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Citi break up

Citibank is alive

Citibank is alive

Citigroup Inc unveiled a plan to break into two businesses as a way to shed troubled assets, and reported an $8.29 billion fourth-quarter loss, its fifth straight quarterly loss.

The company also said on Friday that it anticipated more departures from its board, which is losing Robert Rubin as a director later this year. Nevertheless, Citigroup shares rose 14.9 percent to $4.40 in premarket trading, in part because of hope about the banks plans to restructure and separate its good assets from its bad ones.

“Its one of the first steps toward some positive news and the end of this nightmare,” said Michael Holland, founder of Holland & Co in New York, which oversees more than $4 billion of assets.

Citigroup posted $28.3 billion of writedowns and credit losses, bringing its total credit losses over 15 months to more than $92 billion.

The banks fourth-quarter loss equaled $8.29 billion, or $1.72 per share, compared with a year-earlier loss of $9.8 billion, or $1.99 a share.

The results included after-tax gains of $3.9 billion from the sale of the companys German retail banking operations.

via Citi loses $8.3 billion, separates into two units | U.S. | Reuters .

Also see Good Bank, Bad Bank

However Citi has been able to create $7 billion in Capital and $2.7 billion in Cash from the Sale of 50% in Morgan Stanley Smith Barney. Morgan stanley can buy additional 15%,15%, 20% in years 2012, 2013 and 2014.

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This entry was posted on January 16, 2009 by in Financial Markets, Meltdown, Uncategorized, US and tagged , .

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