The Jury's Still Out On Citi

Vikram Pandit

Here's the latest on Citigroup.

Bloomberg reports that Citigroup has said its funds at risk rose to $28.6bn in five European countries including Spain, where the government is seeking to regain investor confidence amid the region’s debt crisis.

The figure represents the gross amount of funded and promised loans in the so-called GIIPS countries of Greece, Ireland, Italy, Portugal and Spain at the end of March, according to a presentation posted on the bank’s website. The amount is 3.6% more than the $27.6bn the firm had disclosed for the end of 2011. Citi has cut its net funded exposure, which accounts for collateral, margin and protection the company has obtained, by 7.7% to $6bn.

The news organisation also reports that the firm, which has been paying a 1-cent quarterly dividend since last year, may wait until it submits a 2013 capital plan to the Federal Reserve before seeking approval to boost the payout or buy back shares.

Finally, Bloomberg reports that Citi CEO Vikram Pandit has said that the firm isn’t under immediate pressure to sell its entire stake in Morgan Stanley Smith Barney because the company has made progress in reaching its capital goals.

The Wall Street Journal reports that although Citi's stock rallied on its Q1 earnings, analysts weren't actually falling over themselves to give the firm plaudits.

The newspaper quotes Jeffery Harte, an analyst with Sandler O'Neill & Partners, who said: 'The earnings bar has been set pretty low for the industry as a whole and for Citigroup in particular. It doesn't take that much to get people feeling good about the stock'.

CLSA Credit Agricole Securities analyst Mike Mayo said: 'This quarter could have been worse and it wasn't. (But) after a decade of underperformance, we'll have to see several more quarters to judge whether this is any sort of inflection point'.


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