Tuesday, March 03, 2009
The fall of Citigroup, continued
More on (pun intended) the Citigroup debacle in a recent Economist article.
The gist of this one is that Citi was too big to manage. Anyone who has worked there could tell you that much. Whilst inside the belly of the beast in the early 2000s, it occurred to many of us that there was no way anyone could keep track of the behemoth wrought by Weill. With 300,000+ employees, operations scattered literally to the four corners of the world, languages, cultures, banking laws, customs, technologies, currencies, and controls of every stripe imaginable, Citi defied the imagination.
I went for months at a time without talking to anyone outside the company. Between our cash processing at Citibank in Delaware, our umpteen acquired portfolios in probably 20 states, our IT in NYC, our foreign operations in Canada and Puerto Rico, our nun-with-a-ruler auditors crawling over the entire operation like ants, and management EVERYwhere, I spent days, weeks, months on interminable conference calls, fighting for my little projects, fending off intrusive managers looking to validate their positions, auditors more concerned with methods than results, and an aversion to risk at all levels which bordered on psychosis.
We got very little actually done, but burned calories and brain cells at suicidal rates. Any minor success was often chalked up to the "even a broken clock is right twice a day" theory, rather than any talent or skill on the part of the victorious party.
It's no surprise to me that all sorts of illegal and bone-headed shenanigans were going on in the brokerage and mortgage lending areas. I submit that these are only the illegal and bone-headed shenanigans which came to light. Many more were occurring in less-sensitive areas or by crooks or bone-heads less ambitious or more skilled in covering their tracks.
Morale inside Citigroup, at least amongst those I worked with directly, was horrible and beaten down back in the days when Citi was a money factory. Now that the red ink is flowing in Zambezian torrents and the axe is swinging indiscriminately, I'm sure it's as much fun as a Dickens-era garment factory.
Thank the sweet, clean Maker of Us All I got out of there when I did!