Citicorp Sendoff?

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By Newsweek Editors

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How long can Citicorp's embattled chairman, John S. Reed, hold onto his job? Reed has come under fire in recent months for the bank's dismal performance, largely the result of bad real-estate loans. Citicorp just sold 50 percent of Ambac, one of its more profitable divisions, and some analysts projected last week that the bank may only break even this year, possibly forcing a dividend cut. There have also been questions about Reed's personal life. He reportedly left his wife of 27 years for a flight attendant on his corporate jet.

Some Wall Street analysts believe Reed, 52, could be ousted as early as this week at the company's board meeting. "His job's definitely on the line," says a leading analyst. "He's turned that bank...to a shadow of its [former] self." But there's no strong heir apparent, and others predict Reed will hang on. At a two-hour meeting with Citi bankers last week, reported by American Banker, Reed said he was confident of board support. Alluding to his personal life, Reed said nothing is impeding his ability to manage the bank.

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