Salomon Smith Barney reps are reacting with disappointment to the surprise resignation of firm co-CEO James Dimon on Nov. 1.
Dimon, 42, had been considered the heir apparent to 65-year-old Sanford Weill, former Travelers' chairman and now co-chairman of Citigroup, the new financial conglomerate formed in October after the merger with Citicorp.
The firm announced that Michael Carpenter, former chairman of the Travelers Life & Annuity unit, would replace Dimon. Carpenter had previously run General Electric's Kidder Peabody unit during the bond trading scandal that ended with the ouster of trader Joseph Jett. Carpenter was praised for his work at Travelers but criticized for failing to deliver promised synergy between GE and Kidder when the two companies' corporate finance units began squabbling.
Recruiters and brokers say the loss of Dimon and insertion of Carpenter creates a feeling of instability and uncertainty about the future direction of the firm, especially in the wake of a complex merger that will bring restructuring in some areas.
"In the beginning, nobody was really excited about the merger [with Citicorp]," says Mark Elzweig, a recruiter in New York. "Nobody had a tangible feeling as to how this could help them. [Dimon's departure] has deepened this pre-existing skepticism."
Many brokers feel Dimon, whose father is a broker, had their best interests at heart, Elzweig says. Despite his occasional clashes with Weill, and his cost-cutting efforts that sometimes irked reps, Dimon was considered an insider who had contributed greatly to the firm's success.
"I felt he was a friend to the broker in the trenches," says one West Coast rep who had met Dimon several times. "He's one of those executives who you feel is listening to you. He would willingly go into a group of brokers and be real honest and direct."
The move may have more impact on reps' stock holdings than their day-to-day business. Several analysts have downgraded Citigroup's stock in the wake of Dimon's departure.
"I've never met Jamie Dimon," says one Florida broker at the firm. "We're probably concerned more as stock holders, than employees."28
