Citigroup Posts $8.29 Billion Loss, Announce Split

2009_01_citigr.jpg
Photograph by Richard Drew/AP
Banking giant Citigroup announced its fifth straight quarterly loss—this time, it's $8.29 billion—and described plans to restructure. The NY Times reports, "Citigroup confirmed that it would divide, for management purposes, into two separate businesses — Citicorp and Citi Holdings," and the company's statement read, "We are setting out a clear road map to restore profitability and enable us to focus on maximizing the value of Citi." CEO Vikram Pandit added, "Our results continued to be depressed by an unprecedented dislocation in capital markets and a weak economy."

Citicorp will focus on traditional banking while Citi Holdings will have "riskier assets." Last year, Citigroup's value fell 77% and the company received $45 billion from the federal government. This year, Citi's stock value has fallen 43%. The company's split relieves some people; one told Bloomberg News, "It's one of the first steps towards some positive news and the end of this nightmare." Pandit is expected to depart and former Time Warner head Richard Parsons, who is currently Citi's "Lead Director," is rumored to be the next CEO.

In other banking news, the Senate approved to release the remaining TARP money. Bank of America released its 4th quarter results: It posted its first quarterly loss in 17 years—$1.79 billion—and noted that Merrill Lynch, which BoA is absorbing, lost over $15 billion. BoA will get $20 billion in new TARP money. Could the nationalization of banks be on the way?

Email This Entry


Comments (4) [rss]

they still get bonuses, right?

user-pic

Congress better reenact the parts Glass Steegle act that prhibit banks owning brokerages the second Obama is inaugurated.

Post a comment (Comment Policy)

Tips

Get your daily dose of New York first thing in the morning from our weekday newsletter, now in beta.

About Gothamist

Gothamist is a website about New York. More

Editor: Jen Chung
Publisher: Jake Dobkin

Newsmap

newsmap.jpg

Contribute

Latest Tip:

HOTTTTTTTTTTTTT. Language teachers Alini Brito, Cindy Mauro caught by janitor having naked romp in
[more]

Latest Photo:

Subscribe

Use an RSS reader to stay up to date with the latest news and posts from Gothamist.

All Our RSS

Follow us