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It appears this was leaked to the Wall Street Journal by a Citi executive.
http://online.wsj.com/article/SB124417114172687983.html
The Fed, in its recent stress tests of the nation's 19 largest banks, estimated that Citigroup could face up to $104.7 billion in loan losses through 2010 under the government's worst-case economic scenario. The test found that Citigroup could face nearly $20 billion in losses in its huge credit-card portfolio, which is suffering from rising defaults.
However, the Fed's conclusion that Citigroup needed to beef up its capital by only $5.5 billion to withstand a deteriorating economic environment surprised many investors and analysts, who feared the company faced a much steeper shortfall.
[..]
In public statements, Ms. Bair has declined to discuss Citigroup.
In private conversations with other regulators, FDIC officials have argued the government should be tougher on Citigroup. In what is becoming a classic Washington turf battle, the Comptroller of the Currency has countered that replacing the bank's management could be too disruptive. The agency, which oversees Citigroup's national bank division, believes Citigroup needs more time to implement its turnaround strategy.
In March, senior officials from the FDIC and Comptoller sparred over the confidential financial-health rating the government assigns to the company's Citibank unit, people familiar with the matter said. The FDIC wanted the rating lowered, these people say. Banks rated a 4 or 5, on a scale of 1 to 5, are deemed "problem banks," which means they're at greater risk of failure.
Government officials decided to keep Citigroup off the "problem" list at the end of March, which became clear after the FDIC disclosed that the 305 banks on the anonymous list had a total of only $220 billion in assets, meaning Citi couldn't be among them.
Still, Citigroup officials believe that the FDIC will push them onto the "problem" list if they don't remove Mr. Pandit and his team. They fear being on the list could limit Citigroup's access to federal programs and prompt trading partners and clients to yank business.
However, the Fed's conclusion that Citigroup needed to beef up its capital by only $5.5 billion to withstand a deteriorating economic environment surprised many investors and analysts, who feared the company faced a much steeper shortfall.
[..]
In public statements, Ms. Bair has declined to discuss Citigroup.
In private conversations with other regulators, FDIC officials have argued the government should be tougher on Citigroup. In what is becoming a classic Washington turf battle, the Comptroller of the Currency has countered that replacing the bank's management could be too disruptive. The agency, which oversees Citigroup's national bank division, believes Citigroup needs more time to implement its turnaround strategy.
In March, senior officials from the FDIC and Comptoller sparred over the confidential financial-health rating the government assigns to the company's Citibank unit, people familiar with the matter said. The FDIC wanted the rating lowered, these people say. Banks rated a 4 or 5, on a scale of 1 to 5, are deemed "problem banks," which means they're at greater risk of failure.
Government officials decided to keep Citigroup off the "problem" list at the end of March, which became clear after the FDIC disclosed that the 305 banks on the anonymous list had a total of only $220 billion in assets, meaning Citi couldn't be among them.
Still, Citigroup officials believe that the FDIC will push them onto the "problem" list if they don't remove Mr. Pandit and his team. They fear being on the list could limit Citigroup's access to federal programs and prompt trading partners and clients to yank business.
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