The panel had calculated the total amount of federal aid each bank had received during the bailout from TARP ($25 billion), the Federal Reserve ($88 billion), and the FDIC ($68.6 billion). Citigroup topped the list with Bank of America (NYSE: BAC) in a close second at $336.1 billion received. Morgan Stanley (NYSE: MS) came in third place with $135 billion in federal aid.

The Oversight panel was put together by Congress as a way to supervise TARP funds. The panel is expected to cease its operations within the week. It still has to put out its final report on the bailout of the financial sector. In general, the panel was positive about the government’s attempts to stabilize the global financial system and avoid a second Great Depression. While TARP did provide much of the necessary support in the efforts, it is not the only resource deserving credit.

One large criticism of the TARP program from the panel involved the issuance of billions of dollars to financial institutions without the requirement of banks reporting how the money was used. The result is that no one will ever be sure of how that money was spent. This occurred in the early days of the TARP assistance movement.

Additional criticism allege that the TARP program created a dangerous scenario where banks were not worried about loss as they expected taxpayers will bear the burden of any losses incurred. There was also concern expressed over the Treasury’s intervening assistance to the automotive industry since they were not directly working in the financial system. It was felt the risk in doling out funds to the auto industry had too much failure potential.

Citigroup (NYSE: C) High Up on List of Federal Aid Recipients was created by and is property of American Consumer News.

During 1997 through 2006, mortgage lenders created a variety of no money down type programs and “loan to own” mortgages which eliminated the strict requirements previously needed to get a mortgage. Individuals did not have to prove their ability to repay the mortgage or have sizeable downpayments during this period, and lenders like Bank of America, Wells Fargo and Citigroup lent millions of mortgages to people they knew had little chance of fully repaying them.

The original mortgage lending practices are returning, where borrowers are required to come up with a 20% minimum down payment to qualify. To contract the difference, in 2006 the average home down payment was 4% of the purchase price, while in 2010, across nine major United States cities the median down payment was 22%.

Lower down payments make it possible for more homeowners to get into homes, but it leaves them with costly mortgages they can’t afford and results in high numbers of foreclosures. Even individuals who have managed to avoid foreclosures through mortgage refinancing programs offered recently are experiencing long term financial distress – since they owe so much more than their homes are worth in today’s market.

If borrowers can’t come up with 20% or more for a down payment, they can look at loans backed by the Federal Housing Administration (FHA). Currently, these loans require 3.5% at closing, but come with private mortgage insurance expenses and higher than average interest payments. While it offers the opportunity to get into a home, the monthly payments will be higher.

Resource:

http://www.housingpredictor.com/2011/banks-want-more-money.html

Bank of America (NYSE: BAC), Wells Fargo (NYSE: WFC), Citigroup (NYSE: C) Penalties Likely to End “No Money Down” Programs was created by and is property of American Consumer News.

The bank’s market value rose to $157.6 billion in December 2010 compared with JP Morgan’s stated value of $156.4 billion. When assets are taken into account Wells Fargo is ranked fourth behind, Bank of America Corp, JP Morgan and Citigroup Inc.

The acquisitions strategy used by Wells Fargo under the guidance of Chief Executive Officer, John Stumpf has been very successful. Under his guidance, the bank made over 55 asset purchases in the past five years. Bloomberg Data indicates they spent $12.7 billion on the takeover of Wachovia in October 2008. This raised the value of assets from 622.4 billion to $1.2 trillion in September 2010.

The value of Wells Fargo shares in December 2010 is around $30.02. A recent gain of 0.8% followed an 11% advance during the previous months of 2010. The largest shareholder in Wells Fargo is Warren Buffet’s Hathaway Group.

The Bank of America stock, during 2010, has not been as successful on the stock exchange. Currently valued at $126.3 billion it is significantly less valuable as a stock than Wells Fargo. The current Bank of America share is valued at $12.52. Citigroup is also more valuable despite its bail out by the US government. Citigroup is valued at $133.2 billion.

Although it is smaller than The Bank of America and Citigroup, Wells Fargo is a more popular stock possibly due to its acquisition program. Analysts feel Wells Fargo will boost its dividend to shareholders during 2011. They also see Wells Fargo shares will increase in value.

Recent payouts from Wells Fargo were paid on December 15, 2010. Series J shareholders received a quarterly cash dividend of $20. A quarterly cash dividend of $18.75 was paid to Series L shareholders.

Wells Fargo continues to rank No 1 in customer satisfaction surveys. This will support the share values. Carrie Tolstedt, head of Community Banking, said, “Providing a consistent and exceptional customer experience is one of the best ways we can achieve our company’s vision of satisfying all our customers’ financial needs and helping them succeed financially. As always, we will continue to look for ways to improve our service.”

Wells Fargo (NYSE: WFC) is the Most Valuable US Bank was created by and is property of American Consumer News.

He told CNBC that the company still needed more reforms and more work was needed to restructure Citi Holdings. Citigroup is still selling assets and restructuring their global operations. The US Federal government is still settling its $45 billion loan with Citigroup. Citigroup still has to restore its reputation gained as a result of the financial crisis.

Vikram Pandit appears to be leading Citigroup’s metamorphosis successfully. He has changed since being criticized of being out of touch with the way Citigroup needed to be restructured. He was supported by the federal Government not wishing the demise of Citigroup.

“While we think the markets are increasingly recognizing who we are, we’ve got some ways to go,” Pandit has said. He wants Citigroup to be seen and appreciated as a successful business and believes in an economic recovery. Citigroup is still influenced by the direction the global economy takes as well as the level of unemployment and the housing situation in the US.

“The housing market usually takes a little bit longer and that is not only today’s phenomena, that’s been true whenever there have been housing cycle. The key, key indicator for us is to watch how businesses do, how they grow, how they invest, and that is going to create jobs,” he said.

Citigroup shares have taken a battering over the past ten years. So much so that today they are worth a tenth as much as they were worth at their peak. However Citigroup shares have gained in value over the past year (2010). The stock has gained around 31% in value and reflects Citi’s improved position particularly amongst its competitors.

On a hopeful note Vikram Pandit said, “We’ve had to go through some trying times to get there,” “Now that we’re here I feel very good about how we’re positioned.”

Citigroup still has a lot of asset reduction to bring about. As a result the earnings in 2011 and 2012 are likely to be less than predicted. Only time will tell whether the new Citigroup restructure is successful.

No Rewards for Citigroup (NYSE: C) Investors was created by and is property of American Consumer News.

The purchase of 85.6% share ($3.06 billion) in Guangdong Development Bank in 2006 was one of the ways Citigroup grew its Asian ventures. Asian economies, according to Citicorp Chief Executive Vikram Pandit, have recovered quicker than most from the financial crisis.

The co-head of Citigroup’s China investment banking team, Eugene Qian, at a recent news briefing in Beijing said, “Citigroup’s strong capital base and the ability to maintain capital costs at low levels will help us achieve that goal,” Qian also said, “We are confident that China’s economy will remain stable next year and the global capital market (environment) will be better.”

Morgan Stanley and Goldman Sachs are also providing financial underwriting and advising to Chinese companies and Citigroup intends to rival their success. According to Eugene Qian the investment opportunities available in China are big enough so out right competition between investment banks will not be necessary.

