Citi’s Klein walks away with £21.4m
Michael Klein, the chairman of Citigroup’s institutional clients group, will walk away with a non-competition pay-out of £21.4m ($42.6m) when he leaves the New-York based bank later this year.
The staggered scheme will see Klein receive £2.8m on 1 August, followed by £10.7m in March 2009 and £3.8m in October 2009, providing he does not work for 12 of Citigroup’s largest competitors, including JPMorgan Chase and Goldman Sachs, until the agreement comes to an end.
Working for “alternative asset management businesses” such as private equity firms is allowed, as long as Klein does not provide investment banking services. It is also understood that Klein will retain £4.2m in previously awarded stock.
Klein was once widely viewed as a contender for the top job at Citigroup, but in March this year, sparks flew as new chief executive Vikram Pandit appointed his former business partner John Havens to run the institutional clients group in his place.
In the same month, Klein was denied a bonus for 2007 after the bank reported a £4.9bn fourth quarter loss, having to settle instead for £9.7m in deferred cash retention awards and retention equity awards. The latter were due to mature over a two to four year period and the terms of the agreement stipulated that Klein be employed on the vesting date.
Citigroup said last week that Klein, 44, would leave to “pursue other opportunities” in September.