The $166 billion merger that created Citigroup in 1998 was a mistake that failed to benefit the company's investors, John Reed, one of the deal's masterminds, told the Financial Times. (Video: Financial supermarkets a failure?)
Reed, who worked on the pact with Sandy Weill, told the newspaper it was unclear whether the company's model or management deserved the greater share of the blame for its problems.
"The specific merger transaction clearly has to be seen as a mistake," Reed told the Financial Times.
Like many companies in the financial sector, the bank has been battered by bad bets on risky subprime mortgages and the global credit crisis.
In January, Citi announced plans to raise $14.5 billion, slash its dividend and cut 4,200 jobs to shore up its balance sheet after a writedown on mortgages led to a $9.83 billion quarterly loss.
Representatives of the company could not immediately be reached for comment.