senior officials at the Federal Deposit Insurance Corporation privately discussed who might replace Mr Pandit if the bank needed more government aid

TO BE NOTED: From the FT:

"Fresh questions on Pandit’s future at Citi

By Francesco Guerrera and Joanna Chung in New York

Published: April 20 2009 23:38 | Last updated: April 20 2009 23:45

Vikram Pandit, Citigroup’s chief executive, will on Tuesday strive to convince investors that the company is on the road to recovery amid fresh questions over his future at the financial group.

Ahead of Citi’s annual investor meeting, it has emerged that senior officials at the Federal Deposit Insurance Corporation privately discussed who might replace Mr Pandit if the bank needed more government aid.

“It is unthinkable that Vikram could stay on if Citi requires more federal funds,” said a person familiar with the matter. “It is prudent to be thinking about different scenarios.”

The FDIC is only one of the regulators which has a say on whether Mr Pandit steps down if the government bails out Citi for the fourth time in six months following completion of the “stress test” of its health.

Any decision on Citi’s leadership will be led by the Treasury, which is about to take a 36 per cent stake in the company and will sanction further capital injections.

The Federal Reserve and the Office of the Comptroller of the Currency, which regulate national banks, will also have to bless top management changes.

People close to the situation said FDIC officials had discussed successors to Mr Pandit, who became chief executive in December 2007.

They include Ned Kelly, chief financial officer, Gary Crittenden, his predecessor and chairman of the division containing Citi’s non-core assets, and one of Citi’s new board members.

The new directors are Jerry Grundhofer, former chief executive of US Bancorp ; Michael O’Neill, former head of the Bank of Hawaii; Anthony Santomero, former head of the Philadelphia Federal Reserve; and William Thompson, former co-head of bond group Pacific Investment Management Co .

The FDIC and the other agencies declined to comment.

In a statement, Citi said: “Our recent quarterly results reveal the underlying strength of the franchise and Mr Pandit’s strategy at work to restore Citi to profitability.”

Citi shares have lost nearly 90 per cent of their value in the past year, following more than $50bn in writedowns and losses.

After closing at $1.02 in March, the stocks rallied, touching $4 last week. However, since Citi announced results on Friday, the shares have fallen 19 per cent, closing at $2.94 in New York.

Additional reporting by Julie MacIntosh in New York"