina at the time.
"I recall this very clearly: They were told [by the Americans] that, if they wanted to be able to get out of that crisis and get financial support from the markets, then they had to engage Bill Rhodes in the process," Bermudez said. "It was a very personalized recommendation."
Other banks, both foreign and domestic, tried over the years to woo Rhodes away from Citi. So did the government. He was interviewed several times for Treasury posts and once was offered the job of under secretary for international affairs (he would not say by whom but confirmed it was not by the current administration). But Citi always seemed to be involved in places where his skills were needed and especially valued.
"I would guess that, any time he even thought about [leaving], the powers that be at the bank said, 'Please, don't,' " said former Treasury Secretary Nicholas Brady, who worked closely with Rhodes in the 1980s on the so-called Brady Plan for reducing Third World debt. "His interests were certainly of a public nature, but there was a lot of work to do at Citibank."
Rhodes built a reputation as an ace negotiator, as relentless as he is fair. He earned trust in simple ways, such as making sure that each person around the table in a debt restructuring discussion got the chance to share his or her views. "Even if they didn't want to, I would force them to do it because it had to be a consensus-type process," he said.
Without indulging a request for specific examples, Rhodes confirmed that there were times when Citi's interests were at odds with what he considered the best interests of some of the countries seeking help. At least once he was frustrated enough to consider quitting.
Quitting, however, would have meant cutting short a career with a company he joined quite by accident but soon seemed destined to help lead.
Rhodes, who was born in New York and raised on Long Island, had intended to join the military after graduating from Brown University. But a knee injury on the lacrosse field forced him to shift gears quickly and line up a private-sector job.
When he heard Citi was looking to fill posts in Latin America, he jumped at the chance.
Up until then, Rhodes had had only two brushes with Citi in Latin America. One involved failing to get a check cashed at a branch in Buenos Aires (he was not a customer at the time), and the other involved being in Brazil when a Citi branch was burned to the ground (the arson was incited by anti-American sentiment in the suicide note of embattled Brazilian leader Getulio Vargas).
Recounting those experiences made for an awkward interview with the personnel department, but Rhodes said his work ethic and desire to live abroad — he had worked on Danish cargo ships trading to Latin America for two summers during college, first as a mess boy and later as a seaman — were strong selling points in the eyes of George Moore, the executive who hired him.
VALUE OF EXPERIENCE
Rhodes spent two decades outside the U.S. working for Citi in Venezuela and the Caribbean. Walter Wriston, who led the company from 1967 to 1984, became his banking mentor. His public policy mentor was Volcker, whom he met in 1982 during what became known as the LDC (less-developed-country) Crisis, which started in Mexico and eventually encompassed more than two dozen indebted countries.
At the end of his tenure as Federal Reserve chairman, Volcker wrote a letter, one of dozens of framed mementos hanging in Rhodes' office, praising him for his work during the crisis.
"Time passes and conditions change, but that [experience] can never be taken away," Volcker observed.
Rhodes, who is fluent in Spanish and gets by in Portuguese, played central roles in negotiating debt restructurings for Brazil, Peru and Uruguay, among other countries. In 2006, he helped Iraq negotiate a debt swap with large corporate creditors. "We didn't have a big position in the debt," Rhodes said, "but we felt within the bank that it was an important thing to get done."
Less involved but no less interested in the current situation in Greece, Rhodes, who met with the Greek prime minister in January during the World Economic Forum in Davos, Switzerland, said he regrets that the European Union was unable at that point to deliver a solution.
"If the EU had gotten its act together at that time, the amount of money needed would be about one-third what it is now, and you wouldn't have had all the market volatility" that ensued, Rhodes said.
He also worries about problems at home where bulging deficits and the impact of protectionist trade policies prompted by the global recession concern him. He recently met with two key Obama administration advisers, Valerie Jarrett and Lawrence Summers, to discuss foreign trade.
"We are the flag bank for the U.S. in the international realm, and the president is pushing exports, and that's an area where we can help," Rhodes said, referring to the bank's long history in trade finance.
Despite Citi's recent troubles, Rhodes sounds sanguine in discussing the bank itself.
"I think we've turned the institution around," he said, citing the development of CEO Vikram Pandit's strategic plan, the repayment of federal bailout funds, strong profits reported for the first quarter and the continuing disposition of assets.
Those markers helped convince Rhodes that now is the "perfect time" to step down, he said.
Next week, he will relocate to a Citi office a block away from the company's Park Avenue headquarters. He is to spend the equivalent of two days a week advising Pandit. Rhodes also plans to start his own firm, William R. Rhodes Global Advisors, to help American companies with their work overseas. He is to remain involved in many of the international finance organizations he has served over the years, and he hopes to devote more time to the international economics and finance center named for him at his alma mater, Brown.
Barbara Stallings, the William R. Rhodes Research Professor at the school's Watson Center for International Studies, which houses the Rhodes Center, said she hopes his retirement will let him visit the school more often.
"He has always been ready to provide resources for important projects and to help us bring international leaders to campus so that students and faculty can gain a better understanding of how the world works," Stallings wrote in an e-mail sent from Korea, where she is spending the semester. "He has also been extraordinarily helpful to me in my own research by opening doors for me to meet with key financial officials in various countries."
STRATEGIC LEGACY
Ironically, it is just as Rhodes is stepping down that Citi is promoting its international reach with new vigor. Pandit last month rechristened the company as "America's global bank" and touted its ability to capitalize on overseas markets where the economy has been healing faster than in the U.S.
But it is a strategy that will be pursued without someone of Rhodes' stature.
"With 53 years of experience? With the background he has? Citi has no one inside that could take his place in that role," said Bermudez, who as a Citi shareholder and former banker is concerned about the void Rhodes leaves. "When you look at what's happening with Greece and the potential contagion effects it might have in other countries, I do think the world needs a person like Bill."
But Rhodes is confident the company will get by, and he champions its strategy for doing so. "What we're trying to do is put more authority in the field," he said. "I think that's the future of international banking."
Rhodes said he wants Citi's country heads to play bigger roles in the markets where they live and work. It would make Citi look more as it did back when he was hired. "You became really embedded in the country" where you work, he said, and tours of duty were lengthier than they have been in recent years.
A more decentralized approach also is favored by many of the countries were Citi operates. Local authorities "are insisting on that now," Rhodes said.
"They want the people in the field to be able to commit" when important decisions need to be made quickly.
Citi's current crop of international executives has two advantages in that regard. First is the mentoring that Rhodes has given much of the group during the past five decades. Then there is the good will that Citi has built up in important overseas markets such as China, where it established operations in 1902.
"We're not, as we say in Spanish, recien llegados — recently arrived — and people remember that," Rhodes said.
Indeed, there is something about longevity that inspires appreciation and, when well executed, admiration.
