Tuesday, January 20, 2009

More Uncertainty for Citi Employees

As can be expected, with all the changes happening over at Citi, there has been an increase in the number of SEC forms filed by the company. Such filings are expected to provide a greater degree of transparency and disclosure.

But a recent 8-k filing by Citi group provided hardly any 'transparency'. The filing referred to the Citi- Morgan Stanley joint venture. It stated "Citi and Morgan Stanley have agreed to certain general principles regarding the parties’ intended treatment of Citi and Morgan Stanley employees who transfer to the Joint Venture..."

There were no additional details on such what these "general principles" might be. Isn't the intention of filing an 8-K to provide full and complete information to the public? It is hard to imagine that they are still working out the specifics.

As per the Joint Venture agreement, the board of directors of the Joint Venture entity will "have veto rights" with respect to "certain employees" for a period of three years.
Oh and by the way, there will be a majority of Morgan Stanley directors on this board.
If you ask me, this does not bode too well for Citi employees.

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