US government bails out Citi

US treasury secretary Hank Paulson tries a new approach in an effort to rescue Citi from collapse and kick-start a recovery.

Vikram Pandit and Citi's other top executives closed the biggest deal of their careers on Sunday night, finalising an agreement with the US government that guarantees up to $306 billion in assets, adds $40 billion of capital and keeps them in charge of the troubled bank.

Citi's senior bankers thrashed out the details of the rescue during weekend-long crisis talks with officials from the US Treasury, Federal Reserve and the Federal Deposit Insurance Corporation after the bank's share price collapsed...

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