To some it comes as a surprise, to others it was inevitable. Citigroup (C) did cut its dividend by 41% today thanks to a record loss of $9.83 billion, yes I said billion. Where do they go from here?
The company announced it is selling $14.5 billion in preferred stock in order to raise capital and it had already raised $12.5 billion in private investments. I really hope they took all their lumps this quarter, but many seem to feel this is just the beginning as Citi still has another $36 billion in collateralized debt obligations. The shares were down another 7.3% today.
Meanwhile, US Bancorp (USB) released earnings today as well. USB has been able to keep its head above water so far. They actually made a profit of $942 million, which was down 21% from last year. USB also RAISED its dividend 6.25%. The Financial Skeptic has a good take on USB as well as The Div Guy.
Disclosure: Long Citigroup (unfortunately) and US Bancorp
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