Citi Faces $6-$10 Billion Write-Off; Prince Is Out Topics:Banking Sectors:Financial Services | Banks Companies:Bank of America Corp | Wachovia Corp | Bear Stearns Companies Inc | Morgan Stanley | Merrill Lynch & Co Inc | Citigroup IncBy David Faber | 03 Nov 2007 | 06:42 PM ET Citigroup faces a write-down in the range of $6 billion to $10 billion, mainly because of exposure to subprime mortgages and collateralized debt obligations, CNBC has learned. Citigroup will be parting ways with CEO Charles Prince, according to sources. -------------------------------------------------------------------------------- Citi Chief Executive Officer Charles Prince has already offered to resign from his post, according to a person familiar with the situation, and the financial services company's board is expected to accept his resignation at an emergency meeting scheduled for Sunday. The size of Citi's write-off is still being debated, though a source told CNBC that Citi's board is pressing company finance executives to clarify the issue. The firm's audit committee is also scheduled to meet Sunday, in advance of the emergency board meeting. No interim successor has been named for Prince, and while one candidate leads other prospects, the decision is still "up in the air," according the source. An interim leader will be designated while a full search begins immediately for a successor to Prince. The Wall Street Journal reported Friday that Robert Rubin is being considered as an interim replacement. But Rubin, the former Treasury secretary and current chairman of Citi's executive committee, has shown hesitancy about taking on the assignment.
Those write downs, are easily absorbed by C, if prince is out, this should send the stock up 4 points, maybe more!
Citi will rally a few bucks based off this... if the write off was 12-16 billion they'd prob. rally it even more!
Bad news already priced in, stocks are forward looking, they write off 10 billion and let go of Prince, the stock moves higher from here.
Jim Rogers, short all the financials, said on Bloomberg if they swap leaders he'll "have to cover on Monday". What I didnt get was, this was all over. Why not cover Friday and reshort. Anyway, Rogers says up. Then, probably short it again. This is running deep.