Another Bank Going Down

[Devilmaycry]

WASHINGTON (AFP) - - With Citigroup stock value plunging, top executives at the financial giant are considering the sale of all or parts of the company, the Wall Street Journal reported on its website.

 

The debate within the company is at a "preliminary stage," and officials said the company has "ample capital, funding and strategic direction," the daily said.

 

The sale option is one of a range of dire scenarios company executives were considering after Citigroup stock fell another 26 percent Thursday, after a 23 percent drop on Wednesday.

 

The company's board of directors is expected to meet Friday to discuss options to reverse the stock slide, people familiar with the situation told the daily.

 

Citigroup, a component of the blue-chip Dow Jones Industrial Average, has tumbled more than 70 percent since the start of the year, with the bank hit by hefty writeoffs linked to the US real estate crisis.

 

Chief Executive Vikram Pandit and other company executives have told colleagues they are frustrated and confused by this week's 50 percent stock decline, the daily said.

 

Citigroup stocks on Thursday closed at 4.71 dollars, their lowest level in 15 years, despite Wednesday's announcement by Saudi Arabian investor Prince Alwaleed bin Talal bin Abdulaziz Al Saud that he would increase his holdings in Citigroup Inc. to 5.0 percent, adding that he supports the banking giant's management.

 

At 25.6 billion dollars, Citigroup's value on the stock market is barely higher than the 25 billion dollar aid package the US Treasury extended it last month, in the framework of its 700 billion dollar bailout plan for stricken financial institutions.

 

Besides considering selling the company to another bank, Citigroup executives are also looking into selling parts of the company, including the Smith Barney retail brockerage, the global credit-card division and transaction-services unit, Citigroup's most lucrative and fast-growing businesses, the newspaper said.

 

They are also exploring the possibility of merging with a rival. Some analysts have pointed to Morgan Stanley and Goldman Sachs Group Inc. as potential suitors, market analysts told the daily.

 

Citigroup also want to make it more difficult for investors to place bets that the company's share price will fall, a strategy known as "short selling," and have been lobbying the Securities and Exchange Commission to reinstate a ban on the trading strategy imposed at the start of the stock market crash.

 

Citigroup on Monday announced it was slashing a near-record 50,000 jobs worldwide in further belt tightening to cope with the global financial crisis and heavy losses. At its peak last year, the company employed 375,000 people.

 

It was the second largest job-cut announcement on record, according to global outplacement consultancy Challenger, Gray & Christmas, tying with 50,000 job cuts by retailer Sears, Roebuck & Co. in 1993 behind the all-time largest the same year: 60,000 by IBM.

 

 

So who's holding credit debt on Citibank Singapore[thumbsdown]

[Bobnah]

haha... those on credit debts will be write off ? then quick go and spend dont need to pay lao..

[Furrynadz]

didnt pay and pay just invest in shitty bank

[Acemundo]

i thought temasek invested a lot in them?

[Mustank]

i was given to understand that C's plunge yesterday was due to it buying in doon how much doono what stuff from its sivs

 

i guess it is crazy to do so when C itself needs additional capital

 

but why are the C execs so concern about the share price

 

if share price now is 0.01, how does it affect's C capacity to earn money?

[Babyt]

last time ppl said having a sheetybank saving account very big deal coz need min 5K...is it so hard to save 5K? anyway now look at the bank.....still very big deal bank?

[Bobnah]

Saudi invesments pump $ into Citi group ..think cut loses only

[Acemundo]

my heart bleeds knowing our country's investment in the various banks drop just like that.

[Wt_know]

i still saw citigroup or citibank so called "adviser" & "analyst" being interviewed by CNA to advise retail investor how to manage their portfolio to protect their capital

 

will you listen to a citibank or citigroup a-na-lyst

Edited November 21, 2008 by Wt_know

[Altivo]

share price is a barometer of a firm's health. It the price is super low, it will send out negative signals and everyone will siam it like a leper. By then, how is Citibank gonna make money?

 

Actually, it's kind of self-fulfilling loh. Even without much basis, as long as people believe your firm is going down, they will start dumping your shares to cut losses. With more supply than demand, the price of your share will drop.... then all the more, people would avoid your firm... haiz... endless cycle loh

[Genie47]

At this rate, only sperm and egg bank will be the only ones standing.

[Ticklish8]

From Sharejunction.com....... LOL

 

Temasek did not buy Citigroup, they bought Merrill Lynch, first purchase at USD 48... right now, after the cash rebate + second purchase, their average price is about USD 24.. so, right now, Temasek holding paper loss of 67.5% at least "RIGHT NOW". .. of course they will tell you all the craps that they hold for 10 years.. blar blar blar..

 

GIC bought USD 9.8 billions of citigroup at about USD 28... they did not disclose the real purchase price, but that's the price range when they announce.... won't go too far... so, GIC is holding paper loss of 83.2% right now... as for UBS ... GIC bought SGD 9.75 billions for UBS at about USD 50... so, GIC is again holding another paper loss of 83.12% right now....

 

of course both party will say, they aim for long term... somemore, they might say, oh please.. i only made 1 mistake so far, look at my past 10 years history, how much i earn selling what gas station, power station, i earn how many "Billions"... that's not the point... the point is, as a prestiguous firm, you made such a big mistake, and no one dares to report such news nowadays at the Straits times, i still remember, when they pumped in the money, the news almost everyday say GIC and Temasek is the biggest shareholder.. blar blar blar, every single day, now is just shy away from public....

 

so, they have to learn a precious lesson now... US market is far beyond the small little red dot imagination, don't assume it is always as easy as "ABC"....

[Yr1985]

last time ppl said having a sheetybank saving account very big deal coz need min 5K...is it so hard to save 5K? anyway now look at the bank.....still very big deal bank?

 

Not only sheetybank saving account very big deal last time, their employees also very big deal one, even a small admin can called themselves "sheetybankers". They walk like they are the biggest nation in capital tower during lunch time. I was contract IT under one of such sheetybanker boss, and I left after 4 months when I saw he replaces contract staff because he "don't like the face". Think I wanna pay him a visit and throw the cheapo sheety credit card onto his face.

Edited November 21, 2008 by Yr1985

[Gs300999s]

these days not true, even if a firm a sound and reporting profit, share price still will go south.

 

that is the reason why everyone is advised against entering the share market now as it deemed as a "irrational" market now. Totally relying on sentiments disregarding actual performance.

[Hishercar]

well said

[Alcapone]

lenders may assign their rights, but borrowers cannot.

 

even if the lenders is put under receivership, it is the duty of the liquidators to collect all debts and pay off the creditors and depositors and final proceeds to the shareholders.

 

borrowers cannot run.....................................

Edited November 21, 2008 by Alcapone

[Devilmaycry]

At this rate, only sperm and egg bank will be the only ones standing.

 

Predict next on my list is OCBC....at this rate if they insist on freezing the old lady 8.8 million. Bet they don't have the capacity to pay her back...delay tactics.

[Babyt]

8 million is small sum to the bank lah. if 1 old auntie can deposit 8 million, there would be alot of ppl like her. why would a bank survival depends on 1 single old woman??!

 

anyway, ocbc did the right thing to hold the money. the old lady sld understand why and just go for mental checkup. if she is fine, she will get the money....must be someone behind asking her to sue the bank, manipulating her to do it. the bank did not say they want to confiscate her money so why get so heat up about it.

 

well i think next time im old liao i better withdraw out money in case i go senile and cannot withdraw.