Citi selling more stock

Discussion in 'Stocks' started by crgarcia, Apr 29, 2008.

  1. Citi selling more stock

    Citi (C) is raising more cash. The bank said late Tuesday it would sell $3 billion in common stock to the public in a bid to “optimize our capital structure,” as finance chief Gary Crittenden put it. The news comes just weeks after Citi, hit by billions of dollars of losses on mortgage-related securities and rising credit losses in its consumer business, raised $6 billion by selling preferred stock.

    Citi said the two most recent capital-raising efforts will boost its Tier One capital ratio, reflecting the ratio of core equity capital to total risk-weighted assets, to 8.5%. Shareholders tend to like preferred stock sales better than common ones, because they can mean less dilution of existing ownership stakes. But Citi indicates it is ”pleased with the strong interest we have already received regarding this issuance,” Crittenden said. Investors were less pleased, sending the stock down 3% in late trading.