FDIC FOIA Discloses Pandit Future Could Promptly Converge With That Of Ken Lewis

Tyler Durden's picture

It was immensely refreshing to find an actual probing piece of investigative journalism coming out of Reuters, instead of the traditional regurgitated, opinion-based, fluff-filled, secondary source monologues (we prefer the British spelling) we have become accustomed to seeing out of the Thomson Reuters behemoth. In a rare example of how even the MSM gets it right sometimes, Matt Goldstein has done an admirable job of connecting the dots based on a FOIA request he had submitted to the FDIC, in which the insolvent (as of Be today) Deposit Insurer has provided Goldstein with a unique glimpse into the daily travails and activities of its boss, Sheila Bair, and how they may have a direct bearing on the future of none other, than a very troubled Chief Executive Officer.

From Goldstein's "Bair's summer in the Citi"

The FDIC provided Reuters with a copy of Bair’s datebook from June through August in response to a Freedom of Information Act request. The 92-page document offers a window into the FDIC chairman’s world, providing a brief listing of who Bair met with during that three-month period.

There is no record of what was discussed during those meetings, so it forces one to become a bit of a detective to piece together what may have been on the agenda. One can only guess what Bair and Alan Greenspan talked about over lunch on July 1, or what she and bank analyst Meredith Whitney may have chatted about on July 9.

But it is Bair’s frequent consultations with Parsons and other Citi board members that really jump out from the pages of the datebook. In June alone, Bair met with Parsons three times.

Matt follows up with some interesting observations:

It’s been clear that Parsons has taken the lead in handling Citi’s often tense relationship with the FDIC and other federal agencies. But it’s still surprising that neither Pandit nor anyone from his team met with Bair, even after Citi did as the FDIC requested and installed a new chief financial officer on July 9 along with other management changes.

These days the storyline coming from those close to Citi and its 17-member board is that Parsons has managed to smooth out any lingering bad feelings between Bair and Citi’s top management.

Some of that bad blood stems from the FDIC throwing up a road block to Citi’s unsuccessful bid for Wachovia. The former Time Warner chairman and chief executive supposedly convinced Bair not to push for Pandit’s ouster and put the FDIC chairman more at ease with the direction Pandit is taking the bank.

And what all this means for the future of Vikram, who has been practically incognito since Ken Lewis became the fall guy for Wall Street a month ago compliments of Jed Rakoff and everyone else, who jumped on that bandwagon.

Pandit may not want to rest too comfortably. The apparent absence of any one-on-one between Bair and Pandit may speak volumes about her true feelings.

That’s because Bair managed to make time to meet with executives from other big banks that have received assistance from the federal government. On June 30, for instance, she met
with Wells Fargo CEO John Stumpf and Howard Atkins, the bank’s chief financial officer. And on August 11, she met with Bank of America’s new chief risk officer, Gregory Curl.

And now that Lewis is gone (although his trail is still very much warm: his departure in no way has changed the presumed imminent filing of charges against him by the SEC, and various AGs), the public's eye may turn to the other deathly wounded CEO, who even after practically ceded control of his company to the taxpayers, is still shockingly in his throne.

Parsons’ last get-together with Bair during this three-month stretch occurred on August 10. Three days later, the Financial Times ran a story that Citi, at the request of regulators, had hired an outside consultant to conduct a top-to-bottom management review and recommend additional managerial changes.

The outside consultant’s management review is supposed to be presented to Citi’s board and regulators sometime in October — around the time the bank reports third-quarter earnings.

So should Bair have reason again this fall to talk to Parsons, the result may be less comforting to Pandit and his management team.

Only naive idealists may think that Pandit has more than 6 months left in his CEO tenure. The fact that he has managed to last this long alone is amazing. And Zero Hedge will be closely following the strategic moves undertaken by the CEO of the company which, alongside BofA, has the most toxic combination of assets on its balance sheet. In the meantime, thanks Matt, not only for bringing us this highly informative FOIA, but showing to your Reuters colleagues that it is really not all that difficult, and it "can be done" if one were just willing to put in that little extra effort.

Goldstein FOIA response presented in its entirety:


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Anonymous's picture

Vikram Bandit, heading to a slammer near you!

Tesla's picture

Why? He came in after Prince made the big mess.

