Citi-FRAUD
Crisis? What crisis?
Commentary: Citi’s Pandit and B of A’s Lewis diverge in damage control
By MarketWatch
Last update: 9:19 a.m. EDT March 10, 2009Comments: 116
NEW YORK (MarketWatch) — Vikram Pandit, the chief executive brought in to manage the troubled Citigroup Inc., is sticking to his well worn line that not only is the bank in fine shape, its main problem is that its undervalued.
“Despite the steps we’ve taken to strengthen our capital base, I am, like you, disappointed with our current stock price and the broad-based misperceptions about our company and its financial position,” Pandit wrote in a memo to employees Monday. “I don’t believe it reflects the strengths of Citi (C:
2.81, -0.14, -4.7%) ; our newly strengthened capital base, our unique global franchise.” Read Citi memo.
To Pandit, Citigroup’s $1 share price is the result of investors who are mistaken about Citigroup’s ability to ride out the recession. He claims Citi has been profitable so far in 2009, but it’s a hollow hope that almost fully ignores four separate government interventions at a cost or commitment of close to $400 billion and a dilution of existing shareholders.
Up to a third of Citi could be owned by the federal government under the latest bailout announced a few days ago.
The reality at Citigroup is so bad that Bank of America Corp. (BAC:
7.58, -0.12, -1.6%) chief executive Ken Lewis has defended his bank by distinguishing its performance against Citigroup. He suggests B of A will not need more government money and that the bank’s acceptance of $20 billion to buttress its acquisition of Merrill Lynch & Co. was a strategic mistake that eroded confidence.
Another small detail, Lewis says, B of A made $4 billion last year. It’s a claim Citi, which lost $32 billion, can’t make.
Neither bank is in an enviable position. Pandit’s multiple claims that Citi is stable are undermined by the multiple rescues required to prevent panic. Bank of America’s misstep with Merrill has proven nearly as costly.
It may be “broad-based misperceptions” to Pandit, but it’s reality to investors in these institutions.
- David Weidner
Either purposely or incompetently The Resident cut a real bad deal for you the taxpayer already on Citi-fraud. Coincidence?
Look who is movin on up to the Treasury! Coincidence?
http://online.wsj.com/article/SB123732747181462245.html
US of Citi-fraud, Coincidence??
http://www.americablog.com/2009/02/united-states-of-citibank.html