A recent agreement signed by Citigroup was with Zhongyuan Securities. The aim is to set up a joint venture that will enable the partnership to set up a securities joint venture via the A-share market. Citigroup did not comment on this venture but said they were still looking to establish more partnerships with local Chinese securities companies.

As well as expanding their investment banking business in China Citigroup is also keen to develop its commercial banking arm. It has 31 commercial branches in China at present and plans to treble this to over 100 in the next few years. This expansion will also involve employing more Chinese nationals. It is predicted that around 12 000 new Chinese employees could be employed in the near future.

The US market is still a problem for Citigroup and as a result Asia is seen as an important revenue source. The Asia-Pacific region contributed $3.5 billion of Citigroup’s $9.3 billion profit in the nine months of 2010. Stepen Bird, Citigroup’s co-chief executive officer for the Asia-Pacific region said, “We are very excited about China. For us, this is still the beginning of the China story.”

Citigroup (NYSE: C) Plans China Expansion was created by and is property of American Consumer News.

Citigroup has a lot to do to regain its position in the market place. A banker from another group commented about his view of Citigroup. He said, “It wasn’t so long ago that we were all afraid of Citigroup. They were going to be the model of the future.”

Citigroup lost many of its senior investment bankers in Europe and has not hired any replacements. Its reputation and standing in Europe has taken a huge battering. However, there are now two new managers of Citigroup’s Europe investment banking business.

James Bardrick and Manuel Falco have equal standing and plan to announce Citi’s new European strategy. It is expected they will announce the type of clients and market group they will focus upon.

Many in the banking area, including those in foreign currency trading, believe it is unwise to underestimate Citigroup and point to the revenue that has been earned in recent quarters. Revenue for the first half of 2010 was estimated at $4.28 billion. As impressive as this is, Citigroup still has challenges ahead.

In 2011 Citigroup is aiming to open a network of bank branches in a few European cities. Their target market will be their affluent citizens. The cities are in France, Britain and Germany and Poland, according to the Financial Times.

The Financial Times quoted an unnamed person, familiar with Citicorp’s new marketing strategies, who said, “Further down the road, we will open up in key cities in Western Europe. 2011 is a potential turning point.”

There was no comment from anyone at Citigroup about this even though it resonated with Citigroup’s new marketing plan of focusing on around 100 of the world’s cities. This includes 10 to 15 Western European cities.

“We have made a number of strategic changes to our coverage model to increase the focus on our core clients, which has created a number of exciting new opportunities for our bankers and also may have resulted in some people choosing to pursue their careers elsewhere. Several of the departures were mutual, and in some cases, welcome. We have also made a number of important new senior hires, and plan to announce more over the next few weeks,” said a Citigroup spokesperson.

Citigroup (NYSE: C) Plans to Target Europe’s Wealthy Citizens was created by and is property of American Consumer News.

The case centers on Wells Fargo’s backroom deal to wrest the failing bank from Citigroup after an initial deal had been put on the table to buy Wachovia. The bank had been ready to fail due to toxic real estate loans when it entered the U.S. government-backed deal with Citigroup. As a consequence, Citigroup turned around and sued Wells Fargo, an act which led to the current settlement.

According to the details of the lawsuit filed by Citigroup in New York Supreme Court, the company accused the executives at Wells Fargo and Wachovia respectively of a breach of contract. They were pursuing reparations totally $60 billion for damages, not relating to online currency trading.

All of this activity also served to highlight Citigroup’s instabilities in the wake of financial crisis. In fact, the company was in a vulnerable position at that time. Several weeks following the establishment of the original deal with Wachovia, Citigroup found itself in deep trouble. A number of bad investments accumulated and dealt a serious blow to the company.

During a time when so many businesses and major corporations were taking government bailout money, Citigroup was among the takers. In total, the company received $45 billion from the United States government. In the last couple of years, the government has gradually been cutting back the percentage of its stake in the big bank. At present, it still retains a 12 percent ownership in Citigroup.

Concerning the matte of the $100 million settlement, it should be noted that this amount represents only a tiny fraction of the total earnings and assets that is owned by the San Francisco-based Wells Fargo. Known as one of the largest banks in the United States, Wells Fargo earned a staggering $3.15 billion in the third quarter of 2010. As of September 30, the company showed $16 billion in cash on its balance sheet.

Despite the controversy surrounding the settlement the company is still making a strong market showing. As of Friday, November 26, 2010, Wells Fargo’s shares had increased by 2 cents for a $27.53 per share total in afternoon trading.

Wells Fargo (NYSE: WFC) Will Pay Citigroup $100M In Lawsuit Concerning Wachovia was created by and is property of American Consumer News.

Poor real estate loans had caused Wachovia to agree to Citicorp purchasing it. The purchase was supported by the U.S. Government. The Citigroup purchase was undermined by Wells Fargo, who offered Wachovia a larger settlement. Wachovia settled on the Wells Fargo deal.

The merger between Wells Fargo and Wachovia meant the size of Wells Fargo has doubled. It is now the largest retail banking network in the U.S.

Citigroup decided to sue Wells Fargo accusing them and Wachovia for breach of contract. Citigroup claimed $60 billion damages. The case was settled in New York and Citigroup received a $100 million settlement. This settlement also wiped out the multiple lawsuits Citigroup had brought against Wells Fargo and Wachovia. All banks said this settled the matter.

Anton Schutz, president of Menton Capital Advisors in Rochester, New York which had investments in both banks said, “This could have dragged on forever, and sometimes I think you’re better just settling and moving on,”

“If Citigroup had gotten Wachovia, the financial returns would have been significant. But it might have made it harder for Citi to do some of the things they’re doing now, like getting leaner.”

Losing the Wachovia deal showed Citigroup’s lack of power over the situation. Citigroup’s financial vulnerability, from poor investments, came to light in the weeks following the collapsed deal with Wachovia.

The financial vulnerability of Citigroup was such that it needed funds from the U.S. Government to save it from insolvency. The bailout amounted to $45 billion. The U.S. government in November 2010 still owns 12% of Citigroup.

The payout to Citigroup by Wells Fargo, was not a huge one, for Wells Fargo one of the largest banks in the U.S. Wells Fargo at the end of September 2010 had reported earnings in that quarter of $3.15 billion. Its shares were valued at around $27.53.

Citigroup (NYSE: C) and Wells Fargo (NYSE: WFC) Settle Dispute over Wachovia was created by and is property of American Consumer News.

The current share price will still mean a profit for the government. It is estimated at around $8 billion. This is good news for the taxpayer, as many criticized the government for rescuing Citigroup during the recent financial crisis. It is believed by some analysts, that the large government sale is factored into the current share price.

In a statement, The Treasury Department said investment bank Morgan Stanley “will have discretionary authority to sell 1.5 billion shares of Citigroup common stock under certain parameters.”

Apparently Citigroup stock is one of the most active listings on the NYSE. It is also believed, by some analysts, that the huge supply of Citicorp shares on the market will not be advantageous for investors. Institutional investors are looking at investing in Citigroup. This will support the Treasury sale and prevent harm to current shareholders. Institutions buying large blocks of Citicorp shares will give the message that the restructure is approved.

