Blaming rumour-mongers for the sharp plunge in share price as well as for many other problems at Citigroup, its India-born CEO Vikram Pandit on Friday told key associates the bank was not considering a sell-out and continues to enjoy a strong capital position.
Seeking to allay concerns generated by various media reports that Citi was looking to sell itself in parts or whole, Pandit reportedly told some of his senior employees that he and the board wanted to keep the bank together, a media report said. According to an online report by British newspaper Telegraph, Pandit said “rumour-mongering remains at the heart of Citigroup’s problems”.
At the same time, investors continued to dump shares of Citigroup in early morning trade, in the midst of the crisis-ridden bank becoming the target of a slew of media reports indicating a possible distress sale in whole or parts.
A day after it lost more than a quarter of its value with a plunge of 26 per cent on Thursday, Citi shares on Friday fell again by over 20 per cent in the first half-an-hour of trade — reversing an early gain of over 5 per cent when some investors were seen cautiously buying Citigroup shares lured by expectations of a buyout offer.
A slew of media reports suggested Citigroup was holding a board meeting on Friday. The reported meeting follows a sharp plunge in the bank’s shares to below $5 level on Thursday for the first time in about 15 years, which wiped out over a quarter of its market value in a single trading session.