After losing Wachovia to Wells Fargo, Citigroup is again looking to buy a bank to bolster its deposit base in the face of continuing economic turmoil, reports the Wall Street Journal. The latest target is a regional bank considerably smaller than Wachovia. Citi recently drew $25 billion from the Treasury Department’s $700 billion bailout fund.
Acquiring more US deposits has become a focus for CEO Vikram Pandit, as Citigroup has hemorrhaged $20.25 billion over the past four quarters and is facing increasing losses from its huge international business. Citi has operations in 106 countries and has seen accelerating consumer defaults in some; others are just beginning to be affected by the global financial crisis. "It's going to get a lot worse everywhere," says one analyst.