Citi Posts $8.3B Loss, Prepares to Split in Two

Still smarting from bad mortgage bets, the company will split to remain solvent
By Clay Dillow,  Newser Staff
Posted Jan 16, 2009 7:52 AM CST
Citi Posts $8.3B Loss, Prepares to Split in Two
A Citi Smith Barney logo is shown at the bank's office Thursday, Jan. 15, 2009 in New York. Citigroup's CEO Vikram Pandit said Wednesday that the company is going through a "long-term transformation."   (AP Photo/Mark Lennihan)

Citigroup lost $8.29 billion in the fourth quarter—twice as much as expected—as the credit crisis continues to batter big banks, Bloomberg reports. The bank suffered a net loss of $1.72 per share, falling far short of analysts’ estimates. Citigroup, which lost 77 percent of its trading value last year as it accepted $45 billion in bailout funds, now looks to split into two entities.

Citigroup will move units it wishes to keep, such as branch banking, corporate lending, and private banking, into a business called Citicorp, while “non-core” units such as CitiFinancial, brokerage, and retail asset management will collect under the umbrella of Citi Holdings. Citi will continue to shed non-essential units and cut deals to free up cash, such as the pending $21 billion Smith Barney joint venture with Morgan Stanley.
(More Citigroup stories.)

Get breaking news in your inbox.
What you need to know, as soon as we know it.
Sign up
Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X