Warnings about buying Citigroup shares centre on the need for the Group to complete its turnaround plan, in order to be a viable company. Citigroup has no bidders as yet for its non-core group assets in Citigroup Holdings. Some investors are counting on the areas that have been restructured to show profit.

Citigroup continues to find ways to reduce its debt. It is hoped the sale of Primerica Inc. will earn $234 million through the sale of 18 million shares at $12 to $14 a share.

An economic recovery is the good news Citigroup needs. An improving economy would strengthen the current share value. A recovering economy would also ensure that the Citigroup share price increases in value and will also attract retail investors.

Analysts are looking with interest at the next Citigroup earnings report and believe it will be a significant one.

Citigroup received $45 billion from the Federal Government’s Troubled Asset Relief Program (TARP) in 2008.

Treasury Plans to Sell Citigroup (NYSE: C) Shares October 2010 was created by and is property of American Consumer News.

Known as, ‘The Communities at Work Fund’ it is a $200 million fund. Citicorp provides $199 million and the Calvert Foundation and the Opportunity Finance Network provides $1 million.

The fund was established with the aim of sustaining and helping business grow and so contribute to the country’s economic recovery. Traditional banks rarely give loans to this type of small business.

Community banks, the traditional lenders to small business, are not lending as freely as before.

Small business access to loans has remained low during 2010. The decline in banks lending to small business was affected by the credit crisis of 2008-2009.

Citicorp has stepped into the breach. It has already distributed funds.

A Chicago nonprofit received funds for a 60 seat restaurant. It serves low cost meals to 3500 low income families and so far employs 49 people with plans for another 12 full -time employees.

Vikram Pandit, CEO of Citi said, “Citi’s investment in the Communities at Work Fund underscores our commitment to the economic life of the communities we serve and to the U.S. economic recovery.”

“We recognize that too many small businesses, microenterprises, charter schools and community service institutions simply do not have access to credit, yet they are engines for economic growth. The Communities at Work Fund will leverage the expertise of the leaders in the Community Development finance sector and provide much-needed financing in these markets.”

Global Director of Citi Microfinance and Community Development, Bob Annibale, stressed, “Citi’s investment in the Communities at Work Fund is driven by our commitment to providing funding to small businesses and microenterprises, which are a primary source of job creation and opportunity for underserved communities.”

He states, “This is not philanthropy, but an investment in the CDFI sector, which is rooted in local communities and provides innovative financing for community development and economic growth.”

Calvert Foundation President and CEO Shari Berenbach said, “Small businesses are the engines of local economies, but the entrepreneurs behind these businesses often have the most trouble getting financing. These businesses are withering in the absence of financing.”

For over 30 years CDFI Loan Funds have been an effective way to create economic opportunities in areas that do not attract loans from banking institutions.

Low Income Areas Receive Access to Citicorp Inc (NYSE:C) Funds was created by and is property of American Consumer News.

All across the United States, banks at every level are facing revenue declines as the financial industry seems poised at the brink of the lowest growth rates since the Depression era. This slow growth period has likely been influenced by other factors such as Citigroup’s decision to enact new regulations that restrict capital rules, derivatives, as well as fees on accounts and credit cards.

Yet, there are other problems for the beleaguered financial institution. The latest information shows that Citigroup is still caught up in the throes of serious mortgage issues. In a recent New York Time report, the number of loan modification issued to the big bank had reached a new record low the previous month. This was part of multi-month trend. The Treasury Department noted that on 28,000 borrowers obtained permanent loan modifications in September 2010. This made it the lowest total number since the fall of 2009 when the program was first implemented. It is a clear indication that the loan modifications are not achieving the kind of results hoped for in most cases.

Far worse for Citigroup and many of its competitors in the financial sector is an announcement that the company Lender Procession Services and several of the major U.S. banks are officially under criminal investigation. In fact, a number of State and federal law enforcement agents are conducting a series of probes to discover whether members of Lender Processing, several foreclosure processing groups, and the bank administrators that hired them, were involved in criminal activities.

The details are yet to be worked out but a number of big banks are under investigation in order to ascertain more information about the nature of the crimes. Citigroup, as well as J.P. Morgan Chase, and Bank of America Corp are top-ranking clients of Lender Processing.

The criminal charges are causing uncertainty about the future of many organizations in the financial sector. That Citigroup in also in the mix does not bode well for the near-term improvement of the industry.

Citigroup’s (NYSE: C) Stocks Drop In Wake Of Projected Financial Declines was created by and is property of American Consumer News.

Citigroup mortgage customers are still facing foreclosures due to the inability to make monthly mortgage payments. This is largely due to the unemployment rates that have affected a family’s ability to keep steady income. Even when modifications are in place, homeowners still can’t keep up with payments regularly. This results in customers having their Make Home Affordable modifications cancelled.

Now Citigroup is offering additional options for those homeowners that can not meet the requirements as set up by Obama’s Make Home Affordable program. Additional modification programs are being created in-house to help homeowners. Throughout the month of August, more than 35,000 borrowers were given access to the alternative modification programs offered through Citigroup.

Other homeowners who are still in need of assistance with their mortgage payments are finding relief through another program called the Home Affordable Unemployment Program. This program is set to helping people who are without a job. The program helps initiate a forbearance status on mortgage payments until the time they can make other modification arrangements when they secure a steady income source.

Homeowners who have loans with Citigroup are encouraged to contact the bank as soon as they realize they will have trouble meeting mortgage payment obligations to see what options can be afforded before the mortgage loan goes into default and foreclosure status.

Citigroup (NYSE: C) Goes Outside HAMP to Offer Loan Modifications was created by and is property of American Consumer News.

Customer feedback from this selected group will be analysed before a larger rollout of cards to Citi customers occurs in 2011. Citi’s points system, which enables cardholders access to prizes or cash payout, will be maintained, but with instant access to redeeming points and cash.

Executive Vice president of Citi’s North American Credit Card Division, Terry O’Neil says, “People don’t typically think of credit cards as an innovative product, but we are excited to be the first issuer to pilot these advanced technologies and additional choice at checkout through the ‘next generation’ of credit cards.”

The new Citicard, Citi 2G Credit Card, incorporates the latest credit card technology which now gives the user a choice of 2 options at point of purchase.

These 2 options are the choice to pay from “Regular Credit” or from “Request Rewards”. The “Request Rewards” allows the customer to redeem points or cash instantly. This happens when the customer presses the “Request Rewards” button on the card.

The customer must know the level of reward points available. The card works in the same way as the old card technology. It there are not enough points available, the customer will still be charged as before.

An issue against this new technology is customers may think they are getting goods free of charge and with no waiting period. It is still the same rewards system that takes time to compile the points. They are never added to a customer’s account instantly.

The new cards are heavier than the older ones and Citibank has not specified the cost to the customer of owning one.

However, the credit card, according to phone and industry consultant Richard Crone, of Crone Consulting in San Carlos, is on the decline.

“We have reviewed more than 100 companies that are developing payment schemes that would eliminate cards altogether,” he says.

Citicorp has a belief in the success of their new card. They see their rewards program as being even more rewarding with the new Citi 2G Credit Cards. They view it as being more than a “debit or credit” card.

Citi (NYSE: C) to Launch Updated Credit Card was created by and is property of American Consumer News.

