You might have gotten that impression from a Washington Post article published Saturday.
Take a look at the second paragraph of David Cho's piece on speculation that there's an imminent stock transaction about to transpire involving Citigroup and the federal government (h/t NBer armyfool1):
The Obama administration is making final preparations to sell its stake in the New York bank, according to industry and federal sources. At today's prices, the sale would net more than $8 billion, by far the largest profit returned from any firm that accepted bailout funds, and the transaction would be the second-largest stock sale in history.
"Its stake?"
Weren't these shares purchased with taxpayer dollars in a bailout of Citigroup?
As the Wall Street Journal reported in November 2008:
The federal government agreed Sunday night to rescue Citigroup Inc. by helping to absorb potentially hundreds of billions of dollars in losses on toxic assets on its balance sheet and injecting fresh capital into the troubled financial giant. [...]
Under the plan, Citigroup and the government have identified a pool of about $306 billion in troubled assets. Citigroup will absorb the first $29 billion in losses in that portfolio. After that, three government agencies -- the Treasury Department, the Federal Reserve and the Federal Deposit Insurance Corp. -- will take on any additional losses, though Citigroup could have to share a small portion of additional losses.
The plan would essentially put the government in the position of insuring a slice of Citigroup's balance sheet. That means taxpayers will be on the hook if Citigroup's massive portfolios of mortgage, credit cards, commercial real-estate and big corporate loans continue to sour.
In exchange for that protection, Citigroup will give the government warrants to buy shares in the company.
In addition, the Treasury Department also will inject $20 billion of fresh capital into Citigroup. That comes on top of the $25 billion infusion that Citigroup recently received as part of the the broader U.S. banking-industry bailout.
As such, this purchase was made with TAXPAYER funds, and done while George W. Bush was still in the White House.
A few months later, CNNMoney.com reported:
The U.S. government waded deeper into the bailout of one of the nation's largest banks Friday when it announced a deal that will give it control over as much as 36% of Citigroup's common stock. [...]
The deal will convert preferred shares that the Treasury Department already holds in Citigroup for common shares, a shift that is designed to improve the embattled bank's capital base, which in turn will hopefully allow it to increase its lending.
The U.S. government has already given Citigroup $45 billion in capital, for which it received preferred shares and warrants in the company.
The new deal Friday did not give the bank any additional taxpayer dollars.
So, it is actually the Treasury Department that owns this stake purchased with taxpayer dollars while Bush was President.
But that's not the impression one would get from Cho. In fact, Bush's name was nowhere to be found.
I guess any good that comes out of bailout decisions made by the former President will be credited to the current one by the Obama-loving media.
Funny how that works.
