CITIBANK was bailed out by the American government on 24th November 2008.
Marketwatch.com reports:
Citi soars, but reactions are mixed on U.S. plan
Bailout includes government approval of compensation, limits on dividends
Early Monday morning, officials agreed to a $326 billion rescue of the company that was once the largest U.S. bank, a pioneer of the one-stop-shop model combining financial services for business and consumers.
The government intends to invest $20 billion in Citigroup and to guarantee as much as $306 billion of its troubled assets in a deal reached late Sunday evening. The agreement also gives the government control of executive bonuses and places limits on dividend payments. The deal would likely make the government the largest Citi shareholder. The United States will end up with a 7.8% stake in Citigroup, Chief Financial Officer Gary Crittenden told CNBC.
Three weeks later, it was revealed that Citibank has been bailing out the Dubai Goverment with a $8 billion loan over a period of six months. A Financial Times report said:
Citigroup has arranged more than $8bn (€5.9bn, £5.3bn) of financing over the past six months for Dubai’s state-linked companies as the indebted emirate seeks to chart its way through clogged-up credit markets. Win Bischoff, Citigroup’s chairman, said yesterday that the financing underscored the bank’s positive outlook on Dubai, in spite of recent Citi research which said that the region’s commercial hub was the most vulnerable economy in the oil-rich Gulf because of its exposure to real estate and debt. The research sparked dismay among Dubai officials.
“We certainly see opportunities across the UAE’s financial sectors,” he said. The announcement was a much needed boost for Dubai, pointing to banks’ willingness to lend to the emirate even as the slowdown in the emirate’s real estate and services industries sectors continued. But bankers remained sceptical because of a lack of details about the Dubai entities that had benefited from the loans and their terms.
“This appears to be a historical account of what has already been done,” said one banker. Citi declined to comment.
Dubai’s biggest ticket financing in the past few months has been the $6bn syndicated loan to Investment Corporation of Dubai, the state holding company, to which Citi is said to have contributed $500m. The US bank was also involved in a financing arrangement over the summer for Dubai Aerospace Enterprise, an aviation services company including leasing, manufacturing and repair services. Other media reports last month also suggested the bank was seeking to sell on at a discount some of its exposure to Dubai debt.
How can Citibank or the Government of United States, which holds 7.8% in teh Citigroup – explain Citi’s spending in Dubai?
Americans proved it in 2000 that they really don’t care about democracy at home as much as they care about democracy in the Middle East. Now the silly Tax Payers of the US have proved that more than bailing out themselves, it is better to bail out the Middle East!
How come CITIBANK is still operational when Lehman Bros had to close shop?
Latest Update on CITI, 13 January 2009
Citibank declined to comment whether or not the company was a client of Satyam and whether the bank had given details to RBI.”We are unable to comment due to client confidentiality,” a spokesperson said.
FORBES.com has an interesting report:
Citi On Fire?
Investors flee Vikram Pandit’s megabank, fearing it may be in worse shape than ever.
Anxiety about the fate of Citigroup is growing.
Investors fear the company may need more assistance from the federal government to stay afloat, even after regulators organized a $20 billion bailout in November, including a guarantee of $300 billion in loans on Citi’s books. That came in addition to the $25 billion in funds Citi received from the Treasury’s Troubled Asset Relief Program in October.
This bail out circus MUST come to an end.
