Citi shareholders fume at annual meeting

[bemildred]

Source: CNN

NEW YORK (CNNMoney.com) -- Investor outrage boiled over during Citigroup's annual shareholder meeting Tuesday, as shareholders picked apart company management for what they viewed as a litany of failures over the past year.

But even as tensions flared, efforts aimed at reshaping the bank, including ejecting long-standing directors, fell flat.

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A wide variety of shareholder proposals, including one that would have effectively established an election for directors, was among those that failed.

With an estimated 1,500 shareholders in attendance, Tuesday's event became a forum for angry investors that have seen their personal fortunes evaporate over the past year.

Read more: http://money.cnn.com/2009/04/21/news/companies/citigroup_meeting/?postversion=2009042117

[tomm2thumbs]

1. they all gave themselves heart attacks, got nothing accomplished and went home. Like GOP tea party

Maybe they should combine the events

[BumRushDaShow]

2. The taxpayers are "shareholders" now too. Get in line! n/t

[Sgent]

3. Not in Citi

or at least not what is commonly thought of as stockholders.

We own preferred shares -- which are non-voting, and generally doesn't have any rights to decide on directors / management except under certain conditions (if then).

[girl gone mad]

6. That's not completely accurate.

We reached a deal with Citi to convert preferred shares to common (at a 35% premium) back in February.

From the Wall Street Journal:

Citigroup Inc. and the federal government agreed to a third rescue that will give U.S. taxpayers as much as 36% of the bank but expose their ownership stake to greater risk from the recession and housing crisis....

The Treasury has agreed to convert some of its current holdings of preferred Citigroup shares into common stock, a move that could better protect shareholders against future losses.

As a condition, the government is demanding that the New York company overhaul its board of directors. Citigroup's board will soon include a majority of new independent directors, the company said Friday. Chief Executive Vikram Pandit is expected to keep his job under the agreement.....

While the government isn't injecting additional taxpayer dollars into Citigroup, the agreement will help the company by boosting a key financial metric known as tangible common equity, which essentially measures what shareholders would have left if the company were liquidated. The government and banks have concluded that beefing up tangible common equity was a key to arresting the downward spiral in financial companies' shares....

The conversion leaves taxpayers exposed to the risk of greater losses. The government's preferred holdings had stood ahead of common stock in Citigroup's capital structure, meaning they were less likely to lose value if the company's woes continue to mount. In addition, by converting much of the U.S. stake to common shares, Citigroup won't have to pay the hefty dividend payouts that were attached to the preferred stock....

[girl gone mad]

4. Oh, my..

There were also some jeers for former interim chairman Robert Rubin, who stepped down from the company's board earlier this year following scrutiny about his role in allowing the financial giant to overextend itself in the U.S. housing market.

Is the investor class finally getting restless? What will Citi do when they can no longer hide the losses with accounting legerdemain?

Rubin is Geithner's crooked mentor, fwiw.

[bemildred]

5. Bullshit will only take you so far. nt

[On the Road]

7. And Yet

"Efforts aimed at reshaping the bank, including ejecting long-standing directors, fell flat."

There is something wrong with corporate governance when not even a stockholder revolt results in any changes. The rules have to be changed.

[bemildred]

8. "corporate governance" is a dog-and-pony show.

It ought to be more than that, it's true.

[On the Road]

9. There's No Reason It Has to be

Left to its own devices, management-labor relations almost always favors management. Thus the need for labor laws. Strangely enough, I haven't heard of any propsals to change things from any political angle or even people like the Freakonomics guys.

[bemildred]

10. I like workplace democracy myself.

The employees own the place. When they are hired they get a share. When they quit, get fired, or retire, the share goes back to the corporation. Other people can invest, but nobody else gets to vote.

[pjt7]

11. Shareholders

got screwed by these criminals

[On the Road]

14. That's Why it Mystifies Me

that so many people can be up in arms and yet none of the players get changed.

I figure it's because the pension fund and mutual fund managers, who usually control the majority of shares, are reluctant to be activists. Losses don't come directly out of their pockets, after all.

There have got to be more effective guidelines, though. Ideas get thrown around for all sorts of things, but there is a noticeable silence in this case.

[bertman]

12. I can hear the hounds baying in the distance. And I'm a bit hard of hearing.

[johnnyrocket]

13. Wow, those shareholder votes never go as 'planned'....gee. it's like they're rigged or something.

Shareholder votes...what a fucking joke. I've never, EVER heard of shareholder votes doing anything to change the course of a company.