Anonymous's picture

hmmmmm why a meeting with Meredith Whitney? This kind of nonsense should not be allowed.

Cognitive Dissonance's picture

Maybe Sheila can't trust her own in-house assessment of the banking industry and she wanted to get an outside view from a non biased analysis?

Or maybe she wanted a little girl on girl action?

Either explanation sounds OK to me.

Mos's picture

Your second scenario is not ok with me considering, how shall I put this, the "characteristics," of the two parties.

Screwball's picture

Whitney upgraded GS on July 13th.  I had to look it up.  Don't know why, just did.

Anonymous's picture

How goddamn convenient - meet w/ Bair on Thursday, July 9 - upgrade Goldman Sachs the following Monday, July 13th. Coincidence?

MinnesotaNice's picture

My thoughts exactly...

Cursive's picture

I noticed this as well.  Posted far below before I read comments.  Good catch.  I'm sure they were only discussing the newest swim suits, how to hide cellulite in the summertime, which Hampton cottage is the most coveted, etc.

Rama V's picture

Re: "secondary source monologues (we prefer the British spelling)"


The reference to UK spelling explains why Marla was earlier working her figures on a napkin.  Ideally she used a pencil so that she could simply whip out a rubber to correct her mistakes.

Cognitive Dissonance's picture

Jolly good show old chap. Rubbers it is then!

deadhead's picture

i am glad to hear that Marla practices safe sex and all that.

Anonymous's picture

VP sold his hedge fund to citi for 800,000,000 usd which promptly crashed and as a reward for this great trade somehow became CEO of a massive global retail banking empire...guess reading "banking for dummies" cover to cover 5 times was not a substitute for the 20 years of experience that were actually needed.

Anonymous's picture

Outside consultants never bring good news for management. It's a cue to clean out your desk.

ghostfaceinvestah's picture

Pandit has no business running a commercial bank.  No wonder Bair doesn't meet with him, what would they talk about?  Like he has any clue how their FDIC-insured entity actually runs?

Anonymous's picture

Matt Golstein always does excellent work. Lucky for you he's avaiable to link to

Anonymous's picture

Hey, wait a minute. Am I the only one that can read the text that's been blacked out under b8 rules?

For example:

June 2, 2009 3:00pm
Meeting with Dick Parsons, Citi

June 22, 2009 4:00pm
Meeting with Dick Parsons, Mr. Grundhofer, and Mr. O'Neill

I didn't look any further, but I've seen this stuff happen before - someone thinks that running a black marker over some text on a printout will hide that text from a scanner. News flash: it won't!

Ze Cacetudo | The Daily Hype

ZerOhead's picture

You're the only one who bothered to zoom in...

Christ...  these FOIA requests hold nothing back... can't wait to see if the Fed uses the same shitty chinese marker...

Someone is going to loose their job over this one.

Anonymous's picture

Yes, I believe someone will be (and should be) fired for this. I think the same sort of thing has happened before, so they should have known better.

But still - they screwed up, we get a little more sunlight! I share your sentiment about the inevitable b8 redactions on the Fed's FOIA requests, assuming those see the light of day.

Ze Cacetudo | The Daily Hype

deadhead's picture

that marker thing is beautiful...

i can hear the "oh shit-o-meter" going off.

sheila, why the hell you blocking out the meetings with citi and wells????


ZerOhead's picture

Personally my favorite was the Aug 11th three o'clocker with Gregory Curl the Cheif Risk Officer down at B.O.A.

Wonder what that was all about....

deadhead's picture

Bair: "Nice to meet you Mr. Curl. Please do exactly the opposite of your predecessors because my agency cannot afford you not to"

ZerOhead's picture

Better that than...

"Houston... we have a problem..."

Miles Kendig's picture



I imagine they are still on the adolescent should we or shouldn't we action. If they ever grow up we had better take notice.

BTW, the black marker has been the joy of Archives diggers for a while now. 

Careless Whisper's picture

They can't even black-out something properly. Gives incompetence a new meaning. Maybe ZH should have a bake sale and donate a paper shredder for Sheila.

Miles Kendig's picture


Or just a dime store exacto knife.

Hephasteus's picture

Hiding things is all fun and games until the scanners show up.


