John Thain, widely seen as a favourite to become chief executive of Citigroup, was not on the first shortlist of candidates considered by the search committee of directors on Tuesday.
The list comprised a number of internal and external candidates, including Bob Willumstad, but not Mr Thain, according to a person familiar with the process.
However, it is possible he could be added to the list later.
The omission of Mr Thain will come as a surprise to many observers who saw the chief executive of NYSE Euronext as one of the strongest contenders to replace Chuck Prince, who quit as chairman and chief executive 10 days ago.
A former president of Goldman Sachs, Mr Thain, 52, is perceived to have done a great job since becoming head of the NYSE in January 2004.
But some senior Citi figures have doubts about his suitability. He has not run a big organisation and has no experience of retail businesses. They also say there is speculation that some top executives could leave if he was appointed, notably Vikram Pandit, who was recently made head of all Citi’s institutional businesses.
Mr Pandit, who is believed to be on the shortlist, is highly regarded by Robert Rubin, who took over as chairman when Mr Prince stepped down. But senior insiders think it unlikely he will be chosen, partly because he has been with the company for only six months.
Bob Willumstad, 62, who left Citi in 2005, was expected to succeed Sandy Weill as chief executive until Mr Weill suddenly changed his mind and opted for Mr Prince.
He is widely liked and respected but some insiders believe his chances may be hampered by the way Mr Prince criticised the lacklustre performance of Citi’s US consumer businesses, which had long been Mr Willumstad’s responsibility.
It is also unclear whether Mr Willumstad would accept the job. He is now chairman of American International Group, the insurer, and has set up a private equity
firm, partly backed by JPMorgan Chase, to invest in financial services companies outside the US. Mr Willumstad declined to comment.
The Citi search committee is composed of Mr Rubin, Alain Belda, head of Alcoa, Dick Parsons, chief executive of Time Warner, and Franklin Thomas, former head of the Ford Foundation.
● Citi on Tuesday unveiled a further shake-up of its capital markets operation.
Chad Leat, the group’s US head of credit, and Mark Watson, his European counterpart, are being replaced as part of the reorganisation, which involves the combining of the bank’s equity and debt underwriting and sales.
Citi’s China strategy was led by Chuck Prince, who stepped down as chairman and chief executive ten days ago after the bank revealed it faced up to $11bn of writedowns on its subprime exposure.
The reshuffle follows the departures of Tom Maheras, head of capital markets, and Randy Barker, co-head of fixed income, last month.
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