This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Is Citigroup Even Worse Than Bank of America?

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( InvestorPlace) -- Plenty of ugly headlines have been written about Bank of America (BAC - Get Report) lately.

There's the galling hubris of CEO Brian Moynihan , stating that the public is too quick to criticize such an altruistic bank. There's the panicked race to recapitalize, including $5 billion from Warren Buffett and the sale of a roughly $10 billion stake in China construction bank. There was an infuriating plan to gouge BofA customers $5 a month for a debit card, which has since been replaced by a less obtrusive campaign to nickel-and-dime them to death.

Throw in the -55% performance of BAC stock year-to-date, and a -90% flop from the pre-recession peak, and you've got lots of reasons to hate Bank of America. However, lost in the noise may be the fact that BofA isn't alone in its antics. There are just as many reasons -- perhaps even more -- to dislike Citigroup (C - Get Report).

  • Also see: Why the EU debt crisis matters to us
  • Still Too Big to Fail

    The financial giant was the biggest recipient of government largess amid the TARP bailouts, with the federal government owning a 36% stake at the worst stage of the downturn. Some $25 billion in emergency aid was converted into common shares, which have since been sold as Uncle Sam has exited the "investment" in Citi stock. That alone should make folks just as leery of Citigroup as Bank of America when it comes to "too big to fail" institutions that seem to profit while average Americans suffer.

    The irony is that Citi may now be even bigger than before, meaning it has only a better chance of needing a government handout in the event of another shock.

    According to The Banker magazine, data from the end of 2010 shows Citi as the fourth-largest bank in the world. The consolidation in the financial industry has made Citigroup even more entrenched than before.
  • Also see: 2 U.S. sectors to shield you from Europe
  • Still Adding to Layoffs

    Mammoth size doesn't stop Citi from squeezing out more profits. Most recently, news reports say it will cut more than 3,000 workers. That's a fraction of the 30,000 layoffs Bank of America is working out, but let's not forget a brutal slash-and-burn at Citigroup in late 2008 that resulted in some 50,000 pink slips and planned eliminations.
    1 of 3

    Check Out Our Best Services for Investors

    Action Alerts PLUS

    Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

    Product Features:
    • $2.5+ million portfolio
    • Large-cap and dividend focus
    • Intraday trade alerts from Cramer
    Quant Ratings

    Access the tool that DOMINATES the Russell 2000 and the S&P 500.

    Product Features:
    • Buy, hold, or sell recommendations for over 4,300 stocks
    • Unlimited research reports on your favorite stocks
    • A custom stock screener
    Stocks Under $10

    David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

    Product Features:
    • Model portfolio
    • Stocks trading below $10
    • Intraday trade alerts
    14-Days Free
    Only $9.95
    14-Days Free
    Dividend Stock Advisor

    David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

    Product Features:
    • Diversified model portfolio of dividend stocks
    • Updates with exact steps to take - BUY, HOLD, SELL
    Trifecta Stocks

    Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

    Product Features:
    • Model Portfolio
    • Intra Day Trade alerts
    • Access to Quant Ratings
    Options Profits

    Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

    Product Features:
    • Actionable options commentary and news
    • Real-time trading community
    SYM TRADE IT LAST %CHG
    BAC $16.31 -0.31%
    C $53.42 0.26%
    JPM $64.21 0.12%
    AAPL $114.24 0.84%
    FB $90.55 -0.51%

    Markets

    Chart of I:DJI
    DOW 16,602.84 -40.17 -0.24%
    S&P 500 1,981.01 -7.86 -0.40%
    NASDAQ 4,812.3350 -15.99 -0.33%

    Free Reports

    Top Rated Stocks Top Rated Funds Top Rated ETFs