@@@ Citi Group Will Hold onto assets in Emerging Markets @@@

Citigroup Has No Need to Sell More Assets, CFO Says (Update1)

By Paul Gordon and Philip Lagerkranser
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Nov. 25 (Bloomberg) -- Citigroup Inc. Chief Financial Officer Gary Crittenden said the bank will hold onto assets in emerging markets as it focuses on faster-growing regions after receiving a $20 billion government cash injection.

The company?Ts capital ratios are in the ?otop tier? among large U.S. banks after it raised funds and pared assets by $300 billion, Crittenden said in a Bloomberg Television interview today.

Citigroup received $306 billion of guarantees yesterday for troubled mortgages and toxic assets from the U.S. government to stabilize the New York-based bank, which has $2 trillion of assets and operations in more than 100 countries. HSBC Holdings Plc Chairman Stephen Green said yesterday the London-based firm would consider buying the ?oright? assets from Citigroup in the event of a break-up or sale.

?oFrom a capital standpoint there is no need for us to sell assets at this point, although wê?Tll continue to work away on non-strategic assets,? Crittenden said. ?oOur emerging markets franchise is the core of the company and our cash management network is the heart and soul of the enterprise.?

Citigroup?Ts crisis escalated as it was forced to take on its balance sheet a number of special units created to invest in riskier securities. The bank?Ts shares lost 60 percent last week and recouped some of those losses yesterday after the government?Ts rescue. Other U.S. lenders remain vulnerable.

?~Primary Focus?T

Wells Fargo & Co. is absorbing Wachovia Corp., the bank that regulators pushed in September to merge amid mounting losses from $120 billion in a portfolio of home loans. Bank of America Corp. has taken on both Countrywide Financial Corp., once the biggest independent mortgage lender, and Merrill Lynch & Co., the securities dealer hobbled by $24 billion of losses. Morgan Stanley slumped almost one-third in the past three months.

With reference to buying Citigroup assets, Green said ?oIt would depend,? in an interview at the Confederation of British Industry conference in London yesterday. ?oWe have a clear strategy to develop our business with a primary focus on emerging markets, and that means Asia, the Middle East and Latin America.?

HSBC earns more than three-quarters of its profit in emerging markets and has avoided the funding strain that?Ts led banks including HBOS Plc to be bailed out by the British government.

To contact the reporters for this story: Philip Lagerkranser in Hong Kong at lagerkranser@bloomberg.net
Last Updated: November 24, 2008 23:38 EST

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