Saturday, March 1, 2014

This is where I came in

In the early 1970s, when I first started following American business trends, one of the big stories was the loss of $1,000,000,000,000.00, more or less, by American banks on really stupid loans South of the Border. A leader of these incompetents was Citi. I was not yet aware of Citi's long record, back to the days when it was National City Bank, of making bad loans in Latin America. Not just loans that, so to speak, went south, but idiotic loans, deals that the silliest country banker wouldn't touch. Citi took over from Barings, which had held the franchise for stupid loans in Latin America during the 19th century. Some things never change:
As far as I can understand it from Citigroup's press release, which is not very far, here's how Oceanografia S.A. de C.V. took Citi's Mexican subsidiary, Banamex, for $400 million:
Chump change these days but the principal (if not the principle) remains the same. Well, they say you can't con an honest man. That isn't universally true but I'd say it's true here since as reporter Matt Levine shows, Citi was unable to get its lies straight in its duelling press releases. Pretty funny if it wasn't your money.

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