Citigroup Posts Loss, Splits Up the Company

17 01 2009

Citigroup posts $8.29B loss, separates traditional banking business from riskier ventures

Citigroup says it is splitting up into two businesses as it sustains its fifth straight quarterly loss.

One business, Citicorp, will do traditional banking, and the other, Citi Holdings, will hold the company’s riskier assets.

The bank’s move reveals its growing focus on back-to-basics lending and deposit-gathering, and dismantles the “financial supermarket” created a decade ago.

The New York-based bank posted a fourth-quarter net loss of $8.29 billion, or $1.72 per share. Analysts expected a loss of $1.31 per share.

The government has lent Citigroup $45 billion, and agreed to backstop losses on some $300 billion in mortgages and other assets.

Source: Associated Press

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