He first came into conflict with Citicorp executives in 2002 after publicly criticizing the group about their risk management policy and aggressive accounting tactics.

Mayo says, “Many of Citi’s problems relate to risk management, and there are several red flags.”

In his recent report, “A Matter of Trust”, Mayo wrote that the way Citicorp planned to meet its financial targets “can encourage short-term excesses over long-term prudence”.

Mayo believes Citicorp is not profitable, even though its accounting shows this. Citicorp, in his opinion, needs to review its accounting practices.

Citicorp’s use of the deferred tax asset accounting issue, which enables companies with losses to use future assets to reduce tax obligations, is of particular concern to Michael Mayo.

For almost two years Mayo’s request for a meeting with Senior Citigroup officers was ignored, even though it is not unusual for Wall Street executives, to meet with stock analysts at times.

In a recent interview Mayo said, “It is aggressive accounting.” Not writing down tax assets “is a window into the risk management practices at the company. It is emblematic of a bigger issue, of being overly aggressive.”

Unlike companies, in a similar position to itself, Citicorp has not written down any of its $50 billion deferred tax assets.

Mayo also disagrees with the public announcement by Citicorp that it plans to develop assets in the future. “I think it is inappropriate to list any target based on growth of assets because it is dependent on outside economic forces, which Citi can’t control,” he said.

The response of a Citicorp spokeswoman was, “Citi is very comfortable with the recording of our deferred tax assets. We have provided extensive detail on our D.T.A. in various regulatory filings.”

Even a chance meeting with Citigroup’s chief executive, Vikram S. Pandit, by Mayo in Boston in June 2010, did not get an appointment for a meeting.

In July 2010, at Citigroup’s second-quarter earnings conference call with analysts, Mayo publically raised the issue again.

As a result of this public stance, Citicorp Management on Sept.10, 2010, finally set a meeting date.

On Friday 15^th October 2010, Michael Mayo met with Citigroup’s chief executive, Vikram S Pandit and chief financial officer John C Gerspach.

A Financial Analyst’s View of Citicorp (NYSE: C) Accounting Practices was created by and is property of American Consumer News.

In the complaint, 20 current and former Citigroup directories and executives are mentioned by name, including Vikram Pandit (the current chief executive) and Charles Prince (previous chief executive).

“We believe the suit has no merit and will defend ourselves vigorously,” a Citigroup spokeswoman said in a statement.

Norges Bank is responsible for setting monetary policy in Norway, overseeing international investments of one of the largest sovereign wealth funds in the world, the Norwegian Government Pension Fund-Global. The fund has over $443 billion in assets, thanks greatly to oil and natural gas production in Norway.

Norges Bank is suing Citigroup for $735 million lost on investments in common stock and more than $100 million on Citi bonds and preferred shares, purchased between January of 2007 and January of 2009. The bank alleges that Citi made a number of misstatements about the condition of it’s financial situation, particularly involving it’s exposure in subprime mortgages and toxic assets. The misstatements lead Norges Bank to believe Citigroup was in better financial shape than was reality.

In another lawsuit filed last year, 7 Norwegian municipalities along with the bankruptcy estate of Terra Securities ASA, filed suit over the sale of $2115 million in derivatives in 2007. The claim is that the notes were misrepresented as being financially conservative and safe investments. This lawsuit is pending.

Citigroup (NYSE: C) Sued by Norway’s Central Bank for Alleged Misstatements About Financial Condition was created by and is property of American Consumer News.

Citigroup has asked a US District Judge in Manhattan to dismiss the lawsuit from Terra Firm, which alleges it was lead into believe that Cerberus Capital Management LP was also a bidder for the EMI, the music recording and publishing company. 

The judge did dismiss two of the claims made by Terra Firma but rejected the bid by Citigroup to dismiss all allegations of fraudulent misrepresentation and concealment. The judge has stated he will release a more detailed opinion on the ruling at a later time. The ruling was not yet available on the court’s website but a copy of the order was provided by Terra Firma as confirmation.

Citigroup’s argument is that there was no evidence one of its bankers knew Cerberus Capital Management wasn’t planning to bid on EMI when he told the buyout firm’s principal buyer about a plan to bid $4.07 a share for EMI.

London-based Terra Firm’s spokesperson delivered a statement that said they were looking forward to the October trial and were pleased the judge rejected Citi’s effort to avoid a trial.

The case is Terra Firma v. Citigroup, 09-cv-10459, U.S. District Court, Southern District of New York (Manhattan). Citigroup or its representatives have not made a public comment on the trial.

Citigroup (NYSE: C) to Stand Trial for Misleading Private Equity Firm was created by and is property of American Consumer News.

Citigroup froze Mayo out in late Auguest after he essentially pointed the finger at the bank for using deferred tax assets against the rules of accounting. Mayo’s complaint contends that Citigroup is using the tax assets to boost the bank’s net income, making it seem more profitable than it may actually be.

While the bank has undergone worst scandals, this one suggests a larger problem within the bank. Banking executives are aware of what is happening but it is likely the problem is an impossible one to resolve because of its status after its recent financial crisis.

Citigroup find it’s difficult to define its identity because it is now a mix of executives and other businesses acquired under Sanford Weill. The mix includes the bank, Citibank. There is also the brokerage firm, Smith Barney and the investment bank, Salomon Brothers. There are also lesser names included in the mix such as Golden State Bancorp, Associates First Capital, and Banamex.

Citigroup has worked to streamline business and has cut nonessential divisions and assets but the turnover and controversy among the executive branch has been disastrous. As the Wall Street Journal reports ‘It’s a melting pot that never melted’.

The bank has stated that the turnover at the senior management has been stabilized and 23 of the 25 managers from 2009 are still in their same positions, adding stability within Citigroup. The company is working towards reestablishing its corporate culture which it has long been absent.

Chief executive of Citigroup, Vikram Pandit, is suspected to be the force behind Mayo’s ban though the bank denies the insinuation. Pandit is not exactly comfortable in the role as a leader of one of the country’s largest banks. Rarely does he do interviews and has a propensity for overreacting to criticism from any source.

Citigroup (NYSE: C) Bans Analyst Over Accusations of Tax Assets Misuse was created by and is property of American Consumer News.

Neither Crittenden or Tildesley admitted to wrongdoing, but agreed to paid their individual fines of $100,000 and $80,000 respectively, to settle the charges against them. The U.S. Securities and Exchange Commission claim that Crittenden and Tildesley were the two bank executives most closely associated with misleading or covering up the subprime losses than the others, but U.S. District Court Judge Ellen Huvelle rejected the SEC request to settle. The judge wants additional information about why the other executives listed in the report as having knowledge aren’t being held accountable for the same crime.

Citigroup Inc. (Citigroup) is a global diversified financial services holding company. The Company provides consumers, corporations, governments and institutions with a range of financial products and services. As of December 31, 2009, Citigroup had approximately 200 million customer accounts and did business in more than 140 countries. Citigroup operates through two primary business segments: Citicorp, consisting of its Regional Consumer Banking (RCB) businesses and Institutional Clients Group (ICG), and Citi Holdings, consisting of its Brokerage and Asset Management (BAM), Local Consumer Lending (LCL), and Special Asset Pool (SAP). In April 2010, Barclays PLC acquired Italian credit card business of Citibank International Bank plc. In May 2010, the Company announced the creation of a new Collateral Management Services unit within its Securities and Fund Services business.

