Citigroup signals $10bn quarter loss
A $10bn loss would cause Citigroup's full-year operating loss to be well in excess of $20bn
Tuesday January 13 2009
Citigroup shares fell more than 10pc yesterday to their lowest level in nearly seven weeks after news that the bank might report a quarterly operating loss of at least $10bn as it considers combining its brokerage with that of Morgan Stanley.
A $10bn loss would cause Citigroup's full-year operating loss to be well in excess of $20bn. The third-largest US bank by assets is expected to report its quarterly results on January 22. It excludes an estimated $4bn gain from the recent sale of the bank's German retail banking business.
Merger
The transaction combining Citigroup's Smith Barney brokerage with Morgan Stanley's brokerage would result in a joint venture run by Morgan Stanley. That bank will likely pay $2.5bn in cash in exchange for a 51pc stake in the venture, a person familiar with the matter said yesterday.
A pact is expected in the middle of the week.
In late trading yesterday, Citigroup shares were down 70 cents, or 10.4pc, to $6.05 on the New York Stock Exchange.
They traded as low as $5.75 on November 25, according to Reuters data.
