Citi's CEO may have edge over Merrill's, for now

By Dan Wilchins - Analysis

NEW YORK (Reuters) - It's early days but after half a year, Citigroup Inc (C.N: Quote, Profile, Research, Stock Buzz) Chief Executive Vikram Pandit may be doing a better job navigating the mortgage meltdown than Merrill Lynch & Co Inc (MER.N: Quote, Profile, Research, Stock Buzz) CEO John Thain.

Both Pandit and Thain took the reins at their respective financial institutions late last year, after their predecessors had already recorded billions of dollars in write-downs and credit losses.

When Thain took over, he was widely praised for his work as chief operating officer at Goldman Sachs Group Inc (GS.N: Quote, Profile, Research, Stock Buzz) and CEO shepherding the New York Stock Exchange through a global expansion via the takeover of Euronext.

Pandit was more of an unknown and some critics questioned whether he had enough experience in areas such as consumer banking.

"I had mixed emotions when he became CEO. But it was a great decision. Citi is much further ahead of where I thought it would be at this point," said Robert Olstein, Chief Investment Officer at the Olstein Funds, which manages about $1 billion and owns about 2.36 million Citi shares.

In the first two full quarters with Thain and Pandit as CEOs of their respective banks, Citi so far has had a better trajectory.

The largest bank in the U.S. by assets recorded $22.8 billion of write-downs in the fourth quarter, $16.8 billion of write-downs and credit costs in the first quarter and $11.7 billion in the second quarter.

Merrill Lynch, meanwhile, recorded about $16.7 billion of write-downs in the fourth quarter, $6.5 billion in the first quarter and $9.7 billion in the second quarter.