If you find a stray $US7.6 billion ($A8.2 billion) lying around today, return it to Citigroup in New York; it lost it in the three months to December and it will come in handy refilling a few ATMs here and there.
Citigroup still needs it; the most troubled of America’s big banks, produced 4th quarter “earnings” overnight and the big loss was mostly driven by the odd desire to repay $US20 billion of capital from the US government during the quarter).
That was a move to escape the pay restrictions of the US government governing banks and other groups it helped save during the crunch a year or so ago.
So to give itself a bit more flexibility in paying staff bonuses, Citi stuffed shareholders by incurring a big loss by repaying the so-called Tarp money.
But even if Citi had not repaid the money, it still would have lost $US1.4 billion, an outcome that ended three quarters of profits, and confirmation that it essentially remains a basket case.
But thanks to the rebound in markets and the US and other economies, things are definitely better than a year ago: Citi lost a much larger amount in the December quarter of 2008; an eye-catching $US17.3 billion.
Overall the lumbering giant lost $US1.6 billion in 2009: peanuts really compared to the still-shocking $US27.7 billion lost in 2008. If you manage to find any of that, let Citi know, it will probably make you chairman or CEO.
Citi has restructured in the past year, shedding businesses at home in countries such as Germany and Japan, so that helped to explain a 4% drop in revenues to $US5.41 billion.
Losses on credit securities again were huge: $US7.1 billion, but that was down $US800 million from the September quarter and the second quarterly improvement.
Citigroup also said it spent $US25 billion to compensate its employees in 2009, which broke down to roughly $US90,000 per employee. A year ago, the bank paid $US31.1 billion to its employees, but Citi had more employees that year. It sold several divisions in 2009.
Citi’s result follows JPMorgan Chase’s better-than-expected profit last Friday of $US3.3 billion for the December quarter. Bank of America, Wells Fargo, Morgan Stanley and Goldman Sachs are all due to release their results later this week.
Some media outlets reported overnight that Goldman Sachs was delaying a decision on the size of and composition of its controversial bonuses to staff.
There seems to be a reason: The Daily Telegraph in London reported that the Financial Services Authority, Britain’s financial regulator, had taken issue with Goldman’s bonus plans, effectively blocking them.
Goldman CEO Lloyd Blankfein said in an interview late last year that he was doing “God’s work”. It must grate on this mighty man that a lot of piddlingly small people are making life tough for God’s -anker and his disciples.