Citigroup is unlikely to pursue a major change in strategy following the expected resignation of Chuck Prince, chairman and chief executive, according to people close to the bank.

Some investors hope the departure of Mr Prince could lead to a change of strategic direction, including disposals or even a full-scale break-up of the group. However, members of the board have strongly supported keeping the group together and close observers think any significant shift is highly unlikely.

Mr Prince told close colleagues he intended to resign at an emergency board meeting yesterday that was called to consider his future and further losses the company faces on its holdings of mortgage-backed securities, according to people with knowledge of his plans.

Mr Prince's decision followed last week's ousting of Stan O'Neal as chairman and chief executive of Merrill Lynch, after an $8 billion (€5.5 billion) writedown on its mortgage-related holdings. Critics of Mr Prince had hoped that the departure of Mr O'Neal would embolden Citi's directors to press for a change of leadership.

Robert Rubin, the former Treasury secretary who sits on the board and has been Mr Prince's closest adviser, is likely to head the company until a permanent successor is appointed.

Citi's shares fell 11 per cent last week as analysts increased estimates of the losses it is facing on mortgage-backed securities. Mike Mayo, Deutsche Bank analyst, on Friday predicted Citi could be hit with another $4 billion of write-offs in the fourth quarter. Speculation about Mr Prince's future has mounted since the company announced a 57 per cent slump in third quarter earnings after $3.3 billion of writedowns and credit trading losses.

Citi declined to comment.