Word: citigroup
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...same is not true south of the border. Under the best-case scenario in the U.S., unsteady financial institutions will need to off-load toxic assets to Washington's "bad bank" in order to start rebuilding balance sheets. Others, like Citigroup and Bank of America, that are teetering on the brink of insolvency will need new capital just to remain on life support. (See 25 people to blame for the financial crisis...
...exception is Citigroup. Since the bank struck a deal with the government to shield $301 billion in losses, we had to account for some investment missteps to value the arrangement. Bank of America has a similar deal, but since the details aren't public, we didn't factor it in. (See pictures of the top 10 scared traders...
...Citigroup Loan losses: Even after making a government deal, the bank is still on the hook for the first $40 billion in loan losses in the pool it has insured. Citi also has $277 billion in other, nonhousing consumer loans, such as credit cards and student debt. Roubini estimates that about 17% of consumer loans will go unpaid nationwide. That translates into a $47 billion river of red ink. Add in everything else (commercial real estate, corporate loans), and Citigroup will have to swallow $106 billion in loan losses...
Much of the crisis in the banking industry has been blamed on the inaction of the boards of directors at companies including Bank of America (BAC) and Citigroup (C). Some of Citi's most prominent members have left, probably not entirely of their own volition. The board at B of A has been savagely attacked over the last several weeks because it did not insist on better due diligence in the buyout of Merrill Lynch and for allowing large bonuses to be paid to employees after the firm had taken TARP money...
...tiered program, with extra restrictions applied to basket cases like AIG, Citigroup and Bank of America, all of which tapped the federal till for hundreds of billions of dollars to recapitalize their broken balance sheets. In addition to the cash limit, the "maximum wage" plan allows companies to reward "senior management" - a complement of no fixed definition - with restricted stock, but it can only be cashed in after the government is paid back. There are also prohibitions against golden parachutes as well as a clawback provision - the company may reclaim that stock if its results subsequently tank - that can extend...