At the peak of the credit crisis in 2008 the government received 7.7 billion shares of Citigroup in return for $25 billion, and was repaid the $20 billion loan last December (TARP).

Late last year Citigroup announced millions of new shares to sell and at that time the government considered selling its stake as well. However, the treasury paid $3.25 a share and with the price at $3.15 a share the government would have lost $158.7 million so they backed out and decided to sell their shares systematically based on market conditions.

If the government is able to sell their stake at $4.25 a share they will earn $7.7 billion profit. Additionally, Morgan Stanley will handle the sale of those shares.

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From Linkedin:

One hypothesis is that many of the employees left the financial industry. According to the LinkedIn data set, that just isn’t true. There are a handful of people that did transition to other industries and start new careers, but most stayed in the financial space. To be specific, other than two acquiring companies (Bank of America acquired Merrill Lynch and Nomura acquired Lehman Brothers’ franchise in the Asia Pacific region), Barclays was by far the biggest beneficiary, scooping up 10% of the laid off talent, followed by Credit Suisse at 1.5% and Citigroup at 1.1 %.

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• JP Morgan: Jamie Dimon comes out on top with a $1MM salary and $17MM bonus (5 years restricted stock)
• Goldman Sachs: Lloyd Blankfein makes a $9MM bonus (restricted stock)
• Morgan Stanely: James Gorman makes a $9MM bonus and $800K salary
• Bank of America: Brian Moynihan makes a $950K salary and 0 bonus
• Citigroup: Vikram Pandit will take $1 dollar at his own request
• Jefferies Group: Richard Handler makes $12MM in bonus

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According to the FDIC bank failures from 2009 to 2013 is expected to cost $100 billion. Small(regional) banks are failing due to the loan losses from the credit boom. Many losses are result of the collapsed commercial real estate projects.

Brief Rundown;

Bank                                                                                               Assets                              Deposits

American Marine Bank (Washington)                                 $373.2 million              $308.5 million
First Regional Bank (California)                                           $2.18 billion                   $1.87 billion
Community Bank and Trust (Georgia)                                  $1.21 billion                   $1.11 billion
First National Bank of Georgia (Georgia)                            $832.6 million              $757.9 million
Florida Community Bank (Florida)                                        $875.5 million              $795.5 million
Marshall Bank, National Association  (Minnesota)         $59.9 million                 $54.7 million

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According to the FDIC bank failures from 2009 to 2013 is expected to cost $100 billion. Small(regional) banks are failing due to the loan losses from the credit boom. Many losses are result of the collapsed commercial real estate projects.

Brief Rundown;

Bank                                                                             Assets                              Deposits

Columbia River Bank (Oregon)                          $1.1 billion                     $1 billion
Charter Bank (New Mexico)                                $1.2 billion                    $851.5 million
Evergreen Bank (Washington)                           $488.5 million             $439.4 million
Bank of Leeton (Missouri)                                   $20.1 million                 $20.4 million
Premier American Bank (Florida)                     $350.9 million               $326.3 million

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It amazing to see the rapid rise in consumer debt. As mainstream attention remains on the housing crisis and loan defaults, its going to be very hard for the market to continue ignoring the current credit crisis.

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From the WSJ: Obama Proposes New Bank Regulations

The White House wants commercial banks that take deposits from customers to be barred from investing on behalf of the bank itself—what’s known as proprietary trading—and said the administration will seek new limits on the size and concentration of financial institutions.

… Banks shielded from risk through federal-deposit insurance, or aided in financial crises by low-interest loans from the Federal Reserve Board, would no longer be allowed to engage in trading unrelated to their customers’ interests, one senior administration official said.

Under the proposed rule, commercial banks would be prohibited from owning, investing in or advising hedge funds or private equity firms. Bank regulators would not be simply given the discretion to enforce such rules. They would be required to do so.

…
Administration officials said they also want to toughen an existing cap on bank market share. Since 1994, no bank can have more than 10% of the nation’s insured deposits. The Obama administration wants that cap to include non-insured deposits and other assets.

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According to the FDIC bank failures from 2009 to 2013 is expected to cost $100 billion. Small(regional) banks are failing due to the loan losses from the credit boom. Many losses are result of the collapsed commercial real estate projects.

Brief Rundown;

Bank                                                                             Assets                              Deposits

Barnes Banking Company (Utah)                        $827.8 million             $786.5 million
Town Community Bank and Trust (Illinois)     $69.6 million                $67.4 million
St. Stephen State Bank (Minnesota)                    $24.7 million                $23.4 million
Horizon Bank (Washington)                                $1.3 billion                    $1.1 billion

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