Citigroup Inc. has announced the creation of a new Institutional Clients Group comprising Citi Markets & Banking and Citi Alternative Investments. The new division is to be headed by Vikram Pandit, 50, as chairman and CEO.

Pandit joined Citi earlier this year after a firm he founded, Old Lane, LP, a multi-strategy hedge fund and private equity fund manager, was acquired by Citi. Prior to forming Old Lane, Pandit was president and COO of Morgan Stanley’s institutional securities and investment banking business.

In his new role, Pandit will continue to report to the Office of the Chairman. He retains his title as chairman of CAI, and remains a member of Citi’s Business Heads, Operating and Management committees. The appointment is effective immediately. The firm also named a new president and CEO for CAI, and a new co-CEO of the Markets & Banking division.

“This new operating structure will enable us to continue to use our capital actively but in a more efficient way, keep moving towards higher margin businesses, continue to diversify our sources of business, and employ world class talent that has a relentless focus on serving our clients. We have made substantial progress towards these goals. Vikram Pandit is the right person to lead our effort to accelerate that progress,” said Charles Prince, chairman and CEO.