Human Capital & Careers

Citi CEO, Chairman, CFO, Decline Some Bonuses

Finance chief Crittenden, along with Vikram Pandit and chairman Bischoff, won't take incentive or retention awards from the troubled bank.
Stephen TaubJanuary 21, 2009

Citigroup said that finance chief Gary Crittenden, along with the struggling banking giant’s CEO and its chairman, all declined to take incentive or retention awards.

Chief executive Vikram Pandit and board chairman Sir Winfried Bischoff, along with Crittenden, won’t take the bonuses that are being doled out to other individuals, Citigroup reported in a filing.

The company, which has had its stock price fall to below $4 per share, said the other members of its executive committee did receive stock awards that will vest if Citi’s stock price meets specified price targets during the next four years. Half of each individual’s award has a price target of $17.85, and half has a price target of $10.61. These price levels were chosen based on the conversion prices of the warrants to purchase common stock issued by Citigroup to the U.S. Department of the Treasury on Oct. 28 and on Dec. 31.

These other members of the executive committee also received premium priced stock options, which have a 10-year term and will vest ratably over four years. Half of each individual’s grant has an exercise price of $17.85 and the other half has an exercise price of $10.61.

Citi also said on Jan. 14 and Jan. 20 awards were made under its Deferred Cash Award Plan to eligible employees, primarily in the U.S. and the UK, who have incentive compensation in excess of $100,000. These awards vest over a four-year period and earn interest during the vesting period at the 90-day LIBOR rate. Other terms are substantially the same as terms of equity awards made under Citi’s Capital Accumulation Plan.

In addition, on Jan. 20 the committee terminated the 1999 Executive Performance Plan, effective for the 2009 compensation year. The plan provided for the federal income tax deduction of performance based compensation awards. “Recent changes in tax laws limiting tax deductible executive compensation have superseded the need for the Plan,” Citi said.

Citigroup lost $18.72 billion in 2008, and a total of $28.55 billion over the last 15 months, due to the collapse in the mortgage market and the deterioration in value of other debt.

On Tuesday, it cut its quarterly dividend to one cent per share from 16 cents to comply with terms of the government bailout. Citi received $20 billion of capital from the government’s Troubled Asset Relief Program in November.

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