Focus on Citigroup:Inside the Rescue Package

Citigroup is a firm that is so large and complex,it's difficult to ascertain just how large it is.There are various rankings of it,depending on what factors are considered.Some say it is the largest bank;some say it is second-largest;it has even been described as fifth largest.In any event,it has around two trillion dollars in assets.It's off-balance sheet entities amount to about 1.23 billion dollars.Those are the troubled ones.Citi's Smith Barney brokerage alone has over 15,000 advisors.When Citi's announced job cuts are completed,it will have about 300,000 employees in 106 countries.The U.S. government has fully committed itself to Citi's survival,believing its loss would be devastating to the world economy.The U.S. is injecting a further 20 billion in cash into Citi;is acquiring 27 billion of Citi preferred stock with an interest rate of 8%;and is guaranteeing 306 billion of Citi securities,loans and commitments.No management changes are required of Citi;executive compensation must be submitted to the government for approval;the quarterly dividend must be reduced to one cent a share for the next three years;and job cuts will be global,across Citi's multiple businesses.The government will acquire a 7.8% stake in Citigroup.