Mergers & Acquisitions

Citigroup Finally Unravels...But Not Before Taxpayers Take $45 Billion Hit

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Daylife photo
Former CitiGroup Co-CEOs John Reed, left, and Sandy Weill, center, address the media with former Treasury Secretary Robert Rubin in this 1999 photo. Weill and Rubin continued to run Citi until 2006.

The nation's largest commercial banks have been at the epicenter of the credit crisis.  Last month, the most troubled of these banks, New York-based Citigroup, announced it was splitting apart into two segments basically undoing the mammoth merger of a decade ago.  John Reed, former Citicorp CEO, admits merger was "a mistake." 

On April 6, 1998, New York-based Citicorp and Travelers Group announced they were merging in an $82.9 billion deal which at the time was the largest in U.S. history.  The new financial behemoth which brazenly combined banking with brokerage and investment services and insurance with assets of $700 billion was called Citigroup. 

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