Citigroup Inc. posted nearly $10 billion in losses in the final quarter last year, the largest quarterly deficit in the bank's history, and cut its dividend in the wake of a huge write-down for bad bets on the mortgage industry.
The loss for the quarter totaled $9.83 billion, or $1.99 per share, compared with earnings of $5.13 billion, or $1.03 per share, during the same quarter a year earlier. Citigroup's revenue fell to $7.22 billion, down 70 percent from $23.83 billion in the final quarter of 2006.
It is cutting its quarterly dividend to 32 cents a share from 54 cents.
The 196-year-old financial services company wrote down the value of its portfolio by $18.1 billion.
Even more telling, it boosted loan-loss reserves by $4.1 billion, signaling further problems in its consumer businesses as deflated home prices, high energy and food costs, and rising unemployment weigh on people's ability to make their loan payments.
To cut expenses, it slashed 4,200 jobs in the fourth quarter in addition to the 17,000 layoffs announced in the spring, and CFO Gary Crittenden said more layoffs are in the offing.
It will raise capital by $12.5 billion with new investments from sovereign wealth funds and existing shareholders, including $6.88 billion from the Government of Singapore Investment Corp. for a 4 percent stake.
Other investors were Capital Research Global Investors, Capital World Investors, the Kuwait Investment Authority, the New Jersey Division of Investment, shareholder Prince Alwaleed bin Talal of Saudi Arabia and former Chief Executive Sanford Weill and his family foundation.
The $12.5 billion in fresh equity adds to the $7.5 billion that Citi received in November from the Abu Dhabi Investment Authority in exchange for a 4.9 percent stake in the company.