Where’s Citigroup with gov’t repay?
TEXT OF STORY
Bill Radke: the markets also got some juice this week when Bank of America said it was about to pay back
the taxpayers bailout money. Yesterday, B of A says it raised more than $19 billion toward that goal. So what about the other bank that got the really huge government rescue. Citigroup, we’re looking at you. Here’s Marketplace’s Amy Scott.
Amy Scott: So what is it going to take for Citigroup to pay back the government?
Jaime Peters: A lot more time. Citigroup is not anywhere close to being able to repay TARP.
That’s analyst Jaime Peters with Morningstar. For one thing, Peters says Citi has to get further along in its plan to unload some of its struggling businesses.
Peters: Those businesses are losing a lot of money and until we kind of see them gain a lot more traction in getting rid of them, we probably won’t see them repay the government funds that are still in the bank.
Bank of America’s exit from TARP will leave Citigroup the last big bank subject to the restrictions of pay czar Kenneth Feinberg. But Peters says it has one advantage over Bank of America. Earlier this year Citi converted more than half the government’s stake to common stock, which she says the government can sell without Citi having to pay the money back. But it still owes the U.S. taxpayer some $20 billion.
In New York, I’m Amy Scott for Marketplace.
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