Wednesday, December 16, 2009

Shitty Citi


The decision came after Citigroup badly misread the financial markets on Wednesday and struggled to sell new shares to pay back its bailout funds.

The new stock is expected to be priced at $3.15 a share — below the $3.25 price at which the government assumed its one-third stake in Citigroup. The Treasury is now expected to retain its stake and try to sell the stock over the next 6 to 12 months.

The trouble with the share sale underscored the lingering worries over Citigroup’s financial health and raised concern that the bank’s eagerness to free itself from government oversight on issues such as employee pay might come at a high cost to shareholders. It also may heighten pressure on Citigroup’s chief executive, Vikram S. Pandit.