After four months in her new home at Citigroup, Sallie Krawcheck is starting to clean house.
The 38-year-old head of the giant group’s research arm and consumer stock sales dumped two top stars and installed several trusted allies as her key aides.
Krawcheck, dubbed the “last honest analyst on Wall Street” by Fortune, was recruited by Citigroup chief Sandy Weill to reform his tarnished outfit after it paid $400 million in fines for peddling slanted research to the public.
Krawcheck’s head-rolling surprised many Wall Street veterans because her targets were ranked last spring as the top heads of research in a poll of fund managers by Sammons Associates.
Ousted are Michael Crawshaw and Richard Dale, both 39. Another top post – head of global research – was vacated a month ago by John Hoffman, who retired.
Krawcheck picked William Kennedy, former co-head of research for Nikko Salomon Smith Barney, to head global equity research.
Nikko Salomon Smith Barney analysts were rated “most-read” in the fourth quarter of 2001, when Kennedy was in charge, according to a survey of money managers by Thomson Corp.’s Nelson subsidiary
Replacing Crawshaw and Dale is Jose Garcia-Cantera, co-head of Latin American equity, who will take over European research.
She also elevated Garcia-Cantera’s deputy to head Latin America.
In a memo yesterday to the Citigroup staff, Krawcheck said: “We will operate with the highest ethical standards, and we will provide meaningful investment insights to our clients. In so doing, we will remind our many investing clients why they’ve placed their trust in our firm.”
Citigroup in October lured Krawcheck from her job running Sanford C. Bernstein’s independent research operations. She got a sign-on bonus of 750,000 options with a value of about $11.2 million at the time.
To clean up the brokerage group’s image, Weill set up a separate unit to handle consumer equity sales and research. Citigroup shares fell 50 cents to $33.15 yesterday.
Sweeping clean
CitiGroup’s new research chief Sallie Krawchek is wasting no time in cleaning house. Her moves:
* Fired equity research honchos Michael Crawshaw and Richard Dale
* Handed out pink slips to 70 investment bankers and 20 equity analysts in the European unit
* Named William Kennedy, former co-head of equity research for Nikko Salomon Smith Barney, as director of global equity research, and Jose Garcia-Cantera to take over European research