Citigroup May Lose Middle East Funding
Today, Merrill Lynch cut Sillybank AKA Citigroups earnings estimates,
citing the possibility of $15 billion in subprime CDO-related write downs in Q1. But thats not all, it gets better...
The intervention of sovereign funds such as ADIA, which pumped $7.6 billion into Citi, has failed to stem a decline in the bank's share price.
Citi's share price has fallen by almost 35% since late November, when the ADIA stake purchase was first reported.
The bank said in January that it lost $9.83 billion in Q4 spurred by $18 billion in write downs.
To stem the losses Citi said it planned to raise $14.5 billion in capital by selling stakes to investors
including Saudi's Prince Alwaleed, the lenders largest single shareholder.
Not so fast Joe... Mideast sovereign wealth funds may fail to save the troubled U.S. banking giant
unless more cash is pumped into the lender, the head of a $13 billion Dubai-owned investment firm said Tuesday.
Sameer Al Ansari, Chief Executive of Dubai International Capital told delegates at a private equity conference that it will take more than the combined efforts of
the Abu Dhabi Investment Authority , the Kuwait Investment Authority and Saudi investor Prince Alwaleed bin Talal to save the bank.
"It's going to take more than that to rescue Citi," Ansari said.
He added that more write downs are expected and that Gulf investors would be required to bolster Citi.
Even a fat & happy sheik eventually wakes up...
Mukarram Al Atasi, head of investments at Commercial Bank of Dubai, the fourth-largest lender in the Persian Gulf emirate:
"It's hard to tell whether sovereign wealth funds should or should not invest in foreign banks if they see another round of write-downs."
citing the possibility of $15 billion in subprime CDO-related write downs in Q1. But thats not all, it gets better...
The intervention of sovereign funds such as ADIA, which pumped $7.6 billion into Citi, has failed to stem a decline in the bank's share price.
Citi's share price has fallen by almost 35% since late November, when the ADIA stake purchase was first reported.
The bank said in January that it lost $9.83 billion in Q4 spurred by $18 billion in write downs.
To stem the losses Citi said it planned to raise $14.5 billion in capital by selling stakes to investors
including Saudi's Prince Alwaleed, the lenders largest single shareholder.
Not so fast Joe... Mideast sovereign wealth funds may fail to save the troubled U.S. banking giant
unless more cash is pumped into the lender, the head of a $13 billion Dubai-owned investment firm said Tuesday.
Sameer Al Ansari, Chief Executive of Dubai International Capital told delegates at a private equity conference that it will take more than the combined efforts of
the Abu Dhabi Investment Authority , the Kuwait Investment Authority and Saudi investor Prince Alwaleed bin Talal to save the bank.
"It's going to take more than that to rescue Citi," Ansari said.
He added that more write downs are expected and that Gulf investors would be required to bolster Citi.
Even a fat & happy sheik eventually wakes up...
Mukarram Al Atasi, head of investments at Commercial Bank of Dubai, the fourth-largest lender in the Persian Gulf emirate:
"It's hard to tell whether sovereign wealth funds should or should not invest in foreign banks if they see another round of write-downs."
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