From: vikrampandit@citi.com
Sent: Friday, February 27, 2009 7:51 AM
Subject: Memo from Vikram
Dear Citi Colleagues,
Earlier this morning, we announced an exchange offer for our preferred stock that I believe will enhance our capital position and bolster public confidence in Citi, and by extension, our financial system. You will find additional details on the offering in the news release here.
As you’ve heard me say, we and our regulators were focused on Tier 1 as the capital that supports our businesses — and based on our Tier 1 of 11.9%, we have been very well capitalized. However, there is now a greater focus on tangible common equity (TCE) ratios, and that has translated into a market confidence issue.
The market’s loss of confidence in the financial system became a major distraction for all of us and I want to thank you for your perseverance in helping our clients see the facts about our financial strength and in keeping them as committed to us as we are to them.
Like all financial services companies, we will still need to navigate through the tough environment, but our announcement about our TCE today means that we should no longer be distracted by media and market speculation and that we can go back to leading from strength by focusing all of our attention on what really counts — excellent client service, unique and innovative solutions, and positioning our businesses to realize the full promise of Citi. My highest near-term priority is to return the company to profitability as soon as possible.
We are well on our way to doing that. We have strategic clarity as a result of the management separation of Citicorp and Citi Holdings. We have significantly reduced expenses and headcount and we continue to reduce risk assets. All of these steps will help the world see what we already see about what makes our company so special and unique — our people, our globality, and our strong client relationships that have been built over the past 200 years.
Our presence in 109 countries and our ability to link the world and help our clients with their needs anywhere in the world is our key strength. We are as committed as ever to our global franchise and believe that this is what distinguishes us from our peers. Our commitment to serving our clients and customers, especially in their time of need, is the nature of our company. For instance, in the U.S., we have played a leadership role in helping to keep families in their homes in a period of record home foreclosures. In fact, I think we should all be proud that we have kept over 440,000 families in their homes. And, we are committed to always being a systemically responsible company.
There has been a lot of talk about nationalization in the media. This is not a nationalization by any definition. The exchange offer and conversion we announced today does not represent additional capital from the government — it changes only the form of investment. The government’s stock ownership in the company will provide TCE as a bridge through this financial crisis and to profitability. We are responsible for our day to day operations and today’s announcement does not change our oversight relationships with our regulators. The government now holds a significant common stock investment in us and we intend to provide an exceptional return to them, along with all shareholders. For those who have been concerned about nationalization, today’s announcement should put their concerns to rest.
Many of us are shareholders and I want you to know that this was not an easy decision for us because we understand the impact of the dilution we’re asking shareholders to bear. But, in the end, our business is about confidence and I wanted to take definitive steps to alleviate capital issues. I promise you that I am committed to rebuilding value. I want to ensure that the turnaround of Citi is a wealth creator for all of you who are shareholders. Within the next 60 days we hope to announce a long-term plan to ensure that all employee shareholders participate in our success.
I have received thousands of emails from you encouraging me to not give up hope and determination. I never have. And because of the dedication I’ve seen from all of you, I never will.
Since 1812, Citi has confronted many obstacles and successfully surmounted them all and has emerged stronger for the experience. The last few months have been a difficult chapter in our very long history. It’s time for us to put this period behind us and be proud to be Citi again. I am.
Vikram
What he doesn’t say is that the thousands of e-mails all came from the same person.
“Knock it off already!”
(chest beat, chest beat, salute to you with my right fist, vikram)
keep the faith.
For the love of all that is good and holy, PLEASE give up, Vik.
They must have some petty good “good news” email filters at Citi. Google would be proud.
Maybe Google should acquire Citi for their tech prowess. Vik is from Asia after all.
@1 or the same, outsourced callcenter in mumbai…
SOMEBODY PLEASE TELL ME WHY THE FUCK CNBC HAS IVANKA TRUMP ON AS GUEST HOST!!
tnx.
@4 here.
If you believe the part about tech prowess coming from some regions of Asia then you deserve to lose everything in a Ponzi scheme run by ye ole’ Vik.
Because earlier Trump was on telling everyone we are in a depression – the only difference is the banks closed in the last one. WTF
Thanks shithead we needed that confidence.
Go play blackjack.
Asshole
What am I missing here? I think diluting the common stock is a good thing. Spread those losses out as C tanks… down 33% already today?
Vik – why don’t you spend more time moving this tanker off the shoals rather than writing “peppy” letters for the staff….
I work at Citi on one of the trading floors. No one is doing anything right now — except for calling everyone they know in the biz and asking for a job.
Shittigroup Bank of Obama. It’s all over but the crying. More importantly, Erin Burnett does not appear to have ruined those sweet perkies with bolt ons.
@12 what are you trying to say?
The surgery went well?
@6 to plug her father’s upcoming show, or is she on it as well? don’t you know everything about that family is shameless self-promotion? except… that georgetown brother seems to be the most rational and normal and will probably be the most palatable to watch.
.
I’ve been in a couple dozen meetings with Mr. Pandit a number of years ago. Never heard an enlightened thought come out of his mouth. However, in all fairness to the dude I don’t think a god could have pulled Citi out of its tailspin…..
@6 agreed.
Is “globality” a real word?
Is “globality” a real word?
Is “globality” a real word?
I love Memo Fridays
Ivanka Trump is to Market Insight as WideClops is to _________.
@23
peanut butter sandwich
Hold the phone. Can someone tell me WTF happen to the Citi ringtone?
http://dealbreaker.com/2008/08/ringtones_citi.php
I just got a new phone and was looking forward to downloading it.
Can you imagine emailing your boss and telling him/her “not to give up hope and determination”? Either they are a bunch of kiss-asses or they think their leadership is a bunch of lightweights.
How come no one here mentioned that Globality might not be a real word?
Ivanka Trump is to Market Insight as WideClops is to picnics, walks in the park, and spooning without socks on.
@27 because it exists in the urban dictionary
Erin Burnett’s clamans do appear to have grown over the past few months. Anyone have the #’s on 16 yr CPM’s?
-tgwwbh
@ 29 — so what, so’s THIS:
http://www.urbandictionary.com/define.php?term=Paulson
I’ll globality you!
Did a little research:
“Globality is a term in both academic and business use that refers to the end-state of globalization – a state in which the process of globalization is complete or nearly so, barriers have fallen, and a new global reality emerges.”
So Vik is right in one sense: a new global reality sure is emerging…
F*** you citi. I can buy you with the change in my drawer.
To summarize, and someone correct me if I’m wrong, “…if vote fails: holders get sweet-ass yield”
Interesting incentive structure there, eh?
… and hope that I never had?
“We have significantly reduced…headcount and we continue to reduce risky assets. All of these steps will help the world see what we already see about what makes our company so special and unique — our people, [etc.]…”
Good stuff.
Number 6 Six……..because they couldn’t get Maria Bartiromo.