Citigroup may be considering a merger
A Citibank branch in Washington, D.C.
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Scott Jagow: As for Wall Street, bank stocks are dirt cheap, but no one's touching them until they find out about Citigroup. Rumors are flying that Citigroup might sell itself or look for a merger. The company denies that, but Citi's board is expected to meet today. Marketplace's Janet Babin reports from North Carolina Pubic Radio.
Janet Babin: Back in the day, Citigroup was the largest bank in the U.S. Now, it's down to number five. The bank's shares have sunk to their lowest level in more than a decade.
Christopher Whalen of Institutional Risk Analytics says investors are worried that Citigroup will have to take more write downs associated with bad mortgages and mortgage-backed securities:
Christopher Whalen: What it comes down to is surprises. Everybody believes that somewhere on Citi's balance sheet, there is more subprime paper or collaterialized debt obligations that have not been valued properly.
Whalen says Citi's CEO, Vikram Pandit, doesn't have enough experience as a banker, and should step down. But the company's largest individual investor expressed confidence in Pandit this week, and increased his stake in the bank. For its part, Citigroup says it has enough capital to stay independent.
I'm Janet Babin for Marketplace.
Jagow: One share of Citigroup is worth $5 this morning.