Citigroup (NYSE: C) Officials Knew About the Subprime Losses Faced in 2007 According to the SEC was created by and is property of American Consumer News.

Meanwhile, Citigroup led the country’s banking institutions for receiving the federal bailout money in late 2008 and the beginning of 2009. Citigroup received a total of $49 billion across three separate investment, more than any other bank.

The first half of the year, $2.78 million for lobbying federal regulations was spent by Citigroup when the banking regulations were at the forefront of the national agenda. Only one other bank also receiving government money under the Troubled Asset Relief Program (TARP) spent more on lobbying during the first half of the year, JPMorgan Chase.   JPMorgan Chase spent $1.52 million on their lobbying efforts in the 2nd quarter.  Of the 10 banks receiving the most bailout aid, the total spending on lobbying efforts in the first half of the year was over $16 million.

Was lobbying the best use of TARP funds?

Citigroup has been in discussion with federal agency officials and legislators over a wide range of topics, including Wall Street reform, student loans, mortgage reform, consumer overdraft protections and regulation of the credit card industry. Also in the disclosure report is indications that Citigroup has lobbied the federal government regarding patent reform and tax issues. Between April and June, the bank lobbied the White House, Federal Reserve, Congress, Council of Economic Advisors, the departments of the Treasuring, Housing and Urban Development, the Office of Thrift Supervision and the National Economic Council.

Reference:

Troubled Asset Relief Program Funds at Work: 2nd Quarter Lobbying Costs by Citigroup (NYSE: C) Reaches $1.47 Million was created by and is property of American Consumer News.

First, users of the Citibank Basic Banking account will be able to forego the monthly maintenance fees by simply making five qualifying transactions a statement period. These qualifying transactions include common daily uses such as ATM withdrawals, direct deposit, bill payments, auto deductions, and debit card purchases.

If these minimums are not met by customers then they can expect be charged an $8 monthly fee when November’s statement period begins. This should be considered in light of fact that earlier fees ranged from $3 to $8 a month in the past for checking customers.

Higher Level Accounts

Those who have Citibank’s mid-level accounts can expect fee waivers if they will keep at least a $6,000 monthly balance in their combined accounts. As with basic level accounts, a failure to meet this minimum balance requirement will result in higher monthly maintenance fees. Whereas in the past, mid-level accounts were assessed fees of $9.50 to $15, the new rate is $20.

Citigroup stated that its combined or linked accounts include checking, savings, credit cards, CDs, investments, mortgages, lines of credit and retirement accounts, among others.

For its top-level Citigold accounts, the package created especially for wealthy clientele, Citigroup has reduced the minimum monthly balance to $50,000 from the previous $100,000 balance requirement. The $30 fee (raised from $25) can be waived if the customer maintains the limit in all of their deposit-related linked accounts. Additional waivers are available to Citigold customers whole keep $100,000 in deposit accounts, investments, loans, credit cards, and lines of credit. (This option excludes first time mortgages or $250,000 in similar accounts plus the mortgage.)

A Change Of Strategy

This change of procedures is just a portion of the planned adjusts that are being made in Citigroup’s U.S. consumer banking businesses. The company said that it plans to focus particular attention on its U.S. retail business activity, even while developing its assets abroad.

All of this change has been a part of Citigroup efforts to make its retail checking account offerings more effective. In 2009, it began by reducing the number of account from six packages to four. Citibank EZ Checking account is one product that has ceased being actively sold.

Citigroup has been downsizing since it was nearly sunk by the financial crisis. (It needed $45 billion in bailout funds from the government to maintain operations.) The goal for Citigroup is to straighten out its balance sheet, eliminate complex business lines and concentrate on a small number of key businesses.

Reference:

Citigroup (NYSE: C) Still Involved In Restructuring Of U.S. Retail Sector was created by and is property of American Consumer News.

Citigroup’s CEO Vikram Pandit hopes that the measures will slow further reductions in consumer banking in North America. The company has dropped into a fourth position in deposit figures following its failed 2008 attempt to takeover Wachovia Corp. First half profits fell by 83%. Pandit made headlines back in January when he replaced Teresa Dial with Manuel Medina-Mora.

Citigroup’s U.S. retail-banking head added in an interview that, “If we offer a much better service than what our customers are getting today, they are going to bring more of their business to us.” He added, “By lowering the threshold to $50,000, it will allow us to offer Citigold to more customers.”

The Citigold Touch

When the Citigold accounts were first issued back in the 1980s, they required minimum balances of at least $100,000 to void the $25 a month fees. The accounts were geared towards wealth clients. They also include other amenities like a dedicated hotline, free checks, theater promotions and fee waivers on wire transfers.

The statement also pointed out that those Citigold customers who cannot meet the minimum balance will be assessed a $30 fee. Fees may be waived if a client’s balances – including a first mortgage – total $250,000. Citigroup’s standard-service accounts remain free provided the customers have accumulated combined deposits equaling at least $6,000. This also extends to credit-card balances, mortgages or retirement accounts.

The Bottom Line

According to Dinsmore, the transaction minimum has been developed to encourage customers to increase how often they use their accounts with the goal of using more of Citigroup’s services and potentially taking out loans. Dinsmore added, “If a customer does their day-to-day banking with Citi, they don’t have to worry about balances. They’re going to bring their business to us and they’re going to grow their relationships over time.”

Based on figures from their website, Citigroup currently has 13.3 million accounts, 1,002 branches and $145.5 billion of deposits. It has earned $84 million during the first half of 2010.

Reference:

Citigroup (NYSE: C) Plans To Lower Fees On U.S. Banking Accounts was created by and is property of American Consumer News.

Cancellation reasons indicated by Bank of America include insufficient documentation, payment defaults while in the trial payment plan, debt to income ratio below 31%, or homeowner income that is too low.

The Making Home Affordable Program is meant to modify mortgages to enable struggling homeowners opportunity to continue making payments on their homes and to keep their homes, despite their current economic and financial difficulties. Unfortunately, as the large number of cancellations from Bank of America trial modification’s alone shows – it’s difficult for homeowners to permanently modify their mortgage payments.

For homeowners denied loan modification under the Making Home Affordable Program, there may be an opportunity for alternative plan, to try and remain in the home – or for those who face foreclosure, an alternative such as a short sale or deed in lieu of foreclosure.

Bank of America is not the only servicer canceling trial modifications. In the same Making Home Affordable service report, J.P. Morgan Chase reports canceling 74,486 trial modifications. Citigroup (NYSE: C) canceled 77,502 trial modifications, after trying to work with homeowners who were upside down on their loans by reducing principal amounts owed on the loans.

Despite the imperfections of the Making Home Affordable Program, homeowners who have opportunity to get assistance through the program should make an attempt before entering foreclosure, especially if you are currently upside down on your loan. It may make it possible for you to keep your home and avoid foreclosure or bankruptcy.

July Making Home Affordable Servicer Report Shows 100,413 Bank of America (NYSE: BOA) Homeowner Trial Modification’s Canceled was created by and is property of American Consumer News.

