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| Feature |
Ms. Clean
Jan Alexander
01/01/2008
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One of your most important holdings abroad is Nikko Cordial, which
is Japan’s third-largest wealth manager but has, like Citigroup itself, suffered
from a regulatory run-in there. Does this feel like one of your make-or-break
challenges?
The wealth management part of me
believes Nikko is an excellent business. The issues it faced were really around
its private equity business. But the wealth management business—the core of
Nikko—is in very good shape. Our goal is by no means to fix it, but rather to
provide all of our capabilities to really open the flow.
Having been both an analyst of Citigroup and its CFO, are you
making yourself pinch pennies?
Krawcheck has earned her stripes at Citigroup cleaning up after men who flew too high. |
It’s on two levels. There are
the expenses that are spent on the senior executives—one has to question those,
and that is what the press wrote about. And then there are expenses to grow the
business. We have increased those, and we have plans to continue to invest
behind our advisors and our bank-ers. You always want to play to your
strengths. We will be adding advisors and bankers in Asia. We are adding to
technology in the U.S., in particular to help our advisors drive greater
productivity and greater insights for our clients. That’s the good cholesterol.
The bad cholesterol tends to be the more symbolic expenses. In
addition to the symbolic spending, we removed some layers of management. We had
global overlay, which was helpful at times in the private bank’s history but was
a layer not needed going forward. With fewer folks in between, I can find out
what’s going on in the field pretty quickly. And while I can’t personally
manage all 46,000 employees, the more you can do to facilitate that
back-and-forth, the better. You should see the conversations between
our client-facing professionals and our New York–based professionals—the
informal back-and-forth. It’s the most interesting cultural characteristic.
If you had it to do over as CFO, would you do it differently?
It was a tough time, however we
made some good decisions. I was very proud of the capital-allocation processes
we began to put into place, so that we are becoming more systematic, structured
and targeted.
The tough part was that the earnings were under pressure for us
as a company. With hindsight, there is always stuff you could have done better,
faster, more stringently. But I do believe that the movement from an acquisition
focus to a focus on balanced, organic growth in acquisitions is right.
To work through the breadth that is Citigroup, product-wise,
business-wise and geography-wise, is an experience that few people in the
industry get. So while I cannot tell you that every morning I jumped out of bed
saying "Yes! I’m the CFO of Citi!" I wouldn’t trade the experience for
anything.
So how did you manage to corner Sanford Weill on a plane?
I had invited him to go to
London to visit some investors, and I managed to get myself seated by him on the
plane. I didn’t quite stalk him, but I did spend however long it takes to fly to
London peppering him with questions. I think I exhausted him.
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