This doesn’t immediately strike me as a Vikram Pandit joint. I am waiting for the deposed chief executive of Citigroup at Felidia, a restaurant on 58th street, just below the Upper East Side in Manhattan.

Sipping a glass of champagne, one woman is telling another how she recently blacked out in a hotel room – “That really freaked me out” – before praising her hairdresser Alessandro.

In bounds the wonkish, wiry Indian-born financier, who contrives to look both uncomfortable and confident in most settings. I doubt he cares about his hair even though, like his navy blue suit, it is neat, and he certainly won’t be blacking out on the fizzy water we order. In an industry where some still knock back the booze, Pandit rarely drinks and declines my suggestion of wine.

Illustration by Luke Waller of Vikram Pandit
© Luke Waller

The 57-year-old has not given an interview in almost two years since he was ousted as chief executive of Citi. At any large US company, where supine boards are often the order of the day, this would have been an unusual event. At a bank that used to be the biggest in the world, and whose operations span 100 countries, it was stunning. Perhaps this explains why both Citi and Pandit have maintained their separation was amicable.

Pandit has popped up in public only occasionally since then. Holed up in an office a spitting distance from Citi’s Park Avenue headquarters, he has been working on a variety of projects that he hopes will seize the zeitgeist of behavioural economics and the future of finance.

He opens up warmly, talking about his two children, who have finished college for summer. His daughter Maya wants to be a psychiatrist and is spending the summer as an intern before returning to her studies at Columbia University, Pandit’s own alma mater, where he studied engineering, then economics, after arriving from India in 1973.

And what of his son, Rahul, who is studying at Harvard? Has he found summer work? “I won’t tell you where he’s working but it is at a suitable place where they let him home at one o’clock in the morning.”

Not one of your former institutions?

“I can’t go there.”

Oh, go on.

“I can’t go there.”

It’s Morgan Stanley isn’t it? I guess.

“It’s definitely not Citi!”

Pandit’s son is, it turns out, spending the summer at Morgan Stanley, in the capital markets division where his father worked from 1983 to 2005, rising to become the investment bank’s president.

“He [Pandit’s son] talked to the Morgan Stanley folks and he said, ‘I liked the fact that they were just more gentlemanly. They seemed to be very smart but they had an easy style about them and there was something about the culture.’ As I reflected on that later, it seems natural. Global capital markets were the areas we built back in ’83. We built it a certain way . . . and I raised him.”

We peruse an extensive Italian menu in silence for a couple of minutes. Pandit has lived in the US for 40 years but it is hard to imagine him being much slimmer as a 16-year-old new arrival from Nagpur. He seems to summon only rather unconvincing interest in the food: “That sounds good . . . That sounds very good doesn’t it?”

He orders “beetroot . . . I won’t even pronounce it . . . ” – “Barbabietole,” the waiter offers then, seemingly appalled by his own apparent mispronunciation, says: “I mean, uh, barbabietolei” – followed by salmon. I go for the shaved raw fish with vegetables and then veal.

Freed from Citi, Pandit has had 18 months to plot his next move. “It’s nice to not have any compulsion or time pressure to figure out what you want to do. I’ve been through transitions before and every time people have said, ‘Take your time to think about what you want to do.’ And this is the first time I have.”

And has he decided?

“Erm, I think so.” Pandit dabs some bread ruminatively at an amuse-bouche of cannellini beans and pesto sauce, which he genuinely seems to appreciate because he grazes on it throughout the meal.

“For a large group of people who grew up over the past two, three, four decades, they’ve been in a very different world – it was a world of predictable growth, it was a world of the ability to finance yourself, it was a world where you could really put one foot in front of the other. You find people grappling with what’s the new sustainable model for growth. And that is true of countries, it’s true of businesses.”

At the same time, Pandit proclaims that, largely thanks to technology, “It’s never been easier to start your own business.”

Our starters arrive. Beetroot and ricotta for Pandit while I get a plate decorated with delicious oily slivers of fish and vegetables offset by the occasional crunch from puffed rice and bite of horseradish.

“Bon appétit,” says Pandit, as he slices into a beetroot and continues to extol the virtues of something he calls the “SMAC stack”. I tell him this sounds awful but, he assures me, “it’s the vernacular for the ease for which you can get into business today,” and it stands for “Social media, Mobility, Applications and Cloud.

“Data is like . . . You’re too young, but there was a movie with the [line about] plastics.” When I assure him I’m familiar with The Graduate, he says: “Data is this generation’s plastics. I don’t see business models being truly successful until you get it.”

Pandit has a fondness for big concepts and management-speak and it can be difficult to bring him down to earth. I press him for examples. “You have large auto companies saying, ‘Where is the growth?’ and, on the other hand, you have a SMAC stack that’s created Uber. What’s interesting is that all those intangible abilities are inside the auto companies to make it happen.”

He has been investing in a steady stream of companies that he thinks embody innovative ideas that might make them the next Uber, the suddenly ubiquitous taxi-ordering app. At the same time, he is chairman of TGG Group, a consulting company set up by Steven Levitt, co-author of pop economics book Freakonomics – which aims to help corporations unlock their inner Ubers.

Starters cleared away, Pandit isolates a small breadcrumb in the expanse of white tablecloth and tweezers it between his finger nails. Behavioural economics, he says, provides an “uncanny ability to predict how you’re going to behave”. Levitt, best-known for a book which explores the business model of drug-dealers and cheating sumo wrestlers, is applying his analysis of human behaviour to companies in ways that “will be in textbooks in 10 years”.

As the main course arrives, I realise we have been given the wrong knives and persuade Pandit to swap his vicious-looking sawtooth blade for my gentler-looking fish knife. As we chop into our respective dishes, I finally broach directly the question of Citi.

