Citigroup launches ‘Don’t panic’ ad blitz as shares dive
Sunday 23 November 2008
Citigroup, the embattled financial giant, is taking out advertisements in major US newspapers today in an attempt to shore up customer confidence after a downward spiral in its share price raised doubts about its future.
The tactic comes as executives and US government officials huddled in meetings through the weekend to decide whether more radical steps were needed to restore order.
With $2 trillion in assets and 200 million customer accounts in more than 100 countries, Citigroup is one of the world’s most powerful financial institutions. Yet its shares lost 60 per cent of their value in five days as investors questioned whether it can absorb billions more in losses on loans and commercial mortgage investments.
Although governments typically insure depositors’ money, and although Citigroup has access to potentially unlimited funding from the US Federal Reserve or the government’s Wall Street bail-out fund, executives still fear that the bad headlines could cause panic.
The advertising blitz is designed to reassure. The company is running full-page ads that acknowledge “our financial markets have been tested in unprecedented ways”, but argue that the company’s strength is rooted in a broad range of businesses and the expertise of its staff. It says customers can look to Citigroup for “providing stability” and “securing the future”, and concludes: “Now, more than ever, you can feel confident that Citi never sleeps.”
President-elect Barack Obama’s pick of Timothy Geithner, president of the Federal Reserve Bank of New York, as the next treasury secretary has intensified the drama. In his current role, he has responsibility for regulating Wall Street banks, and the New York Fed was involved in talks this weekend on how best to shore up market confidence in Citigroup. Along with current Treasury Secretary Hank Paulson, Mr Geithner held conversations on Friday with Citi’s management about making a public expression of support, or providing a new infusion of government cash.
Other options include the possible ouster of Vikram Pandit, Citigroup’s unloved chief, and more radical surgery such as spinning off divisions or selling the bank. Some analysts said a solution had to be found this weekend, before trading resumes tomorrow.
- 1 President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
- 2 The 'Black Museum': After 150 years, public set to see exhibits from police’s grisly crime museum
- 3 Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations
- 4 Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
- 5 UK weather: 'Coldest night of the year' tonight as freezing temperatures plummet to -10C
President of Argentina adopts Jewish godson to 'stop him turning into a werewolf'
Exclusive: Abusers using spyware apps to monitor partners reaches 'epidemic proportions'
Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations
Sir Winston Churchill’s family begged him not to convert to Islam, letter reveals
AirAsia flight QZ8501 missing: Search for plane carrying 162 passengers from Indonesia to Singapore suspended overnight
Millions of Britons struggling to feed themselves and facing malnourishment
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Ukip member gets into Christmas spirit with Union Flag plea to Santa 'for our country back'
Nigel Farage: Ukip leader named 'Briton of the year' by The Times
Immigrants make UK racist, says Ukip councillor Trevor Shonk
iJobs Money & Business
Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...
Not specified: Selby Jennings: Quantitative Research | Global Equity | New Yor...
Not specified: Selby Jennings: SVP Model Validation This top tiered investment...
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...