Citi in Talks With Government
Sunday, February 22, 2009 21:54The WSJ is reporting that the US government is in talks with Citigroup in a deal which would include the government buying a 40% stake in the troubled bank. ChartingStocks.net was the first to report that the government would be taking Citigroup and Bank of America over.
Financial Times said Citigroup is pressing the U.S. government to agree on a new capital injection that would increase the authorities’ stake in the bank to about 40 percent, but “stop short of an outright nationalization.”
Last Thursday we reported that the announcement could come within days, and also mentioned that even if the banks become nationalized, they may not actually call it “Nationalization.” When a government becomes the largest shareholder of a company, what would you call it??
Related posts:
chris says:
February 23rd, 2009 at 7:52 am
Oh please! Lets face it, you were calling for the end of Citi the other day, toal fear driven to promote your short position. And today your are trying to define nationalization to benefit your opinions. Which I would call spreading fear, as well all know banking is 100% confidence as the insurance sector is. Both industies could never handle all ther investments called in at once or withdrawn at once. In my opinion you are working against our govt’s fight to save this financial system, which is the backbone of our economy. This was released from OUR Treasury dept this morning…..
“Currently, the major U.S. banking institutions have capital in excess of the amounts required to be considered well capitalized. This program is designed to ensure that these major banking institutions have sufficient capital to perform their critical role in our financial system on an ongoing basis and can support economic recovery, even under an economic environment that is more challenging than is currently anticipated. The customers and the providers of capital and funding can be assured that as a result of this program participating banks will be able to move forward to provide the credit necessary for the stabilization and recovery of the U.S. economy. Because our economy functions better when financial institutions are well managed in the private sector, the strong presumption of the Capital Assistance Program is that banks should remain in private hands.”