This week, Citigroup CEO Vikram Pandit abruptly stepped down from his post, sparking speculation that all is not well at the bank. Reports say Pandit clashed with the board, possibly over the future direction of the company, whose stock price has fallen 89 percent since Pandit took over. To be fair, Pandit got the job just before the financial crisis really began to spin out of control. But the fact remains that Citi is underperforming, and some say the bank has become too unwieldy to be properly managed. Is it time to break up Citi?

Yes. Investors are fed up: Compared to the money Citi brings in, its shares are trading at a "steep discount," says David Reilly at The Wall Street Journal. That's because the company currently has $171 billion worth of toxic assets housed in a "junk heap" called Citi Holdings, and investors won't buy in until it's gone. "Markets continue to send a message that Citi isn't acceptable in its current form," saying "essentially that it would be better to break the bank up and sell off the pieces."
"New Citi chief left holding on to past"

And so are taxpayers: New CEO Michael Corbat "could make himself into a hero to shareholders by breaking Citigroup into smaller, simpler, and more dynamic companies," says Simon Johnson at The New York Times. And taxpayers would thank him as well, since the too-big-to-fail bank essentially relies on an "implicit subsidy scheme" from the government. Citi still poses a threat to the entire economy, "and let's hope [that] ends as abruptly and as completely as Mr. Pandit's tenure."
"Running Citigroup without subsidies"

A break-up ain't happening: "Don't expect the world's financial supermarket to be dismantled anytime soon," says Maureen Farrell at CNN Money. "Citigroup cannot simply separate commercial banking from investment banking because both units serve many of the same clients." A corporate client, for example, receives a "host of offerings" from different units of the bank, "including loans, derivative products, and M&A advisory services." Corbat may pare Citigroup's trading unit, but the company isn't going to get significantly smaller.
"Don't expect a Citigroup break-up"