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Citigroup to sell, close some US branches: WSJ

(NEW YORK) Citigroup has agreed to sell its network of retail banking branches in Amarillo, Texas, and plans to shutter other branches in the United States, the Wall Street Journal reported on its website on Wednesday.Citibank, its retail banking unit, has agreed to sell branches in Amarillo to local lender Happy State Bank for an undisclosed sum, according to an internal memo, the Journal reported on its website. The newspaper said the company confirmed the deal.Citibank also plans to close at least 11 other branches in May, including six in Florida, three in New Jersey, and one each in California and Maryland, the Journal reported citing people familiar with the matter. A Citigroup spokeswoman was not immediately available to comment.Meanwhile, Dubai International Capital LLC (DIC), the state-controlled buyout company, said it has not been approached by Citigroup for capital raising after mortgage losses wiped out half its market value.DIC has ‘not been privy to any non-public information about the company’, the company said. ‘Dubai International Capital has never expressed an opinion on the investment merits or financial condition of Citi,’ it added.Citigroup received US$7.5 billion in November from Dubai’s neighbour, Abu Dhabi, and theNew York-based company said in January it was getting another US$14.5 billion from investors, including the governments of Singapore and Kuwait.It will take a lot more money to rescue Citibank and other financial institutions from losses  stemming from the collapse of the sub-prime mortgage market, DIC chief executive officer Sameer al-Ansari said on March 4.Citigroup fell 4.3 per cent that day to its lowest in nine years after Mr al-Ansari’s comments  and analysts at Merrill Lynch and Goldman Sachs Group predicted a first-quarter loss on further writedowns.But, on Wednesday, investor Robert Olstein said Citigroup will not cut its dividend further or raise more capital and the shares may double over the next two years.Citigroup’s stock, which has tumbled 55 per cent in the past year, is attractive even if the biggest US bank by assets reports another US$60 billion of writedowns and loan-loss provisions over the next two years, Mr Olstein told Bloomberg Television.‘Even though there’s bad news still to come in Citibank, it’s discounted already,’ said Mr Olstein, who oversees about US$1.3 billion as chairman of Olstein Capital Management. ‘This stock in two years is going to be in the mid-40s. You’ve got to be forward looking.’ Source: Reuters, Bloomberg (Business Times 7 Mar 08)

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