Citigroup has reportedly tried working with homeowners to make payments more affordable by reducing principal amounts owned on the loan for consumers who were upside down on their loans. Bank of America (NYSE: BOA) is another lender who has been offering customer reductions. But not all lenders have been offering such reductions and not all homeowners will qualify for principal forgiveness plans.

Consumers and experts agree that these modification cancellations are one of the main issues facing the Make Home Affordable program. Critics do not feel the program has been making much of a difference and leaves homeowners stuck without many alternatives for help. Homeowners can not take advantage of the program because so many are being initially denied for the modification or finding that their trial modifications have been cancelled because they can not meet the payment requirements each month. Some homeowners are able to again an alternative payment arrangement after their modification loans have been denied. Others are forced into a short sale of their home to avoid foreclosure.

The Make Home Affordable program has had its share of issues but believe that homeowners still have the opportunity for assistance in getting mortgage help through the program. Homeowners are encouraged to seek assistance from the program if they are having trouble meeting their mortgage payments each month especially if they are upside down on their loans. While many have found it difficult to qualify for a trial modification program or have ended up with their trial plan being canceled, in order to stave off foreclosure, alternatives should be pursued before short sale or bankruptcy is considered.

Citigroup (NYSE: C) Cancels Home Loan Trial Modifications was created by and is property of American Consumer News.

The case is the first one that is focusing on whether or not banks disclosed information about their shaky finances to shareholders in an appropriate manner. The case also marks the first time the SEC has pressed charges against prominent banking executives who were involved in the subprime mortgage bond dealings including Citigroup’s former CFO Gary L. Crittenden and the former head of investor relations Arthur Tildesley, Jr. The SEC alleges both men omitted critical information in their disclosures to shareholders. Crittenden will pay a $100,000 fine and Tildesley is to pay a fine of $80,000.

Citigroup did not admit or deny guilt in the situation as is normal in settlement agreements. The company did state they were ‘pleased that we have reached agreement with the SEC to put this matter concerning certain 2007 disclosures behind us’. Citigroup also held Crittenden and Tildesley in high regard and clarified that the SEC did not charge the bank or either men with reckless conduct.

The settlement amount must still be approved by a federal judge in the District of Columbia. Earlier this month, Goldman Sachs agreed to pay out $550 million in a settlement over claims the bank deceived investors in a multifaceted mortgage deal. Bank of America also agreed to pay $33 million in fines which was rejected by a federal judge in New York, leading to a later settlement agreement in the amount of $150 million.

Citigroup (NYSE: C) to Pay $75 Million in Settlement of Subprime Mortgages was created by and is property of American Consumer News.

The circuit breakers were created after the May 6^th “Flash Crash” during which the Dow Jones Industrial Average dropped more than 1,000 points in minutes. The breakers result in a five minute pause in trading if any of the S&P 500 stocks move more than 10% from their price in five minutes.

At 1:03:51pm in NY, Bloomberg data shows an order of 8,820 Citigroup shares for $3.3174. The order was canceled due to the circuit breaker program, and the stock traded at $3.80 when the trading resumed. Yesterday, Citigroup shares closed at $4.

The purpose of the circuit breaker is to prevent declines in a security that might cause the volatility to snowball. Such an action can cause losses across various markets.

“It’s great that the circuit breaker picked it up and stopped everything, but how is an order that size allowed to print so far below where it’s trading?” said Alec Levine, an options strategist at Wallachbeth Capital LLC in New York. “If you did that for every stock you could effectively shut down the stock market.”

The program is being tested by the SEC. When S&P 500 company stock prices raise or drop 10% or more in under 5 minutes after 9:45am Eastern time, trading is paused for five minutes. The idea is to smooth out some of the volatility of the market.

On June 16, Washington Posts Company experienced a 99% surge which triggered the circuit breakers.

It’s believed that the SEC will be asked to broaden circuit breakers trigger point to 10% and to increase the companies which are part of the program to include more than just the S&P 500 companies. On May 6^th, there were nearly 20,800 trades at least 60% from the market price that were later canceled. About 70% of the securities were later voided by exchanges.

Citigroup (NYSE: C) Second Company to be Halted By Circuit-Breaker was created by and is property of American Consumer News.

Citibank (NYSE:C) held a live-streamed event entitled “Drive Sales and Word of Mouth Referrals Using Social Media” in response to a survey it conducted of small businesses. The survey results revealed that most small business owners did not know how to use social media to their advantage, and were not leveraging it as an effective marketing strategy for generating leads or sales.

The event was broadcast live over the internet with social media expert, Brian Solis, and celebrity makeup expert, Eve Pearl to more than 150 participants. The video of the webcast is now available online, at http://www.livestream.com/citismallbusiness.

Brian Solis is the author of “Engage: The Complete Guide for Brands and Businesses to Build, Cultivate, and Measure Success in the New Web” and the co-founder of the Social Media Club.

Eve Pearl contributes to Web sites, blogs, magazines and conferences as a beauty expert, and is a five-time Emmy Award winning celebrity makeup expert.

Participants and viewers of the video will discover the role of social media for growing businesses, and how to use it as a marketing strategy.

About Citi

Citi, the leading global financial services company, has approximately 200 million customer accounts and does business in more than 140 countries. Through Citicorp and Citi Holdings, Citi provides consumers, corporations, governments and institutions with a broad range of financial products and services, including consumer banking and credit, corporate and investment banking, securities brokerage, transaction services, and wealth management. Additional information may be found at www.citigroup.com or www.citi.com.

Citibank (NYSE: C) Helps Small Businesses Use Social Media was created by and is property of American Consumer News.

The Making Home Affordable program was developed to help the large amount of homeowners who were suddenly unable to meet the demands of their monthly mortgage due to the flailing economy, the high rates of unemployments, or the downfall of the mortgage industry. While Citigroup may be finding success, overall there are still many issues causing homeowners to still worry about their mortgage loan. With the rates of unemployment and the amount of people who are upside down on their home loans due to the real estate market, the Obama administration is looking to expand their mortgage assistance options.

New programs are set to be used over the next few months by a collection of lenders. Two such programs include assistance for principal reductions of mortgages and an underwater forbearance program. As homeowners are still struggling to make their monthly mortgage payments, there are some lenders who are not very keen on the new plans. Specifically many take issue with principal reductions. These lenders however are likely to offer programs in-house to help customers who can’t pay their mortgage bill each month.

One group that has used a principle reduction program is Citigroup. The company plans to continue with the program and providing their customers with solutions for assistance when they do not qualify for the Making Home Affordable program. Customers are continually seeking solutions that are quick and effective at solving their mortgage payment problems.

For homeowners who are looking for help, experts advise that consumers speak directly with their lender and inquire about the available programs. Many lenders are using a variation of different programs to help customers but not all homeowners will be eligible for each program. Homeowners are also advised to act quickly before falling behind on their debt, otherwise assistance may not be available down the road or the homeowner may not be eligible to receive help if too much time has passed.

Citigroup (NYSE: C) Successful in Modification Program was created by and is property of American Consumer News.

Citigroup is working in association with the Calvert Foundation and Opportunity Finance Network to help cover financing of both businesses and community development. The Calvert Foundation is a non-profit that manages money totalling more than $200 million that came from thousands of different investors. Opportunity Finance Network has also brough in more than $23.5 billion in financing since 2008.

