<http://money.cnn.com/2009/01/16/news/companies/loomis_citi.fortune/index.htm?postversion=2009011616>
With this spilt, it's clear on what Citi will be doing. Cutting down on toxic assets in Citi Holdings and concentrating on CitiCorp's core businesses. Share prices plunged to $3.50+ range and luckily, Bank Of America was attracting more attention with Merrill Lynch's massive loss.
A quote from the article:
"The other denizens of Citi Holdings are to include various consumer businesses that Pandit has never shown interest in retaining, such as insurer Primerica. Press reports have said that Primerica will be sold, but it's basically been on the market for a year and hasn't moved. Another loss-ridden company, American International Group (AIG, Fortune 500), is trying to sell a large number of insurance companies and, in today's credit environment, they are stuck right where they are, on AIG's balance sheet.
Citi Holdings is also to inherit the $300 billion of toxic assets on which the U.S. government is sharing losses. That's a package that Pandit will surely be thrilled to shed management responsibility for."
There's good and bad on this spilt in my opinion. Good thing is, Citi will have a very clear company goal on what they want to achieve, reason being the core concentration is in CitiCorp, with core businesses like credit cards, wealth management, the corporate bank and the investment bank.
Bad news is, whoever lands in Citi Holdings, you are more or less prepared to be sold off or laid off. When you separate your non important businesses away, more likely you won't want to keep it as it is more of an expense than a profit making unit. Especially during such bad times, such expenses should be kept as low as possible.
Another article on Citi:
<http://money.cnn.com/2008/04/18/news/companies/anyone_run_citigroup.fortune/index.htm?postversion=2009011616>
