In Sheila we trust.
Maybe that should be the new mantra for U.S. taxpayers — especially ones who don’t feel the nation’s bankers have shown sufficient gratitude for being bailed out and saved from their own incompetence and greed.
Is Citigroup trying to preserve cash by stiffing some of its vendors?
The other day a vendor for Citibank, the national banking arm of the defacto US taxpayer-owned bank, told me how Citi might be playing games with some of the companies that do busines with it. This vendor says he always used to get his bills paid within 30 days of submitting them to Citibank. But recently it too more than 60 days for a bill to get paid.
”We have and will continue to exit several forms of proprietary risk-taking. Where we continue to take principal risk, we will only do so when we have proven teams and a clear source of advantage.” – Citigroup CEO Vikram Pandit on January 16, 2009.
Don’t be fooled by Vikram Pandit’s playing the part of a prudent banker.
Here’s a summer quiz: Identify the following two US banks:
1. This institution has been profitable throughout the credit crisis. Last year, it reported net income of $6bn on revenues of $60bn, despite taking big hits in its consumer operations in North and South America in the fourth quarter. At the end of the first quarter the bank had total assets of $958 billion, supported by a healthy deposit base of $660 billion.
Goldman Sachs is moving up the derivatives charts—with a bullet.
In the latest ranking of US banks with large derivatives exposure, Goldman moves up from fourth place to second, according a report from the Office of the Comptroller of the Currencey. The notional value of Goldman’s derivatives contracts at the end of the first quarter was $39.9 trillion, up from $30.2 trillion in the fourth quarter of 2008.
It’s still not clear if the Obama administration has a plan for dealing with the derivatives monster, which is one of the biggest problems regulators must confront in dealing with the potential collpase of a “too big to fail” financial institution.