Vikram Pandit exits Citi, but golden parachute is missing
Vikram Pandit may leave Citigroup Inc without a rich exit package, compensation experts said, although final terms of his departure likely will not be known for several days.india Updated: Oct 17, 2012 21:21 IST
Vikram Pandit may leave Citigroup Inc without a rich exit package, compensation experts said, although final terms of his departure likely will not be known for several days.
Pandit, who stepped down as chief executive of the bank on Tuesday is not eligible for a "golden parachute" - a pre-negotiated severance payout - according to Citigroup's recent annual proxy filing.
Still, as is typical in departures of high-profile CEOs, the company may end up hammering out a financial arrangement with Pandit that would include agreements not to disparage or compete against the bank, executive pay experts said.
Pandit's pay has riled many Citigroup shareholders, who rejected his proposed annual compensation in a non-binding "say on pay" vote earlier this year.
The Citigroup board is likely feeling pressure to rein in any further payouts to Pandit, said Mark Borges, a compensation consultant with pay consultancy Compensia.
The company declined to comment on financial terms of Pandit's departure, and he did not immediately respond to requests for comment.
Pandit arrived at the bank in 2007 with a deal of $165 million. He accepted a $1 salary starting in 2009, after the financial crisis that led to a government bailout of the bank. After Citigroup repaid the bailout funds, his annual salary jumped to $1.7 million in 2011. He was awarded a bonus, options and other payments that year potentially worth about $13.2 million.
Pandit holds bundles of Citigroup stock options, but the bank's languishing share price has left many of them worthless. He has no pension plan, and leaves with $21.5 million in stock he owns.
Under a separation plan, the bank could allow Pandit to accelerate his options, receive payments under the long-term incentive plan or negotiate a pro-rated 2012 bonus.
First Published: Oct 17, 2012 21:17 IST