Robert Rubin becomes Citigroup "senior counselor"

By Jonathan Stempel

NEW YORK (Reuters) - Former Treasury Secretary Robert Rubin has taken on the title of "senior counselor" at Citigroup Inc (C.N) as part of several changes to the board of the largest U.S. bank by assets.

Rubin, who turns 70 on Friday, will give up the chairmanship of the executive committee, which is being dissolved. He will remain on the board, and his role at the New York-based bank is unchanged, spokesman Mike Hanretta said.

The executive committee's only function was to act for the board between regularly scheduled meetings, the spokesman said. The nomination and governance committee, led by Time Warner Inc (TWX.N) Chairman Richard Parsons, will fill that role.

Rubin served as an economic adviser to President Bill Clinton in 1993 and 1994 and was Treasury secretary from 1995 to 1999. Lured to Citigroup in 1999 by then Chief Executive Sanford "Sandy" Weill, Rubin has focused mainly on strategy, leaving day-to-day operations to others.

Vikram Pandit has been chief executive since December, after Weill's handpicked successor, Charles Prince, resigned the prior month. Parsons is the bank's lead director.

"Pandit is continuing to exercise his increased authority over the future of business," said Michael Holland, founder of the money manager Holland & Co in New York. "Sandy Weill brought in Rubin, and Prince kept him as a consigliere. It looks like Dick Parsons is moving to the fore."

Rubin was unavailable for comment.

Pandit is reorganizing businesses and the board to improve efficiency, rebuild investor confidence and restore profit following $17.4 billion of losses tied mainly to credit market problems in the nine months ending June 30.

Rubin became interim chairman in November after Prince left. Sir Win Bischoff became permanent chairman in December.

Holland said it makes sense to keep Rubin on.

"Rubin has, to a great extent, emerged unscathed from some of the criticism of Citigroup's problems," he said. "Rubin's combination of contacts and influence is very unique and something Pandit can take advantage of."

Citigroup announced other board assignments on Monday.

Anne Mulcahy, Xerox Corp's (XRX.N) chief executive, will chair the corporate subcommittee of the audit committee. Lawrence Ricciardi, a former general counsel and adviser to the chairman of International Business Machines Corp (IBM.N), will join the consumer subcommittee of the audit committee.

Only outside directors will sit on the bank committees and subcommittees, Hanretta said.

Citigroup shares fell 21 cents to $17.93 in afternoon trading on the New York Stock Exchange. Their 52-week high is $49.00, set last September 19.

(Additional reporting by Dan Wilchins; editing by John Wallace)