Citigroup Buys Wachovia Assets

Citigroup became the largest bank in the US by total deposits on September 29 by agreeing to purchase the majority of Wachovia's assets. Citi, which already bought up Washington Mutual (WaMu), will pay US$2.16bn in stock and assume Wachovia's senior and subordinated debt, of approximately US$53bn. Citigroup will acquire more than US$700bn of assets of Wachovia's banking subsidiaries and will absorb US$312bn of mortgage-related and other Wachovia assets. The Federal Deposit Insurance Corporation (FDIC) will provide loss protection beyond that and in return for this risk ceiling, Citigroup has granted the FDIC US$12bn in preferred stock and warrants.

To read the full article, please choose one of the following options: