“Ex-Goldman executive Steve Mnuchin was never going to take OneWest and build a real, long-term banking business…

…He isn’t an operator. He is a trader who negotiated fabulous deals from the FDIC for IndyMac Bank and other troubled banks, at the height of the crisis, and bided his time, until the FDIC hold-period (I think designed solely to prevent embarrassment about their poor deal-making) expired and he could flip OneWest for a big gain (and resulting big loss to the FDIC insurance fund). And now you can see he is getting the heck out of CIT and fast (even the board). And now so is CEO John Thain…..another non-operator….who “retires” at 60. Neither of these guys knows how to build and operate a financial services business for the long run.”, Mike Perry, former Chairman and CEO, IndyMac Bank

October 21, 2015, Michael J. de la Mercedoct, The New York Times

John Thain of CIT Group Will Step Down as Chief Executive


John A. Thain, chief executive of the CIT Group, who will step down in March as the lender focuses on becoming a full-fledged commercial bank. Credit Nick Ut/Associated Press

After leading a yearslong turnaround of the CIT Group, a major lender to small and midsize businesses, John A. Thain — the executive who sold Merrill Lynch during the depths of the financial crisis — will retire.

CIT said on Wednesday that Mr. Thain, its chief executive , would step down from that role on March 31, as the firm continued on its path toward becoming a full-fledged commercial bank. That transition was cemented this summer when the firm completed its acquisition of OneWest, a California retail bank.

He will be succeeded by Ellen R. Alemany, a current board member who previously led the Royal Bank of Scotland’s businesses in the Americas and also held various titles at Citigroup.

Mr. Thain is not completely severing ties with the lender. He will retain his position as chairman.

Landing at CIT proved to be a comeback story of sorts for Mr. Thain, who rose quickly through the ranks of Goldman Sachs before becoming the head of the New York Stock Exchange. He then jumped to Merrill Lynch as chief executive, where he engineered the $50 billion sale of the Wall Street stalwart to Bank of America to save the firm.

Yet he was ousted from Bank of America a few months later, in 2009, amid multibillion-dollar losses, huge bonuses to staff members and a controversial renovation to his office.

The next year, however, he ended up at CIT, a firm with its own struggles. Though it had spent most of its life in the sleepy business of commercial loans to the likes of Dunkin’ Donuts, the company sought to become a Wall Street powerhouse by moving more aggressively into mortgages and student loans.

The housing crisis, however, meant that by 2009, CIT was unable to rely on the debt markets, which nearly capsized the firm. It briefly spent time in Chapter 11 bankruptcy before re-emerging — and soon after hired Mr. Thain.

During his tenure, CIT focused on developing its own base of deposits as a steadier source of financing. Buying OneWest — a regional bank built from the ashes of the failed mortgage lender IndyMac — proved the capstone of that transition, nearly doubling the size of the firm and earning it a regulatory designation as a systemically important financial institution.

CIT’s management team led the refinancing of roughly $31 billion worth of debt. Also during his tenure, Mr. Thain said in an interview after the announcement, the firm forged better relationships with its regulators, including the Federal Reserve.

That work led the executive to consider his next steps.

“All of the things that needed to be fixed are fixed,” he said. “The things the board hired me to do are completed, so I wanted to take some time off.”

For the last six months, Mr. Thain said, he had been negotiating with the board about retiring. His fellow directors pushed back, he said, though they eventually began to review a number of internal candidates for the chief executive position. Given that the lender was looking to become a commercial bank focused on the United States, Ms. Alemany’s experience with R.B.S. made her an attractive candidate for the role.

Other executive-level changes are in the offing. Steven Mnuchin, the firm’s vice chairman, plans to step down on March 31 but remain a director. And Carol Hayles, the company’s corporate controller, will become chief financial officer on Nov. 1, replacing Scott T. Parker, who announced his own departure on Monday.

As part of CIT’s ongoing evolution, the company also said on Wednesday that it would consider selling some of its existing operations, including its commercial airplane leasing and financing businesses as well as its Canada and China divisions.

CIT’s turnaround efforts have not necessarily persuaded investors. Its shares have dropped 14 percent over the last 12 months, closing at $39.88 on Wednesday.

Yet shareholders appeared happy with Wednesday’s news, briefly pushing the stock up more than 5 percent in after-hours trading.

For the moment, Mr. Thain said, he has no plans after retirement — except perhaps some cross-country travel.

“The only thing I want is to spend time with my 2-year-old granddaughter in L.A.,” he said.

A version of this article appears in print on October 22, 2015, on page B6 of the New York edition with the headline: Chief of the CIT Group Announces Plans to Retire

Posted on October 22, 2015, in Postings. Bookmark the permalink. Leave a comment.

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