NEW YORK: Goldman Sachs Group Inc is not interested in buying hard-hit Citigroup Inc, even with substantial US government financial support, a Competitive economies
Ghosts of 1929
2008: Year of global financial crisis
Other Fed tools against downturn
person familiar with Goldman's strategy said Friday.
Citigroup shares tumbled for a fifth straight day, closing Friday at a 14-year low and giving the once-mighty bank a market value of just $21 billion.
The plunging stock price fueled speculation Friday that the bank would have to find a buyer quickly or sell businesses to stay afloat. Citi's board met Friday to consider these and other options, though the bank ruled out a sale of brokerage unit Smith Barney.
Yet Goldman -- whose stock rose 2.5 percent Friday and which now has about the same market value as Citi -- continues to resist such a deal because it would be disruptive to Goldman's culture and could make it vulnerable to big losses from some of Citi's assets, the source said.
That reluctance has not changed since Goldman Chief Executive Lloyd Blankfein was encouraged by government officials to call Citi CEO Vikram Pandit. The call, which took place in September, lasted less than a minute and neither side was interested, people familiar with the matter said.
Even with the possibility of US government financial support, Goldman is reluctant, the source said. Goldman declined to comment, citing its policy of not responding to market speculation.
The US Treasury and Federal Reserve could still put pressure on a large bank -- only a few remain -- to carry out a private-sector rescue.
That power of persuasion was evident in March, when JPMorgan Chase & Co was urged to acquire Bear Stearns, with the Federal Reserve agreeing to absorb losses on a mortgage portfolio.