“Citigroup Inc revealed plans to cut 52,000 jobs by early next year in a dramatic move to restore the No. 2 U.S. bank to health as it combats mounting debt losses and sagging economies worldwide. The reductions announced on Monday by Chief Executive Vikram Pandit will affect 15 percent of Citigroup’s work force, and are in addition to 23,000 jobs eliminated between January and September.” [Link]
Banking Pictures + News
“Threatening letters sent this week to banks and financial institutions declare ‘it’s payback time’ and promise death to its readers, according to the text of the message released Thursday. More than 50 letters mailed to Chase Bank branches and federal regulatory offices in 11 cities this week, most filled with white powder, have so far tested negative for any dangerous toxins. ” [Link]
“The Treasury Department’s decision to take equity stakes in banks represents a significant reversal, coming just weeks after Treasury Secretary Henry M. Paulson Jr. had opposed the idea. In a momentous meeting yesterday afternoon in Washington, Paulson, flanked by top financial regulators, told the executives of nine leading banks that they needed to participate in the program for the good of the national economy, two industry sources said on condition of anonymity because they were not authorized to speak publicly. ” [Link]
Karima Adebibe in Union Jack
“The British government will on Monday announce plans to take controlling shares in HBOS and Royal Bank of Scotland (RBS), two of the banks worst affected by the global financial crisis, media reports said. Government representatives could be installed on their boards in a move so unprecedented that trading in banks on the London stock market could be suspended to allow traders to digest the news, newspapers reported.” [Link]
“The closing represents the demise of what once was the largest U.S. thrift but came to symbolize many of the worst excesses of the mortgage boom. Federal regulators said WaMu has suffered an exodus of $16.7 billion in deposits since Sept. 15, leaving the Seattle thrift ‘with insufficient liquidity to meet its obligations.’” [Link]
“Morgan Stanley sought shelter from the growing financial storm Wednesday, entering preliminary merger talks with Wachovia Corp. and other banks as a seventh straight decline in the company’s share price sent the stock to its lowest level since 1998. After a harrowing day, Morgan Stanley’s shares finished down $6.95, or 24%, to $21.75. Goldman Sachs Group, the largest U.S. investment bank by market value, also fell $18.51, or 14%, to $114.50.” [Link]
“The New York Times, citing unidentified people familiar with the matter, said an auction of the bank was already under way, and The Wall Street Journal reported Wells Fargo & Co. and Citigroup Inc. expressed interest in a takeover.” [Link]
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