Citigroup Inc (NYSE:C) had recently been into a huge problem when the US federal announced an inquiry in its mortgage securities. However it seems like both parties have now agreed to a settlement in this issue.
Dominic Chu of CNBC reported on this and he said that the deal might be a multi-billion $ deal between the US and Citigroup Inc (NYSE:C) courtesy of Dow Jones. The deal would resolve the mortgage problems in the US.
A Dow Jones report says that the settlement talks related to the sale of mortgage securities between the US and Citigroup Inc (NYSE:C) could happen as early as next week. This settlement comes after the US threatened to file a suit against the company related to the mortgage securities issue. Citi is expected to pay more than $4 billion to resolve the issues.
“This is all courtesy of Dow Jones, The US and Citigroup are near a multi-billion dollar deal to resolve mortgage problems here. “ Chu said.
The stock is currently very much in focus for a lot of investors and it is a large cap which would impact a lot of investors in the market. The stock was up 1% after an hour of this news coming out. The government was looking for a deal of about $10 billion while Citigroup Inc (NYSE:C) was offering upto $4 billion. So this can actually be termed as a win for Citi.
The timing of this announcement is crucial because the company is reporting earnings soon and this can act as a boost for the stock and help the company retain the faith of the investors. The key investors in Citigroup Inc (NYSE:C) are Appaloosa Management Lp with over 10 million shares in the company, Masters Capital Management with about 6.2 million shares and Toscafund Asset Management with approximately 4.9 million shares as of March 31st 2014. These investors would be keeping an eye on the earnings to be announced soon .