Analysis for Citigroup
I need help with this analysis.
The company is Citigroup financial banking.
Problem Statement and Underlying Symptoms
a. address the fundamental problem of the company in one sentence.
b. There are symptoms parading as key issues and underlying problems. Identify the symptoms that led to the main problem. Address these symptoms in a number of paragraphs.
...se symptoms in a number of paragraphs.
The loan loss reserves of Citigroup financial banking are significantly low. Consider the loan loss reserves of JPMorgan. This quarter these were 241 percent of nonperforming assets on the other hand Citigroup financial banking had its loan loss reserves at 121 percent. These need to be boosted significantly.
Citi has received several financial support loans from the federal government over the last year but is still reporting sharp increases in problem loans. This problem is especially large in their big credit card portfolios. The high cost of credit can erode the banks earnings and even get a Citigroup financial banking a poor rating on the regulatory stress tests.
Citigroup has reached a definitive agreement with the US government on loss sharing program. This means that Citigroup has to issue $458 in preferred stocks and warrants to the US treasury and the covered assets includes $301Billion of assets.
Even before the current crisis took over Citigroup, its reputation was sullied because of investigations into its banking practices. It ...