Government Now Holds 36% Share in Citigroup

By: Associated Press
By: Associated Press
To join the conversation on this story and others, "like" our KKTV 11 News Facebook page!

A deal has been made for a third rescue attempt in the past five months for struggling Citigroup.

The U.S. government will exchange up to $25 billion in emergency bailout money for as much as a 36 percent equity stake.

The deal is contingent on private investors also agreeing to a similar swap.

The conversion will help provide Citi the mix of capital needed to withstand further weakening in the economy. The stock-conversion option gives the government greater flexibility in dealing with ailing banks. It also gives the government voting shares, and therefore more say in a bank's operations.

Investors appeared disappointed in the deal and expected dilution of their stake, sending shares plummeting 94 cents to $1.56 in premarket trading.

Citi will also reshape its board of directors.

KKTV firmly believes in freedom of speech for all and we are happy to provide this forum for the community to share opinions and facts. We ask that commenters keep it clean, keep it truthful, stay on topic and be responsible. Comments left here do not necessarily represent the viewpoint of KKTV 11 News.

If you believe that any of the comments on our site are inappropriate or offensive, please tell us by clicking “Report Abuse” and answering the questions that follow. We will review any reported comments promptly.

powered by Disqus
KKTV 520 E. Colorado Colorado Springs, CO 80903 Office: (719) 634-2844 Fax: (719) 632-0808 News Fax: (719) 634-3741
Copyright © 2002-2016 - Designed by Gray Digital Media - Powered by Clickability 40419362 -
Gray Television, Inc.