Citigroup completes agreement with US government
Citigroup says it finalized exchange offers with the U.S. government under which the latter will exchange up to $25 billion of Citi preferred securities for interim securities and warrants.
Citigroup said in February that it wanted to offer investors the option of exchanging preferred stock into common stock. The move would give the U.S. government a 34 percent stake in the New York-based bank.
The deal would boost Citi’s common equity, a benchmark the government is using to measure a bank’s ability to manage losses.
The government has invested a total of $45 billion in Citigroup through its Troubled Asset Relief Program, or TARP.
The public exchange will expire June 24, subject to an extension by Citi.
via Associated Press / Google News
Sheila Bair, the chairman of the Federal Deposit Insurance Corporation, on Tuesday addressed Citigroup’s board in an effort to defuse tensions sparked by the regulator’s push to replace Vikram Pandit as chief executive.
People close to the situation said Ms Bair called for an end to squabbling between the two sides, reminding the bank that the FDIC is carrying out its normal regulatory duties. Ms Bair did not address Mr Pandit’s position, in spite of her widely reported desire to see him replaced by someone with greater commercial banking experience. Citi and the FDIC declined to comment.
People with knowledge of the meeting said Richard Parsons, Citi’s chairman, also struck a conciliatory tone. ( as reported in Finanncial Times, N Y Times et al)
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