Citigroup is set to provide $199 million in capital for small businesses using a combination of loans and equity. The other two grous will bring $1 millions to complete the balance. Vikram Pandit, Citigroups Chief Executive stated that small businesses, community service organizations, and other groups do not have the sufficuent access to the credit they need to keep growing.

The Communities at Work Fund will serve low income areas hand have been working for over 30 years to create economic opportunities in underserved communities by providing financing. They will provide financing to both for profit and nonprofit  Community Development Financial Institution (CDFI) Loan Funds that will then lend to local low-income communities businesses. The Fund will help maintain and grow businesses, drive new job creation and contribute to the economic recovery of communities can not secure financing by traditional financial institutions. To date, the loans have assisted more nearly 50,000 small businesses by loaning out a total of $15.9 billion. CDFI Loan Funds net charge-offs were lower than FDIC insured instituitons in both 2008 and 2009.

Andrew Ditton, Co-Head of Citi Community Capital stated “Citi is delighted to partner with Calvert Foundation and Opportunity Finance Network to deliver new liquidity for CDFIs. They are leaders in the field of community development finance with a proven expertise in responsible and profitable lending to those communities most in need of capital.”

As lending requirements have become much stricter, many entreprenuers can no longer survive in a community business. Once the businesses begin to fail, the community as a whole suffers. Citigroup is looking to strengthen both the businesses, their owners, and the communities in which they live.

Citigroup (NYSE: C) Ready to Lend To Small Biz was created by and is property of American Consumer News.

Former chief executive Chuck Prince told the federal commission “Let me start by saying I’m sorry. I’m sorry the financial crisis has had such a devastating impact on our country, I’m sorry that our management team, starting with me, like so many others, did not see the unprecedented market collapse that lay before us.” Prince was then followed by another former executive of Citigroup, Board Chairman Robert Rubin, who also expressed regrets about the failure to see what was coming.

However, the federal panel who are investigating the financial crisis wasn’t so quick to accept. They questioned why the executives did not take blame for the company’s near collapse. The apologies were given on the second of three hearing days on the subprime mortgage situation by the Financial Crisis Inquiry Commission. The duo did not take direct responsibility for leading Citigroup into the financial problems and said they were not aware of the situation until the fall of 2007 and blamed the problems on the influence of outside market forces.

Stated Rubin “Almost all of us in the financial system, including financial firms, regulators, rating agencies, analysts and commentators, missed the powerful combination of forces at work and the serious possibility of a massive crisis. We all bear responsibility for not recognizing this, and I deeply regret that.”

Members of the panel were not happy with the assessment of responsibility and several chastised the men for their failure to return the tens of millions of dollars in compensation each took before the company’s fall. Vice Chairman Bill Thomas said simple apology” isn’t enough “no matter how often you feel really, really sad.”

While the apologized bared little weight with the panel, Citigroup has been the most outwardly grateful for the bailout and has even publicly thanked the taxpayers for the federal money. Citigroup has also repaid $20 billion of the bailout money back. The Treasury Department has intentions of cashing in the remaining money that was converted into a $27 billon government ownership stake, which may result in an $8 billion profit for the government.

The inquiry panel is spending their three days worth of hearings focusing on the issues at Citigroup where other employers have been testifying about the warning signs with the subprime mortgages.

Citigroup (NYSE: C) Exes Not Sorry Enough Says Panel was created by and is property of American Consumer News.

Rhodes, 74, joined Citigroup in 1957. He graduated from Brown University and began to head a committee of international lenders. Through this committee, he negotiated debt restructurings for many countries like Brazil, Mexico, and Argentina. Rhodes also served as Citigroup’s senior international officer and assisted the bank in their expansion into Central and Eastern Europe and China. He played a critical role in helping Citigroup and the banking system recover from the LDC debt crisis in the early 1980’s. He also helped to reopen Citi offices in South Africa after President Nelson Mandela was elected. His service with Citigroup has earned decorations and recognition around the world for his international financial diplomacy. Mr. Rhodes spent 20 of his career years living in Latin America and in the Caribbean.

After departing from Citigroup, Rhodes will spend more time and focus at the William R. Rhodes Center for International Economics and Finance at Brown University. In 2007, Rhodes donated $10 million to the University and is a member of the Institute of International Finance’s Market Monitoring Group. He will continue devoting time to serving causes supporting free trade, cross-border capital flows, and as advisor to Citigroup’s own country heads around the world.

According to Richard Parsons, Chairman of the Board of Directors of Citi “Bill is a rare breed of banker, with more than 50 years of experience at Citi, We owe Bill a debt of gratitude for his service to Citi and look forward to continuing to utilize his expertise and receiving his counsel on a wide range of issues.”

“I have had the privilege of spending my entire career at Citi and the honor of representing the company during a number of critical phases in its history,” said Mr. Rhodes. “I am most proud of helping to develop the future leaders of this great institution. Further, I believe that Vikram has set the right strategic course for the company and that Citi is well-positioned for a bright future.”

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The sale is also another show of confidence since Wall Street began to recover from the recession. Citigroup was once one of America’s well-known financial institutions but has seen its share price collapse some 90% since 2006.

Citigroup itself had required three government rescues from both 2008 and 2009. The bank has received $45 billion in bail out money from the $700 billion Troubled Asset Relief Program (TARP) from the Treasury. The bank was given $25 billion in return for 7.7 billion shares and then was loaned another $20 billion, which it repaid in December. They were one of the last major Wall Street firms to pay back the TARP funds. They were forced to raise capital, which diluted the shareholders’ equity to come up with the repayment of the $20 billion dollars.

The sale will be underwritten by Morgan Stanley who was retained by the US Treasury and who will also advise on the sale process. The US Treasury has advised that the sale of stocks will be subject to market conditions and stated it ‘intends to sell its Citigroup common shares into the market through various means in an orderly and measured fashion.’ Experts believe the sale of shares will start after Citigroup reports results during next month.

The sale will not affect the Treasury’s holdings of Citigroup trust preferred securities or warrants for is common stock. Taxpayers hold about 27% of Citigroup’s common stock. The Treasury has said it would use a ‘pre-arrange written trading plan’ but did not state what that plan entailed. Citigroup is reportedly well-capitalized now and the company does not have plans to seek anymore financial assistance from the government. The opening share price of $4.39 on Monday will make the Treasury’s stake worth over just $33 billion, which gives an $8 billion profit to the US taxpayer.

Citigroup (NYSE: C) Bailout Shares to Be Sold was created by and is property of American Consumer News.

This program has been delayed for months, but once Citigroup (NYSE: C) came on board with the plan to reduce second mortgages for troubled borrowers, Bank of America (NYSE: BAC), Wells Fargo (NYSE: WFC) and JPMorgan Chase (NYSE: JPM) followed.
With nearly one in three homeowners currently underwater on their mortgages (according to Moody’s Economy.com), this program is long overdue, many critics believe. Home foreclosures have increased despite the Obama administration’s effort to prevent them. Previous attempts to reduce the number of foreclosures is a problem plagued by more than 100 different mortgage companies. The existing efforts saw 1.1 million homeowners applying for modification programs and assistance to keep their homes, but only 170,000 homeowners have been able to complete the process.

