Citigroup May Turn to Alwaleed, China for Cash to Offset Losses

[Purveyor]

Source: Bloomberg News

Jan. 12 (Bloomberg) -- Citigroup Inc., the U.S. bank facing an estimated $4.21 billion fourth-quarter loss, may get cash infusions from Saudi Prince Alwaleed bin Talal and China's government to bolster its capital.

Citigroup, the largest U.S. lender, is seeking a total of $8 billion to $10 billion from investors including Alwaleed, who already owns almost 4 percent of its shares, and China Development Bank, the Wall Street Journal reported yesterday, citing people familiar with the matter. The Chinese bank is likely to invest about $2 billion, the newspaper said.

Separately, the Financial Times today reported that Citigroup may raise as much as $14 billion, including $9 billion from China and $1 billion from the Kuwaiti Investment Authority. A public placement of shares would add another $2 billion to $4 billion, the newspaper said.

Subprime mortgage losses have drained the capital Citigroup keeps as a cushion against bad loans, forcing it to try to sell equity for the second time in two months. The New York-based bank raised $7.5 billion from the ruling family of Middle Eastern emirate Abu Dhabi in December, joining Merrill Lynch & Co., Morgan Stanley and UBS AG in seeking infusions from overseas investors.

``I don't remember a time in history when so many banks were running around the world with hats in hand,'' said Richard Sylla, a financial history professor at New York University's Stern School of Business.



Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aBQfnE6n0A8s&refer=home

[ColbertWatcher]

1. Didn't Dubai already throw money at them?

http://www.latimes.com/business/printedition/la-fi-citi27nov27,1,2422870.story?coll=la-headlines-pe-business&ctrack=3&cset=true">Here is a link from the LA Times.

What is with Citigroup?

[sandnsea]

3. We are teetering on the brink

This would make 1929 look up. And ladeeda they just keep blowing smoke up everybody's ass.

[ooglymoogly]

5. And just like 1929 this one is being planned and manipulated for maximum profit

Big money is already quietly pulling its hoards out of the stock market. The top .01% will then swoop in and buy everything up at 10 cents or less on the dollar. The dollar being already halfway to worthless.Yes this one will be a jaw dropper and perfectly planned by the shadow government that call themselves The Tr!-1oot-eral Com!$$ion.

[flashl]

2. SWFs being investigated

US Lawmakers Focusing On Sovereign Wealth Funds

A U.S. government agency has begun an investigation of foreign state-run investment funds at the request of a Senate panel, as lawmakers examine whether the much-needed capital infusions being provided to major banks pose economic or security concerns.

The Government Accountability Office moved forward this week on an investigation into sovereign wealth funds, including the size and types of investments the funds are making in U.S. markets, a spokeswoman said.

The probe, which was requested by a member of the Senate Banking, Housing and Urban Affairs Committee, also will examine what oversight - both international and in the U.S. - is conducted on the funds and what other countries the funds are investing in.

The GAO study was requested by Sen. Richard C. Shelby, R-Ala, last September. A Shelby spokesman said the Alabama Republican feels "it is important to conduct vigilant oversight and understand the issues associated with the major role that sovereign wealth funds play in the global economy."

The state-run funds, primarily those located in Asia and the Middle East, have made headlines in recent months by acquiring stakes in major banks such as Merrill Lynch & Co. (MER), Citigroup Inc. (C) and UBS AG (UBS), a major Swiss bank with extensive U.S. operations.

Both Merrill and Citi, which already have received billions in cash infusions from the funds, are currently in talks to receive even more capital from outside investors.

Money CNN - Read Full Text

[Paula Sims]

4. I really need reading glasses

At first I read "Citigroup may turn to WEED in China for Cash to Offset Losses". Then again, if desperate. . .

[IndyOp]

6. When Reagan took office we were the greatest creditor nation. Now we are the greatest debtor nation.

- As per Thom Hartmann.

Screwed: The Undeclared War Against the Middle Class <- Thom on C-SPAN
http://www.c-spanarchives.org/library/index.php?main_page=product_video_info&products_id=194612-1&tID=5


Screwed: The Undeclared War Against The Middle Class
http://www.thomhartmann.com/index.php?option=com_content&task=view&id=213&Itemid=102

The American middle class is on its deathbed. Ordinary folks who put in a solid day’s work can no longer afford to buy a house, send their kids to college, or even get sick. If you’re not a CEO, you’re probably screwed.

In his latest book, Air America host Thom Hartmann shows how the American middle class that was so carefully constructed by our country’s founding fathers has been systematically dismantled over the past quarter-century, and, under the guise of “freeing” the market, replaced by a system designed to line the pockets of the super-rich and corporations.

Hartmann shows that it’s not too late to return to the America our founders envisioned. Democracy requires a fair playing field. It will survive only if We the People stand up, speak out, and reclaim our democratic birthright.

[TheFarseer]

7. here's a crazy idea

no dividend this quarter. That would raise over 2.5 billion. Allthough I guess that's still not enough.

[strategery blunder]

8. CEO's have millions of shares, you really think that'll happen?

If the top execs decided to suspend the dividend, they would effectively be taking multi-million dollar paycuts each QUARTER.

You really think that will happen? :eyes:

[Quakerfriend]

9. And, next week all of the big banks- Citi, ML, JPMorgan report

earnings- Get ready for a little rock and roll! I suspect that next week will be a bit bumpier than the last couple for the stock market.

[TalkingDog]

11. Okay....and given the past 2 weeks that means....

what exactly?




My Favorite Master Artist: Karen Parker GhostWoman Studios

[MadHound]

10. This is just plain stupid

Massive borrowing, from the personal level to the institutional level to the governmental level, is what got us into the position we're in to begin with. Why the hell do these people think that doing more of the same is going to help?

[FarCenter]

12. Banks borrow from people who have money and lend to people who don't.

Banking is mainly the business of borrowing money from people who have money at a low interest rate, and then lending the money to people who don't have money.

People in Europe, Asia and the Middle East have money. After running $500 billion trade deficits year after year, people in the US don't have money. Besides which, those in the US who do have money have been investing abroad in order to dodge taxes and avoid the impact of the falling dollar.

A key question for presidential candidates is, "What are you going to do to reverse the trade deficit?"

[ColbertWatcher]

13. The Falling Dollar

Banks borrow from people who have money and lend to people who don't.
Posted by FarCenter

"...those in the US who do have money have been investing abroad in order to dodge taxes and avoid the impact of the falling dollar."

But doesn't that mean those who have money are hurting the dollar by not investing it in America (dodging their taxes)?

[JPZenger]

14. A Saudi Prince Was Already Largest Sharholder

Before these recent events, a Saudi prince was already the largest private shareholder in Citibank, which is the largest bank in the US.