by Bill McBride on 5/01/2009 07:54:00 PM
Friday, May 01, 2009
From the WSJ: Citi Said to Need Up to $10 Billion
Citigroup Inc. may need to raise as much as $10 billion in new capital, according to people familiar with the matter ...If Citi isn't required to raise capital, I doubt there will be much confidence in the stress test results. I was expecting a much higher number than $10 billion.
The bank ... is negotiating with the Federal Reserve and may need less if regulators accept the bank's arguments about its financial health ... In a best-case scenario, Citigroup could wind up having a roughly $500 million cushion above what the government is requiring.
Also, from the NY Times: Citigroup to Sell Japanese Units for $5.56 Billion
Citigroup said Friday that it would sell its Japanese brokerage and investment banking units for $5.56 billion, securing much-needed capital before results due this coming week from a U.S. government “stress test” of its financial health.
Citigroup said it would realize a loss of $200 million on the transaction, which would generate $2.5 billion in tangible common equity, a measure of financial health.
Posted by Bill McBride on 5/01/2009 07:54:00 PM