“We remain dubious about government mortgage modification efforts,” wrote Jaret Seiberg, an analyst with Concept Capital’s Washington Research Group. “So far none have lived up to expectations and we see little reason to believe the latest effort will turn out any different.”

This new mortgage loan forgiveness plan under the Obama Administration requires the mortgage companies participating to slash the amount of principal the borrowers owe, or eliminating second mortgages like home equity loans that have blocked many loan modification options for borrowers previously – in exchange for incentive payments from the government. Now that the big four players in the mortgage industry are on board, Citigroup, Bank of America, Wells Fargo and JPMorgan Chase – many people have greater hope for it’s success.

Citigroup (NYSE: C), Bank of America (NYSE: BAC), Wells Fargo (NYSE: WFC) and JPMorgan Chase (NYSE: JPM) Join the Obama Administration to Reduce Second Mortgage Balances was created by and is property of American Consumer News.

Of the 91,127 CitiFinancial residential mortgage loans that went unreported, 1,797 of them originated in Washington. Washington should receive $32,816.18 of the $1.25 million penalty.

The Home Mortgage Disclosure Act requires that lenders report the amount of loan, the location of the property, the ethnicity, race and gender of the borrower and whether or not the loan was approved for each mortgage loan application received.

The mortgage loans causing the penalties were omitted from CitiFinancial’s Home Mortgage Disclosure Act Loan Application Register were originated between the years of 2004 and 2007. The Conference of the State Bank Supervisors state the reason for under-reporting of the loans was due to an internal systems error in the company. It wasn’t until the Massachusetts Division of Banks conducted their examination that the company become aware of the error.

Now that CitiFinancial is aware of the error, they have corrected and resubmitted a completed Home Mortgage Disclosure Act report for 2004 to 2007 to the Federal Reserve System. Citigroup spokeswoman Molly Meiners said no customers were harmed, and the error was unintentional.

In addition to the $1.25 million penalty, the regulators are requiring that CitiFinancial bring in an independent consultant to review the data from the originally unreported 91,127 mortgage loan transactions with a thorough fair lending review to make sure the transactions do not demonstrate a possibility of CitiFinancial’s practice of discriminatory lending. In addition, CitiFinancial has agreed to iinvestigate and modify its internal control procedures in order to ensure that HMDA transactions are accurately recorded and reported in the future.

Citigroup’s (NYSE: C) CitiFinancial Pays $1.25 Million in Penalties for Failing to Report Mortgage Loans was created by and is property of American Consumer News.

As the hedge fund industry begins to bounce back, pensions and sovereign wealth funds are becoming some of the largest investments. Investors are making more direct investments in hedge funds instead of the old standby route of investing their funds from funds. As the trend progresses, Citigroup is preparing to help consumers in their demand for such management services.

Citigroup sees the move as an area of major growth and notes that the current profile of an investor is nearly the complete opposite of what it was two years previous. It is expected that the hedge fund industry will have its first net capital inflow since 2007, which financial crisis abounded. It may draw in as much as $222 billion in additional capital. Pension and sovereign wealth funds and foundations outpaced fund-of-funds and endowments. It was the funds-of-funds that were particularly hard-hit after so many had invested in Bernard Madoff, who is currently servicing a prison sentence of 150 years after being convicted of operating the biggest Ponzi scheme in history. With so many hurting from their losses, reinvestments of cash have been slow.

About two years ago, Citigroup was approached by Denmark’s largest pension fund ATP to develop a trading team. Moving forward, they plan to expand their one-stop services which include fund valuation, custody, trade clearing, and financing and maintaining managed accounts for investors to Asia. This will allow them to build up their in-house hedge fund consultant group.

The increases will likely double the current 30 person consulting team. Asia may get a uneven number of the additional team members as the bank works to expand their services from Europe and the United States into Asia. Citigroup sees the potential for demand of such services from Australia’s superannuation funds as well as from the large investment companies out of Singapore. The team is expected to go up to about 60 employees to support the new growth in the region. The prime finance consulting team is analyzing technology and how it must be altered to fit the needs of institutional client investors and help provide growth support for hedge fund managers.

Citigroup (NYSE: C) Ready to Grow Hedge Fund Group was created by and is property of American Consumer News.

According to Marc Jahr, the current president of the NYC Housing Authority, Citigroup has partnered with an affiliate to purchase 13 of the 21 projects. The projects in question are considered some of the worst, run-down apartments out of the group. Citi is taking on $360 million of the debt and has plans to re-market the rest. In addition, Citi will invest over 200 million dollars of equity into the 13 projects which should result in tax credits of $255 million off their federal tax bills.

All 21 projects were build with city and state funds after the second World War. As time has passed, the city and state stopped subsidizing the projects requiring the housing authority to use federal dollars set aside for other projects to pay for the upkeep. Over the years, the projects have fallen into disrepair making modernization necessary to bring the projects current with the times.

Mayor Michael Bloomberg has stated, “Nothing is going to change except for the better” and reminding people that “No one will be displaced. The land these developments occupy will always be used for public housing and nothing else.”

The renovation of these projects comes at a perfect time when the city’s unemployment rate is exceeds ten percent. With hundreds of renovations needed, this will provide jobs for countless workers. In addition to the repairs needed for the 13 projects that Citigroup is involved with, there are also 8 other projects which will be renovated through the New York City Housing Authority and the New York City Housing Partnership. It is expected that just under 500 million dollars will be issued to the New York City Housing Development in a period of three years in the form of tax-exempt bonds.

Citi To Help Rebuild New York City Public Housing (NYSE: C) was created by and is property of American Consumer News.

Wachovia Bank customers may not know how close they came to not having a banking institution. Last week, Wachovia Bank was running but with strong concerns that the bank would not be open for this week. Before any deals were being worked out, Wachovia did not have a source of liquidity and under those circumstances, the banks could not have opened their doors for business. Wachovia Bank has been working on a merger prior to the most recent events. Over the weekend, the Federal Deposit Insurance Corporation, otherwise known as the FDIC, put pressure on the bank to make a deal.

Close To Collapse from Withdrawals 

The urgency became apparent after the executives at Wachovia realized that after the failure of Washington mutual, many of the larger corporate clients made an unusual number of withdrawals on their account. The majority of the withdrawal came from account containing more than $100,000. This severally paralyzed Wachovia’s access to operating capital.

Several Deals on the Table

Wachovia was approached by Citigroup, who offered a deal with assistance from the FDIC. The original agreement involved Citigroup purchasing Wachovia’s operations and the majority of the assets. The FDIC planned to aid the sale. The wheels were set in motion but never fulfilled. Wachovia has since changed tactics and made the agreement to be acquired by Wells Fargo. One of the main reasons this current action was taken was due to the ability of Wells Fargo to seal the deal without the help of the federal government. Wachovia reportedly is pleased with the arrangements because without the involvement of the government, Wachovia Bank can stay primarily intact and taxpayers would not have to help pick up the tab.

The official bid was approved by the Wachovia Board on Thursday evening and must still be cleared by the shareholders of the bank. Wells Fargo does anticipate that government regulators will approve the deal and everything will be completed before 2009.

Forget Citigroup – Wachovia Acquired by Wells Fargo was created by and is property of American Consumer News.