Quick Hits: Citi's Leverage Grows Despite Dumping Assets Minyanville Staff Apr 18, 2008 10:05 am |
![]() |
![]() |
|
||||||||||||
|
Despite a flurry of recent actions to clean up its balance sheet, Citigroup's (C) leverage continues to rise.Citi's new CEO, Vikram Pandit, has spun off units, cut the dividend and handed out pink slips to preserve shareholders' precious equity. The moves, however, have not offset the erosion of its capital base caused by declining asset values.
The company announced yesterday, ahead of this morning's earnings release that it's selling CitiCapital, a commercial lending operation with 160,000 customers in North America and $13.4 billion in assets, to General Electric (GE). The two companies didn't disclose the price of the acquisition, but GE expects the new division to be a "significant growth opportunity."
Despite efforts to shed assets and reduce exposure to risky mortgage-backed securities, Citi's leverage grew in the fourth quarter of last year to 19:1, up from 18:1 the quarter before. It looks like bean counters in the bowels of the company's accounting department are still trying to lever the struggling bank out of its problems.
For more on the banking industry, check out Hoofy and Boo's always astute analysis:
discuss this article and more on the mv exchange |
|
Get real-time options trading ideas from Steve Smith, veteran options trader and newsletter author, plus let him show you the way to cut risk and boost your returns through the strategic use of options. Click here for a free 14 day trial to OptionSmith by Steve Smith.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2009 Minyanville Media, Inc. All Rights Reserved.
| add rss feed | free article alerts |
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
DC
Delaware
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennesee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
Local Guides

















