Citigroup 1Q08

Citi posted a first quarter loss of $5.11 bln, or $1.02 per share (Bloomberg, WSJ). But take, for example, the headline write-down number of $6 billion. Nice headline, but if you look through all the numbers and add them up the total write-downs are actually $15 billion. Source

* Writedown of $6 bln on subprime securities.
* Writedown of $1.5 bln on leveraged loans (the WSJ says $3.1 bln).
* Writedown of $1.5 bln on auction rate securities.
* Wrote down the value of bond insurance contracts by $1.5 bln.
* Reserves for future losses on consumer loans increased by $3 bln.

Citi's share price is rising on the assumption the worst is behind the company. But Citigroup has lost close to $15 billion in the last two quarters, and has suffered more than $46 billion in write-downs and increased credit costs since the middle of 2007. Book value per share, which measures assets minus liabilities, fell to $20.73 from $22.74 at year end. Return on equity was negative 18.6 percent in the quarter. Book value per share, which measures assets minus liabilities, fell to $20.73 from $22.74 at year end. Return on equity was negative 18.6 percent in the quarter. But Meredith Whitney puts tangible book value closer to $10/share at year end before these huge losses. When Bear Stearns collapsed on March 17 Citigroup hit a low of $17.99/share.