Citigroup, one of the ‘too big to fail’ folks, received $25 Billion under TARP. Then subsequently did a deal with the Feds for $306 Billion in US government guarantees for bad mortgages and other toxic assets PLUS $20 Billion as a cash infusion from the US Treasury. In exchange, the US government received $27 Billion in preferred shares that carry a 8% dividend.
Feeling the pain yet, America? It just keeps on getting better and better.
“Citigroup Inc., one of the biggest recipients of government bailout funds, is looking to scale back its U.S. retail footprint to just six major metropolitan areas and limit most lending to wealthy customers, according to a published report….The New York-based bank’s executives are expected in October to present plans to the board of directors to pare Citi’s retail branch network and concentrate mainly on the New York, Washington, D.C., Miami, Chicago, San Francisco and Los Angeles areas, the paper said….
While the moves would be designed to help the bank work "smaller-but-smarter," the paper said some Citi executives are concerned that the U.S. government, which owns a 34 percent stake in Citi, could balk at branch closings.”
Is THIS what the US economy really needs? Talk about ‘biting the hand that feeds you,” – anyone else out there feeling a tingle in your hands this morning? Mine’s pretty well bandaged these days.