Citigroup details new loan commitments after U.S. infusion

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Citigroup Inc. is out today with a 43-page report that seeks to refute that the bank isn’t doing enough to boost lending and help the economy.

Citi, which has gotten $45 billion in government capital infusions and an additional federal guarantee on more than $300 billion of its troubled loans, says it has committed an initial $36.5 billion for lending programs as a result of the government’s help to bolster the bank’s finances.

‘Americans from all walks of life are facing real economic hardship, and Citi must do whatever we can to help them,’ Citi Chief Executive Vikram Pandit said in a statement. ‘Our responsibility is to put TARP capital to work quickly, prudently and transparently to support U.S. consumers, businesses and our communities during these challenging times.’

TARP is the government’s $700-billion Troubled Asset Relief Program that Congress approved last fall.

Of the total $36.5-billion lending commitment, Citi said $25.7 billion has gone or will go toward home mortgages and purchases of mortgage-backed securities.

Of course, $45 billion in capital normally should support new lending of perhaps 10 times that sum. That’s why Citi was careful to note that the $36.5 billion commitment is the ‘first stage’ of what it hopes to do now that Uncle Sam has become a major stakeholder in the bank.

Citi’s non-government shareholders don’t seem impressed: Citi’s shares were down 16 cents, or 4.4%, to $3.49 at about noon PDT, amid another broad sell-off in financial shares.

Among other major banks, Bank of America Corp. was off 63 cents, or 10.5%, to $5.37 and Wells Fargo & Co. was down 85 cents, or 4.4%, to $18.38.

The report today is a reminder to Wall Street of just how beholden Citi and other TARP-recipient banks are to U.S. taxpayers.

-- Tom Petruno