Is Citigroup’s chairman part of the bank’s problem?

April 4, 2011, 4:00 PM UTC

Wall Street’s biggest Citigroup bear has a few words to say about the bank’s chairman, Richard Parsons.

FORTUNE – Mike Mayo is a famously combative bank analyst, a reputation he cultivated in large part by taking swipes at Citigroup ever since the financial crisis began. Unsurprisingly, a recent profile of Citi chairman Dick Parsons was too big a target for Mayo, now an analyst at CLSA, to ignore.

Parsons, 62, became chairman of Citi’s board in 2009. (He also served as president and chief executive of Time Warner, the parent company of FORTUNE, from 1995 – 2008). Bloomberg Businessweek’s recent profile of Parsons suggests that he’s the smooth, cool-headed, master schmoozer that companies call in to clean up their messes. Mayo, however, argues that Parsons is more a master of disaster than a Mr. Fix-it.

“Comments by Citigroup’s Chairman, Richard Parsons, in Bloomberg Businessweek reflect poorly on the company,” wrote Mayo in a recent note. “Citi’s problems are at least partly the responsibility of [Parsons], who had been a board member since the late 1990s.” Citi’s decision to load up on mortgage debt amid the recent housing bubble pushed the bank to the brink of failure in 2008.

Not only does Mayo dislike the fact that Parsons seems unwilling to take responsibility for any of Citigroup’s (C) decisions, he seems particularly upset by Parsons chumminess with Treasury Secretary Tim Geithner, whom Parsons refers to as “Timmy” in the recent magazine profile. “His comments indicate unusual and exclusive access to the US Treasury Secretary… and arrogance about the degree of government support and the degree of negative impact that Citi has had on the entire industry,” Mayo writes.

Mayo has long taken banks to task. His criticism of Citi began in earnest with a downgrade in 2007, and he has since derided the bank for mismanagement, exorbitant executive pay packages, and bad accounting practices. He spent the months leading up to the financial crisis issuing apocalyptic write-off predictions for the bank. Mayo has been such a fervent Citi bear that he makes fierce critics like Meredith Whitney look like boosters of the bank by comparison.

Mayo has some suggestions for Parsons (predictable if you’ve followed the analyst): Focus on Citi’s “possible violation of Sarbanes-Oxley” and “what looks like almost baked-in excessive future compensation for its top managers.”

Far from being the guy to fix Citi, Mayo says that the chairman embodies many of the problems the bank still faces.

Statements about the nation’s reliance on Citi and the bank’s special access to political officials “make the public hate bankers and encourage harsher and sometimes unfair regulatory treatment,” Mayo writes. “At some point, what we consider the bond among the big bank brothers should get broken and the poorly performing banks such as Citigroup get separated from the rest of the industry.”

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