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To Save Citi, Government Doles Out $306B Loan Guarantee, $20B of Cash
The government has tapped all its resources to save Citigroup, according to a Bloomberg report:
Citigroup Inc. will have more than $300 billion of troubled mortgages and other assets guaranteed by the U.S. government under a federal plan to stabilize the lender after its stock fell 60 percent last week.
Citigroup also will get a $20 billion cash infusion from the Treasury Department, adding to the $25 billion the bank received last month under the Troubled Asset Relief Program. In return for the cash and guarantees, the government will get $27 billion of preferred shares paying an 8 percent dividend.
The New York Times offers good coverage of the Citi rescue plan here.
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