New York - The chief executive of Citigroup, the largest US financial firm, resigned Sunday amid fallout from the subprime mortgage crisis. Prince is to be replaced by Sir Win Bischoff as interim chief executive and Robert Rubin as chairman, the company said Sunday evening after an emergency board meeting.
Charles Prince stepped aside as the bank is to take an additional 8 billion to 11 billion dollars in writedowns on mortgage-related securities after earlier reporting 2.2 billion dollars in writedowns and losses related to the mortgages in the third quarter, the Wall Street Journal reported.
"It is my judgment that given the size of the recent losses in our mortgage-backed securities business, the only honourable course for me to take as chief executive officer is to step down," Prince said in a statement.
The banking industry has been plagued by defaults on so-called subprime mortgages to borrowers with poor credit and a weaker US housing market.
Bischoff, 66, will serve until a permanent replacement can be named. He is the head of the company's European division and led asset management firm Schroders in London before it was acquired by Citigroup.
Rubin, 68, was a current member of the board and chairman of its executive committee.
Prince is the second chief of a major US financial firm to step aside in the past week. Stan O'Neal, chief executive of US investment banking giant Merrill Lynch & Co, stepped down Tuesday under pressure from the board. The firm had 2.3 billion dollars in losses in the third quarter after the company had to write off 7.9 billion dollars in the wake of the mortgage and credit sector crisis.
