Feds May Fire Another CEO (Citigroup); Credit Suisse Upset Over Too Much State Intervention

Are you getting scared yet America?

Citigroup CEO Vikram Pandit’s job security is increasingly in jeopardy as momentum grows in Washington to oust him.

With the bank stress tests wrapping up, sources tell The Post that regulators think they might have to make the bold move of removing Pandit to signal Washington is taking as hard a line with the banks as it did with General Motors when it effectively ousted GM CEO Rick Wagoner.

The talk of Pandit being dismissed comes amid speculation that a visit to Citi’s offices by Treasury Secretary Timothy Geithner a week and a half ago might have been to discuss a change at the bank’s helm. However, people familiar with the meeting said the visit was simply to conduct a checkup on the bank.

Pandit, who took over in December 2007 from the deposed Charles Prince, has voiced his commitment to breathing life into the troubled bank, and is widely seen as not being part of Citi’s problem.

However, amid criticism that Citi hasn’t moved fast enough to clean up its balance sheet and speculation that Citi may need to raise more cash amid rising writedowns from consumer debt, sources said there’s a growing sense Pandit might have to be sacrificed.

Pandit inherited the mess of Citigroup at the end of 2007 and has done a fairly decent job at getting it back on track or at least moving in the right direction.  Obama should know all about inheriting messes, since that’s all he can say when he speaks about the economy – does that mean we can oust him since the economy hasn’t turned around since his election?  They run a big risk by doing this of completely demolishing Citigroup and the financial system.  Pandit’s strides over the past year and his business strategy going forward have helped the company, but it will take time.  If they oust him before real results can be seen, we may see the collapse of this company.  But then again, that may be what the government wants in order to force these institutions into nationalization.

This is so completely anti-capitalist it isn’t funny!  The government should not be allowed to go over the heads of the board of directors or scare a company into making a decision that befits the government’s agenda.  Who in their right mind would ever want to become the CEO of a floundering company, when the MSM has put their entire focus and scrutiny on your job performance without giving you a chance to actually enact the appropriate changes?  The government and the MSM turn this into a public side show and a witch hunt – something that the Obama Administration is incredibly good at.  They turn the focus off of those who really caused this mess, namely the government and some prominent democrats, and spin it into another AIG debacle.  This is shameful.

Credit Suisse has caught onto this game and they’re not happy.  They are in fact warning about the over-involvement of the government in private business affairs.

The chairman of Swiss banking giant Credit Suisse on Friday warned against excessive government intervention in the lending policies of banks that have been bailed out by the state.

“In view of the growing number of banks relying on government support, however, I have concerns that excessive state intervention regarding the lending policies of banks or the realignment of their structures could have negative implications for the entire sector,” said Walter Kielholz.

Many of Credit Suisse’s competitors, including local rival UBS, US banks Citigroup and Goldman Sachs, have received state funding to weather the financial crisis.

Credit Suisse has turned to private investors, but has not taken government funds.

Kielholz acknowledged during the bank’s annual general meeting that state intervention had been necessary to prevent a meltdown of the entire financial sector.

However, he said the action by governments to inject funds into banks was already giving rise to a “two-tiered banking system.”

“This has led to a distortion of competition, particularly in the refinancing market or in terms of client guarantees,” he explained.

“There is also uncertainty about how and when governments will be able to exit their stakes in these companies,” he added.

In addition, he cautioned against over-regulation of the sector, saying that while stricter supervision has been prescribed for the sector, the “benefits of additional regulation have yet to be demonstrated.”

“In particular, I believe there is a risk that these changes could be exploited as a means of ushering in protectionist measures,” he warned.

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