Its former chief executive says he is proud of his part in an “extraordinary five years for the company” – which is putting it mildly. Between 2007 and 2012, under his stewardship, Citi became the biggest bank bailout in the US, with the government injecting $45bn to keep it afloat and, at one point, even considering outright nationalisation.

Pandit took the job in December 2007, with the financial crisis already brewing. His predecessor was Chuck Prince, who infamously said, “As long as the music is playing, you’ve got to get up and dance.” When the music stopped, Citi was stranded on the dance floor. Pandit inherited a bank teetering under big bad bets on mortgage securities. Fighting for the company’s survival, he cut a staggering 100,000 jobs, more than a quarter of the workforce.

Today he prefers to concentrate on other parts of the clean-up he orchestrated, such as offloading $180bn of mostly toxic assets. “That’s one of the largest restructurings in corporate history. The bank has enormous financial strength and we re-established profitability faster than anybody thought. I feel very good about setting the direction. I’ve no regrets about anything I did at Citi.”

But it wasn’t sufficient for the board, for whom the recovery was not coming fast enough. On October 15 2012, in a conference call with analysts, Pandit announced improved results. Later that day, he was summoned by the chairman, Mike O’Neill, to be told the board had lost confidence in him.

At the time, Pandit and the company chose to say he was resigning voluntarily and he is still toying with that version of events today. “You know, it was time for change. The turnaround was largely done. The transformation was well along the way. I think it was time,” he says, before allowing: “Now, I think the abruptness probably didn’t serve anybody well but that’s behind us.”

I suggest that he did not want to leave. “Hmm, believe me, it was clearly time for change and I had been thinking about it . . . As I said, leaving aside the abruptness of the departure, I had a great time.”

This is as close as he will get to admitting that, in effect, he was fired and that it was a decision that shocked the bank’s employees. Eighteen months on, Citi’s profits are slowly improving but there are still run-ins with regulators, including failing Federal Reserve stress tests for a second time.

“They’re sticking to their knitting,” he says. “They’re doing as well as they can. I can’t imagine it’s got any easier than when I left.”

Pandit’s desire to do something completely different is plausible. Indeed, his fiercest critics, among them Sheila Bair, the formidable former US financial regulator, have long argued that Pandit’s background in hedge funds and investment banking meant he did not have the right experience to run a mammoth universal bank.

“I don’t judge anybody for any opinions they express at times of stress,” says Pandit. I remind him that Bair has reiterated the opinion at entirely relaxed moments, including in her book Bull by the Horns (2012), where she said the board “could have done so much better”, but he refuses to rise to the bait.

Pandit’s supporters, such as Robert Rubin, the former Treasury secretary who used to be on the Citi board, saw him as a “strategic thinker”. In order to lure him to the bank, Citi paid $800m for Pandit’s hedge fund Old Lane – Pandit himself pocketed $165m from the sale.

Even his critics acknowledge his intelligence and intellectual curiosity. It is not surprising that he is likely to feel more at home outside a banking industry only sluggishly recovering from the financial crisis and bogged down by new regulations.

“If you look at big banks 100 years ago, they were a vast part of the financial market,” he says. “Today they are a very small part. We’re in the early innings of watching the financial system develop.”

Accordingly, while many of Pandit’s new investments are financial companies – Orchard, a platform for users to trade loans; CommonBond, a student lending platform; Fundbox, which lends money to small businesses against their invoices – only one, in India, has any aspirations to be a traditional bank.

With many of his new interests, Pandit says he is looking to remove “frictions”, which happen to be the way Citi and other banks make their money: for example, the middle men that sit between a big bond manager and retail investors and charge a fee. As he points out, the wealthiest individuals are not saddled with these costs to the same extent.

“If you are a large, wealthy multi-billionaire you can put that into an M&A transaction and earn 15-20 per cent. If you’re an ordinary American you earn 2 per cent on your investments. That disparity has to be democratised. It’s now possible to take those frictions out. That is an important concept because it expands the number of people who are in the financial sphere. That has a positive growth impact. At the same time it is about unmet needs.”

His pitch is that technologically-savvy financial start-ups can squeeze the banks and bring down financial costs, though he concedes there are only nascent signs of this happening.

I ask how he finds his investments. “I have an office and it’s Grand Central Station: everyone comes through there. That shouldn’t be surprising,” he adds matter-of-factly. “That’s just the nature of things.”

A waiter enquires about desserts. Pandit will have chocolate tiramisu and an espresso. I take panna cotta and a double macchiato. When our choices arrive, he invites me to try some of his, saying, “Yummy, dig in.”

Returning to our theme, I refer to the growing concern about “shadow banking”, finance that exists outside regulated banks. But Pandit is an advocate. “If you can create the lending required for small business at a much lower rate of leverage [fuelled by less debt], then you want to try to see if that can work. If you want the ability to move money around at much lower rates, then you ought to see if that can happen. I’m very optimistic. The important thing is to look to the future. We’ve got work to do.”

Yet it strikes me that while Pandit’s eyes are fixed forward, part of his mind is still churning through the events of the past. “We know how to create a virtual Citi from the outside. Wouldn’t that be an interesting thing?” he says, and it’s apparent that though his financial start-ups are at the cutting edge, he thinks about them with reference to his former employer.

The bill arrives and, without thinking, I take out a Citi credit card to pay. Pandit seems pleased. He still has a lot of his wealth tied up in Citi stock, though he will look to sell if it rises a couple of dollars.

“Wishful thinking,” he muses.

Tom Braithwaite is the FTs US banking editor

Illustration by Luke Waller

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