BamBam

Eight Reasons Bank of America Is Going to $20

I suppose there's an outside chance that these big banks could get through the next few years without fatally diluting existing shareholders. This optimistic scenario would rely on very generous terms as part of the gov't bailout...perhaps convertible securities specifically designed to allow company managements time to sell assets and minimize dilution. It would require a large and aggressive "bad bank" paying top dollar for illiquid assets.

It's not enough to say that nationalization is off the table. If you're looking at the common stock, you've got to make a case or present a scenario in which existing shareholders are not terribly diluted.

Unfortunately, despite the author's optimism, he make no such case. There is absolutely no rigor to this argument.

Citi's Management Looks Overmatched

I wanted to see a breakup of Citigroup during the bull market for financials. That would have added tremendous shareholder value and mitigated the scope of the current problems.

But, now is NOT the time for Pandit to sell off core assets at firesale prices. I want Citi to ride this out, preferably with an endorsement from the Gov't, while keeping all options open when times get better.

I suspect that some of the stories about Citi selling itself or dumping core assets are planted by competitors like Goldman Sachs, which is desperately trying to get its grubby hands on Citi's deposits.

Sachs and the Citi

It's Goldman that is desperate for the assets of Citigroup, not the other way around. Unfortunately, Goldman and its crooked friends at Treasury and the SEC are trying to drive Citigroup into the arms of Goldman at a discount price.

Vikram Pandit Rejects CitiSachs?

Pandit needs to buy a deposit base at firesale prices, not a bunch of overpaid I-Bankers in search of a deposit base.

Citi's Pandit: Still Going in Circles

Pandit is nothing more than a Yes-Man representing the conflicted, empire-building interests of Sandy Weill and Bob Rubin. The first step in seeing shareholder value here is to sweep the board of directors clean of the influence of these two corrupt old men.

Citigroup's Management: Many Questions, Few Answers

Pandit needs to get out there now and communicate a plan. He doesn't have two more months to mess around while the stock gets crushed on rumors.

If he's decided to keep this conglomerate together, he needs to explain in detail to his shareholders why that plan maximizes shareholder value...particularly in light of a decade of terrible returns to shareholders and Citi's persistent inability to demonstrate the viability of the Financial Supermarket model. After a decade of operations, the only areas in which Citigroup has achieved scale are scandals and risk mismangement.

Furthermore, Pandit should already have gotten rid of the senior managers whose incompetence and cowardly behavior ran Citi into the ditch. I'd start with Sallie Krawcheck.

Finally, every member of the board needs to state that he/she will not stand for re-election. This derelict board totally failed shareholders. In particular, Rubin should resign in disgrace for his total lack of attention to the job at hand.

Citigroup Break-Up Analysis

I think Pandit is just a stooge for Sandy Weill and Bob Rubin. A condition of his hiring (and of Sandy's capital injection) was that he not consider breaking up Sandy's failed legacy.

If Citi is to breakup, shareholders need to demand further changes at the top, including Rubin and this entire derelict board of directors.

It's time that the majority owners of Citi, who own 95% of the shares, take control of the company from the 5% who have been calling the shots through their agents on the board.

Vikram Pandit Achieves Rockstar Status

My concern is that the Rubin/Bischoff combination will be a force in support of the status quo.
I don't question Pandit's intelligence. But I do wonder whether he's able and willing to fight for drastic change. Does he have the guts to publicly admit that the Financial Supermarket model has failed?

Still Underwhelmed by Pandit

Citigroup should be broken up ASAP. Some divisions could be sold to JPM, for example. Some would do well on a stand alone basis.
But, with Rubin and Bischoff hanging around, I think the fix is in. I'm not sure Pandit will be allowed to consider a breakup, even if it's by far the best option for shareholders.

Tom Brown’s School Days

You have deliberately taken the man out of context.

His point, I believe, was that Citi's leadership and balance sheet problems would likely preclude it from making any large acquisitions, even if the regulators did permit it.

The subsequent financing arrangement to patch up those balance sheet problems in no way contradicts that assertion.

Too Late for a Citigroup Breakup?

As a shareholder, I agree that Prince's efforts to combine back office functions is probably destroying value. In retrospect, the time and expense pursuing the "One Citi" vision will be totally written off when the new CEO takes over and breaks this thing up.

However, I don't think a breakup strategy is necessarily reliant upon acquirers buying the spinoffs. Under most breakup schemes proposed, each of the single-line businesses would be big enough to stand alone indefinitely. In fact, that might be preferable.

Why Citigroup Should Be Broken Up - Now

Are you listening, Bob Rubin?

There's just no excuse to drag this out any longer.

CreditSights Analyst Joins The 'Breakup Citi' Team

Mr. Hendler's proposal seems very familiar to me for some reason.

Citigroup Execs Fear Activist Hedge Fund Targeting

Even though no well known activists own the stock, the stock's performance on rumors of Prince's ouster seems to suggest that big money agrees with the idea that Prince should go and Citigroup be broken up.

Furthermore, I believe this FT story confirms that Citigroup insiders think so too.

Pressure on Citi to Raise Bid for Nikko Rises to New Heights

Don't negotiate against yourself, Chuck Prince!