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U.S. to Take Big Citi Stake and Overhaul the Board [Nationalized!]
The Wall Street Journal ^
| 2009-02-27
Posted on 02/27/2009 5:43:05 AM PST by rabscuttle385
BY KEVIN KINGSBURY AND MAYA JACKSON RANDALL
Struggling banking giant Citigroup Inc., moving aggressively to shore up its equity base, announced a stock swap Friday that if successful will leave the government owning more than a third of the company and wipe out nearly three-quarters of existing shareholders' stake.
The move is an acknowledgment that more than $50 billion in government capital and a backstop on more than $300 billion in troubled Citigroup assets haven't been enough to stop the bank's slide. It also represents a deepening of the government's role in trying to prop up the U.S. banking sector.
Under the deal, Citigroup said it will offer to convert nearly $27.5 billion in preferred stock sold to private investors and the public and up to $25 billion in preferred stock bought by the government into common stock. The exchange, if fully executed, would leave the U.S. government with 36% of the bank's shares. Existing shareholders' stake would be cut to 26%. Shareholders will have to approve much of the common stock issuance.
Additionally, the government is demanding that the company overhaul its board of directors. Citigroup's board will soon include a majority of new independent directors, the company said Friday. Chief Executive Vikram Pandit is expected to keep his job under the agreement.
The bank's stock plunged on the news.
(Excerpt) Read more at online.wsj.com ...
TOPICS: Breaking News; Business/Economy; Government; US: Nevada; US: New York; US: Ohio; US: South Dakota
KEYWORDS: bho2009; bho44; bhoeconomy; citi; economy; fascism; fdicfriday; financialcrisis; nationalisation; nationalization; obamasfault; panicof2009; socialism; socialistagenda
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To: rabscuttle385
I should add with the government’s demands, this is effectively nationalization even with less than 50 percent ownership.
Really frightening.
41
posted on
02/27/2009 6:48:34 AM PST
by
rwfromkansas
("Carve your name on hearts, not marble." - C.H. Spurgeon)
To: livius
Yep. Citi will become the ‘public’ financial backbone of all the force income mortgages ACORN will push, and the BoD will be a bunch of ex-gov’t socialists.
42
posted on
02/27/2009 6:48:39 AM PST
by
rintense
(Go Israel!)
To: rabscuttle385
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 10/13/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 10/31/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 11/15/06
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 09/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 09/30/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 09/15/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 09/30/06
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 10/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 10/31/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 11/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 11/30/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 01/14/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 01/31/05
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 01/13/06
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 01/31/06
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 02/15/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 02/28/05
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 02/15/06
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 02/28/06
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 03/15/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 03/31/05
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 03/15/06
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 03/31/06
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 04/15/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 04/29/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 04/14/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 04/28/06
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 05/13/05
Charles Johnston (CITIGROUP GLOBAL MARKETS/Senior Exe), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 05/31/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 05/15/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 05/31/06
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 06/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 06/30/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 06/15/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 06/30/06
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 07/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 07/29/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 07/14/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 07/31/06
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 08/15/05
Charles Johnston (Smith Barney/Senior Executive Vice), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 08/31/05
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 08/15/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 08/31/06
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 12/15/05
Charles Johnston (Smith Barney/Sr. Executive Vice Pre), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 12/30/05
Mark Hutchinson (Citigroup Global Markets/Financial), (Zip code: 60010) $5000 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 12/30/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 11/30/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 12/15/06
Charles Johnston (Citigroup Global Markets/Chief Exec), (Zip code: 60010) $208 to CITIGROUP INC. POLITICAL ACTION COMMITTEE-FEDERAL (CITIGROUP PAC-FEDERAL) on 12/29/06
Look at the Zip Codes on all of these contributions!
http://www.city-data.com/elec2/06/elec-BARRINGTON-IL-06.html
Citibank PAC gives pretty evenly to Dems and Republicans, overall, but they HEAVILY favor Democrats, in the House races:
http://www.opensecrets.org/pacs/pacgot.php?cycle=2008&cmte=C00008474
43
posted on
02/27/2009 6:55:16 AM PST
by
Kansas58
To: rabscuttle385
The average Obamaidiot says, “Whoopeee!!! I've always wanted to own a bank. Free lunch for everyone!
What???
You mean it doesn't work that way?...”
44
posted on
02/27/2009 7:16:16 AM PST
by
444Flyer
(Don't beLIEve Obama.............................Never give up, never give in, never give out!)
To: All
45
posted on
02/27/2009 7:16:47 AM PST
by
KevinDavis
(No one should question our "Dear Leader"!)
To: concerned about politics
I don’t believe that is his birth name. IIRC, it’s his step father’s name. Not that that is important in the midst of all of these changes to fascism.
46
posted on
02/27/2009 7:16:55 AM PST
by
twigs
To: concerned about politics
Byrd, regardless of what else you might think of him, is a constitutional expert. He knows what he’s seeing.
