Citi: Wells Fargo blocked from buying Wachovia

[cal04]

Source: Associated Press

The fight over control of Wachovia intensified Saturday, as a judge temporarily agreed to block the sale of the bank by Wells Fargo, Citigroup announced in a news release.

State Supreme Court Justice Charles Ramos issued the order blocking the sale of Wachovia Corp., which Wells Fargo & Co. had agreed to purchase in a $14.8 billion deal.

Citigroup Inc. accused Wells Fargo of trying to cut off its earlier takeover offer of Wachovia's banking operations for $2.1 billion in a deal struck with the assistance of the Federal Deposit Insurance Corp. On Friday, four days after that deal was struck, Wells Fargo said it was buying Wachovia.

The litigation pits two of the largest remaining financial institutions against one another as the ongoing credit crisis leads the federal government to arrange marriages and sales among banking entities.

Read more: http://news.yahoo.com/s/ap/20081005/ap_on_bi_ge/wells_fargo_wachovia

[Doctor Cynic]

1. Two bold guys arguing over a comb. n/t

[fujiyama]

2. Haha Great analogy

[Skink]

3. Citi seams to be rushing to become a regular bank.

Is it because now with FDIC insurance up to 250 banks can use regular deposits to invest with government backing? I thought they always did that anyway.
On Bill moyers last night his guest said the S&L crisis happened when FDIC insurance was raised from 40 to 100. is this right? The S&L thing occurred right before I started paying attention to politics.

[adarling]

4. i don't think so

they shouldn't have a say because if there is a sale of a bank that puts up the collateral not using fdic money then the sale will go through. citibank shouldn;t have a say in it..its very strange...plus i want it to happen. I have accounts in both banks and it will be perfect now, wellsfargo is on the west coast and texas and wachovia is on the east coast and texas. its a good merger...for me at least :)

[CreekDog]

5. at least the Wells deal won't cost the gov't anything

and it's funny that the gov't came up with the worse deal in the sale of Wachovia --worse for Wachovia, worse for taxpayers and better for Saudibank, er, i mean Citibank. :eyes:

[IthinkThereforeIAM]

6. Wells deal will cost the govt billion$...

... in lost tax collections due to a new tax law passed. There is another thread on DU dealing with that. Why do you think Wells Fargo can suddenly offer such a substantially larger amount, ...ie, over $14 billion vs Citi's $2.1 billion?

[dipsydoodle]

7. Surely the same will apply to Citigroup

as losses became apparent. The other thread you mentioned is here : http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=3526863&mesg_id=3526863

Given that the sellers have a duty of care to it's shareholders I don't see how the Wells bid can be voided.

[Demeter]

11. I'd Call It Suspicious, but Not Funny At All

Paulson should be run out of town on a rail and deprived of all post-govt. employment benefits. The man is crooked.

[NeoConsSuck]

8. The undercard bout shows some promise also

California vs. New York.

Gov. Patterson in NY was counting on Citi acquiring Wachovia so NY would reap the tax revenues of Wachovia. If Wells takes them over, Wachovia tax revenues go to California.

Both states are really hurting under this Republican mis-administration.

[Zorro]

14. Yes this will be interesting to see how this all unfolds

I have the impression that both Citi and Wells Fargo are run by tough SOBs, but that Citi's balance sheet is weaker than WF.

I read this morning that Citi is threatening to file a $60B lawsuit against both Wachovia and Wells Fargo.

Everyone is going to be playing hardball, with the government as the umpire.

[Proletariatprincess]

9. Always something fishy about Citigroup

None of the banks are good corporate citizens, but Citigroup is the worst of the worst with ties to Bush and the Republicans. Never trust anything that Citigroup does or says.

[whistle]

10. Boy, that is smelling a lot like fascism...is Wachovia Corp in receivership?

[Name removed]

12. Deleted message

Message removed by moderator. Click here to review the message board rules.

[mwooldri]

13. The FDIC should step in...

... and tell Citi that it isn't backing its bid to take over the part of Wachovia that it wants.

FWIW I am a Wachovia customer - I have a checking account (not a lot in there though) and a company managed 401k (again, not a lot in there). Personally I'd prefer a Wells Fargo takeover to a Citi takeover.

[kiranon]

17. Agree. Citibank deal not as good as Wells for everyone

The last thing we need is a lawsuit between Citibank and Wells Fargo. The Wells Fargo deal is much better for Wachovia shareholders (I own no Wachovia or Wells Fargo shares) and customers. I have an account at Wachovia and would like this matter resolved or will withdraw all my Wachovia funds and put them in Wells Fargo thereby getting the better part of the deal.

[cal04]

15. Wachovia says it will press ahead with Wells deal

http://news.yahoo.com/s/ap/20081005/ap_on_bi_ge/wells_fargo_wachovia

Wachovia Corp., at the center of a fight between Wells Fargo & Co. and Citigroup Inc. over who will buy the beleaugered bank, said Sunday it is pressing ahead with its deal to sell its banking operations to Wells Fargo.

Wachovia responded to a judge's order Saturday temporarily blocking the sale of the bank to Wells Fargo, saying it does not believe the order "has any effect on the validity of the Wells Fargo agreement with Wachovia."

(snip)
Wachovia spokeswoman Christy Phillips-Brown said in a statement the company believes its agreement with San Francisco-based Wells Fargo is "proper, valid and ... in the best interest of shareholders, employees and the American taxpayers."

She said Citigroup is free to make a better offer to Wachovia under that agreement.

[barbtries]

16. ironically

i banked at WF for years. i've never had the stomach to sit down and figure out all the money they got for nothing. i moved to NC, got my account at wachovia and ended my relationship with WF just a few months ago, and now they're coming back to haunt me.

anyone know of a nice, small bank in NC?

[mcollier]

18. Watch the walls come crumbling down on

one of these banks in the next few weeks.

[OakCliffDem]

19. Meanwhile the rich financial professionals are getting their year end bonuses at taxpayer expense

[Lance_Boyle]

20. BB&T n/t