Citigroup (C) Looking To Spin Off Oil Trading Unit

Citigroup (NYSE: C) is looking to sell a controversial oil trading unit where the star trader could collect as much as $100 million this year, according to Vikram Pandit, the chief executive and the FT.

Pandit indicated that Citi wanted to reduce its ownership in the unit, called Phibro, and get it to manage money from outside investors. Currently, Phibro, which is run by Andrew Hall, trades with Citi’s capital.

"We have been looking at the possibility of transforming [Phibro] from what it was, a proprietary trading [unit] to an asset manager," Mr Pandit told a New York audience.

Vikram did not provide additional details, but when someone asked him whether a $100 million compensation package was excessive for anyone on Wall Street, he replied "Yes".

Kenneth Feinberg, the government’s pay "czar", has to approve the compensation packages of Citi’s 25 best paid employees.

Phibro has actually been very profitable for Citi and is believed to have had profits of approximately $600 million last year.
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