47
posted on
02/27/2009 7:18:06 AM PST
by
twigs
To: Wolfie
Actually I think this could be a great job for a corporate raider.
Split off the investment portion (Smith Barney etc.) and sell it off to someone like Charles Schwab.
Take the credit card division and sell it. Or sell it off in pieces for that matter.
The retail bank branches? Sell them off in regional chunks to banks that could use more branches in that area.
48
posted on
02/27/2009 7:21:30 AM PST
by
RockinRight
(How do you like your Savior now, libs? Looks like Jimmy Carter is no longer the worst President...)
To: livius
I think they will also start replacing executives with their hand-picked personnel, too.
Given that Citi was run by Robert Rubin not too long ago, I would suspect that there are a lot of Democrat party hacks on the board already.
49
posted on
02/27/2009 7:23:52 AM PST
by
Antoninus
(License is the ability to do whatever you want. Freedom is the right to do as you ought.)
To: twigs
The fact is we don’t really know what his birth certificate name is.
50
posted on
02/27/2009 7:24:31 AM PST
by
nanetteclaret
(I REFUSE TO PANIC. "In thee, O LORD, do I put my trust: let me never be put to confusion" Psalm 71:1)
To: Kansas58
I think this PAC break down is very important:
http://www.opensecrets.org/pacs/sector.php?txt=F01&cycle=2008
Even if they try to say that the political contributions are evenly split between R's and D's -— the PUBLIC thinks that EVERYONE In “financial services” or “banking” or “securities” is a Democrat. Even getting the public to think it was 50/50 is a BIG political win.
And, if you get into the companies that went under, like Lehman Brothers, or Fannie and Freddie, they were heavily biased towards Democrats.
We need to pound every sitting Democrat with this stuff, since our candidates, in November 2010, probably will NOT have the same list of contributors. (because they are new to the Federal races, or because some of these PAC’s must tank, along with their sponsoring companies.)
PAC Contributions to Federal Candidates
Election cycle: 2008 2006 2004 2002 2000 1998
Total Amount: $62,389,499
Total to Democrats: $31,104,932 (50%)
Total to Republicans: $31,279,567 (50%)
Number of PACs making contributions: 466
Accountants: $5,881,972 (I think we can be proud of this)
41% to Dems / 59% to Repubs
Commercial Banks: $9,946,288
46% to Dems / 54% to Repubs
Credit Unions: $2,862,074
55% to Dems / 45% to Repubs
Finance/Credit Companies: $3,200,328
53% to Dems / 47% to Repubs
Insurance: $18,288,091
49% to Dems / 51% to Repubs
Misc Finance: $2,061,302
45% to Dems / 55% to Repubs
Real Estate: $9,951,730
54% to Dems / 46% to Repubs
Savings & Loans: $610,995
56% to Dems / 44% to Repubs
Securities & Investment: $9,586,719 (This one is telling)
55% to Dems / 45% to Repubs
Based on data released by the FEC on February 09, 2009.
51
posted on
02/27/2009 7:26:14 AM PST
by
Kansas58
To: rwfromkansas
To: twigs
Byrd, regardless of what else you might think of him, is a constitutional expert. He knows what hes seeing.Yes. Oboma is over riding the Separation of Powers and declaring himself dictator. Even a kook like Byrd sees the danger in this.
To: Shannon
“The big O can put Barney Frank in as president of Citis board then everything will be just fine.”
Bwaney Fwank will rename it “Citi-boink.”
54
posted on
02/27/2009 7:50:42 AM PST
by
Towed_Jumper
(Stephen Hopkins: Founding Father who had Cerebral Palsy.."My hand trembles, my heart does not.")
To: rabscuttle385
But, but, but... I thought they weren’t going to nationalize the banks. A rose by any other name..
55
posted on
02/27/2009 7:55:57 AM PST
by
GOPJ
(People who can't use the new WH phone system are trying to redesign half the US economy - Brooks)
To: rabscuttle385
Time for me to get out from under that mortgage.
56
posted on
02/27/2009 8:05:46 AM PST
by
ElkGroveDan
(Reagan is back, and this time he's a woman.)
To: potlatch
57
posted on
02/27/2009 8:12:19 AM PST
by
devolve
(-- It's not like Hussein is a confessed cokehead --)
To: rabscuttle385
58
posted on
02/27/2009 8:12:53 AM PST
by
Miss Didi
( "After all...tomorrow is another day." Scarlett O'Hara, Gone with the Wind)
To: Antoninus
I’m sure it’s stuffed with Dem functionaries or at any rate, people connected to them in some way. The mystifying thing is that a lot of bankers in general probably voted for Bambi and the Dems. I honestly don’t know what they expected to happen. Granted, he wasn’t entirely upfront about his program, but there were certainly enough slips of the tongue to alarm anybody who was listening.
59
posted on
02/27/2009 8:22:24 AM PST
by
livius
To: conservativehistorian; silverleaf
60
posted on
02/27/2009 8:25:47 AM PST
by
Deo volente
(Freedom went out not with a bang, but with a "stimulus".)
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