Throughout a long, public career, Robert E. Rubin spanned the highest reaches of Wall Street and Washington, and succeeded wherever he went. Now he may be facing his most difficult challenge — helping to revive Citigroup, which said yesterday that it would take an additional $8 billion to $11 billion write-down related to sub-prime mortgages, on top of the $5.9 billion reported in early October according to the New York Times.
The unexpectedly large write-down, which could wipe out fourth-quarter earnings, underscores the disarray at Citigroup, the once-proud institution built by the financier Sanford I. Weill, and the deepening crisis in the broader housing and credit markets, which threaten to weaken the overall economy.
The troubles at Citigroup, “the House that Sandy Built,” have become so deep that Charles O. Prince III resigned yesterday as chairman and chief executive. Mr. Rubin, 69, the former Treasury secretary who was recruited to the bank in 1999 as an adviser to Mr. Weill, was named chairman while the board begins a search for a chief executive.
Read it here: Fixing Citigroup Will Test Rubin