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Pros Drill Down on Citi, BofA Results

CNBC.com
Friday, 16 Jan 2009 | 8:09 AM ET

Bank of America and Citigroup both reported worse-than-expected losses for the fourth quarters Friday, including billions of dollars of writedowns from exposure to debt and real-estate markets. Experts give CNBC their reactions to the results.

Citi is "Fine"

"Citi operationally is fine. The customers are fine. The depositors are fine. The regulators are on the case," Christopher Whalen, Institutional Risk Analytics said. "The investors have issues. We as a country have to figure out how this all going to work out."

Citi Plans to Restructure - Again

Citigroup reported a wide-than-expected $8.3 billion loss for the fourth quarter and announce it would restructure its business. "The funny thing is Citi just got done with restructuring a couple years ago. They actually streamlined the business pretty well," Christopher Whalen, Institutional Risk Analytics said.

BofA Aid Planned & Expected

The news that Bank of America will receive $20 billion in fresh government aid to help it absorb Merrill Lynch was expected as early as last December, says Uwe Parpart, Asia strategist at Cantor Fitzgerald.

Citi's Sale of Smith Barney a Bad Deal

The sale of Smith Barney is a bad deal for Citigroup, opines King Lip, portfolio manager at Baker Avenue Asset Management. He makes his case to CNBC.

BofA Taps Govt Funds - Again

"The government hasn’t got any choice, they have to save the banking system here," Jacob Schmidt from Schmidt Research Partners told CNBC after Bank of America tapped government funds for the second time. "It's just the US way of nationalizing," Schmidt added.

Bailing Broken Banks

Bank of America may receive another $15 billion in federal aid to help absorb Merrill Lynch, reports CNBC's Steve Liesman. Michael Farr, of Farr, Miller & Washington, and Mike Holland, of Holland & Co., share their insight.

Is Nationalization the Answer?

Citigroup and Bank of America's recent actions are just the start of a trend among large banks, Anthony Fry from Evercore Partners told CNBC. In his opinion, nationalizing the banks does not solve the current problem. The real pressure point is on the shoulders of the big companies, not small businesses, he said.

US Senate OKs Release of Remaining TARP Funds

Expect an initial bout of dollar weakness after the U.S. Senate voted to release the second tranche of the TARP funds, says Nick Bennenbroek, head of currency strategy at Wells Fargo.

  • Bank of America Gets $20 Billion, Merrill Loses $15 Billion
  • Citi Loses $8.3 Billion, Will Reorganize into 2 Units
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