Woopsies! Former Citigroup Inc. (NYSE:C) co-CEO and co-chairman John Reed, who helped engineer the 1998 merger between Citicorp and Travelers Group, apologized Thursday for co-authoring a monster that has sucked in $45 billion of aid, Bloomberg reports.
"I'm sorry. ... These are people I love and care about. You could imagine
emotionally it's not easy to see what's happened."
But in unburdening himself -- what a relief, right Reed? -- the banker also called attention to the fact that Citigroup still pays for him to have an executive assistant. Not only that, but the beleaguered bank also foots the rent on his Park Avenue office.
Lavishly funded retirements aren't unusual for former CEOs, of course. But given the public stake in Citi, which Reed left in 2000, the perk does look a little awkward.
The interview, which took place at said Citi-funded office, was also noteworthy for Reed's regret that the Glass-Steagall Act separating commercial and investment banking had ever been repealed. The creation of Citi, of course, was the final blow against the depression-era law separating investment and commercial banking activities. Now Reed has joined Paul Volcker and others in saying that was a mistake.
Also striking was Reed's argument that executive compensation at banks should be in line with performance. As Bloomberg points out, between 1997 to 1999, Reed received salary and bonuses totaling $23.4 million. In 2000, when he retired, he left with a $5 million retirement bonus.
He didn't get into the issue of clawbacks, a hot subtopic in the debate over Wall Street comp. But if he's sincere about all this, maybe he should give it some thought. - Sara Behunek
See the full Bloomberg article here
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