The title is from breakingviews.com and I think the editor is humorous to link the latest development with Citi famous advertisement slogan.
Citi is paying 8 per cent dividend on US$20b of capital the U.S. government injected in the form of preferred shares. The housing loan board rate is about 4% in Singapore. How do they make profit from -4% gross returns from every loan dished out?
My formula is likely inaccurate, but, the cost of doing business by Citi is definately increasing.
The editor is quick to highlight that it isn't absolutely clear that Citi is out of the woods. As AIG has to come back for second time for rescue package, Citi may repeat it also.
As highlighted, the rescue doesn't address the diffuse concerns that the bank is either unmanageable or badly managed.
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