Apparently the subprime mortgage crisis has claimed its second CEO victim.  Less than a week after Merrill Lynch CEO E. Stanley O'Neal resigned, Citigroup CEO Charles Prince announced his resignation.  As the Washington Post reports, last month Citigroup reported a 57% decline in profits and $6.5 billion in write-offs, both stemming from losses in the company's mortgage-backed securities business.  Similarly, O'Neal was forced out after acknowledging $7.9 billion in write-downs related to mortgage-backed investments.  Indeed, the company reported the biggest losses in the firm's history.  To be sure, these CEOs have different stories.  However, the crisis in the subprime mortgage market made the outcome of their stories the same.

Indeed, Prince's time at Citigroup has been anything but smooth as, despite Prince's efforts, the company's stock price has declined during his tenure and the company has lagged behind its peers.  By contrast, last year, O'Neal was being celebrated.   His admittedly risky investment strategy appeared to be paying off as Merrill posted impressive numbers, and seemed to be an acknowledged leader in its field.  But this past success was not enough to overcome the most recent crisis, and O'Neal was shown the door. 

In the end, one could offer a variety of different reasons for the down-fall of these seemingly different CEOs, reasons ranging from leadership styles to the nature of their decision-making.  Yet the fact that both leaders suffered the same fate seems to suggest that it is not about the leaders at all; rather it is simply difficult to be at the helm of a company when it is hit with significant losses.  Which of course does not bode well either for the CEOs tapped to replace O'Neal and Prince or the CEOs in this industry that are still standing.

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