J.D. Swampfox's picture

Chairbair has little influence over the big banks...that's all Bernanke's sphere.

Hephasteus's picture

She's a vital rule bending consultant. Assessing risk of rule bending. She has enormous influence. LOL

Anonymous's picture

Actually check out Reggie Middleton and you will see that JPM is the one most likely to take down the country in one swoop:
Go to this link, click accept and enjoy!!

jm's picture

Pandit didn't make the mess.  But Pandit is basically a quant, and he put his head down and tried to patch up risk management.  Even now, it doesn't seem a viable task.   

He will never fit as CEO: he has no vision like a typical CEO.   But he deserves better than to get thrown out like trash because he rubbed Sheila Bair wrong.

Anonymous's picture

when through reckless behavior you are at the
mercies of the government one's wishes of
fate are as meaningful as fairies and flying

Anonymous's picture

jm ...i think you spelt quant wrong. he is certainly a total quant. leverage made possible by too many cpu's and lots of complete and utter quants like v.p. who should have stuck to electrical engineering caused this mess.

jm's picture

I admit that "deserves better" was a stupid thing to say.  Deserves is nothing in this world.  I saw a comment about him going to the slammer, and it pissed me off a little.

Personally he may have been a cock. Traders down on him, bankers very down on him--not saying they are wrong to be. 

But he took $1 this year and no bonus (he may sneak one in yet) to untie a gordian knot. 

Anonymous's picture

Goldstein is one of the best financial muckrakers out there these days. Kudos Matt

Sqworl's picture


Careless Whisper's picture

"...since Ken Lewis became the fall guy for Wall Street a month ago compliments of Jed Rakoff and everyone else, that jumped on that bandwagon."

Kenny boy isn't taking the fall for anyone but himself and his lies and his bad business judgement. Judge Rakoff didn't start any bandwagon, he just wants individuals to be accountable.

And WTF did you do with Tyler?

Tyler Durden's picture

"diversion" is probably a better word in retrospect. with his charade no longer key, other CEOs can take their turn in line.

Miles Kendig's picture

Which is a key to a noteworthy unwinding Tyler as I am sure you appreciate.  Once the C-Suite realizes that they elicit all the care & consideration of Bernanke that a Ukrainian foot soldier did to Zhukov, most likely even less, then you had better have some enhanced means of keeping up with the rapid increase in flow.

Anonymous's picture

Pandit is a joke, along with most the lords of finance. He set up an interest rate arbitrage hedge fund to borrow short to pay for higher yeilding long term assets. In effect a ponzi scheme. The guy was considered the smartest guy in the room for doing this. It blew up and cost citi about a billion. This isn't finance, it is bull shit. Like most of the masters of the universe, he's smart, but the real way you get ahead is being a confirmed member of the Ponzi scheme. "don't tell on us and we won't tell on you and we will all the rich even when this crap you are pushing blows up, nod, nod, wink, wink"

Anonymous's picture

bullshit does as bullshit is...

he was too clever by half....the smart ones
are always so full of themselves that they
blow up like a constipated sausage...

Problem Is's picture

Wow. Here are some ANONYMOUS blasts you can believe in.

You ANONYMOUS guys are on fire... or is it you the ANONYMOUS guy is on fire?

Anonymous's picture

Has this Pandit guy ever did anything right except for stuffing his pockets? His hedge fund (Old Lane Partners) was a complete failure which had to be bailed out by Citi. His MS career was less than stellar. He is completely clueless about what's going on and hasn't done anything to split up this monstrosity. Wtf is he doing here?

Problem Is's picture

Are you nominating Pandit for the:

Robert "What Me Worry?" Rubin, 2009 Cheese Dick of the Year Award?

An excellent candidate you put forward, sir, if I do say so myself...

Anonymous's picture

bandit rose according to the peter principle...now that bair is about ready to bite his off, we can watch citi get dismembered as it so richly deserves....

citi was an accident waiting to happen - too big too abstruse and too poorly managed.....good riddance to both of them....and i hope someone doesn't forget to put a torch to his head on the way out....these asswipes are a blight on humanity.....

Miles Kendig's picture

All part of the squids plans.

Stevm30's picture

Christopher Flowers August 11th?  What's that all about?