Charles Prince and Robert Rubin, often blamed for bringing down Citigroup, expressed deep regrets for Wall Street’s meltdown in 2008 but did not take responsibility for the firm’s massive losses and the eventual taxpayer bailout at a hearing yesterday.
“I can only say that I am deeply sorry that our management -- starting with me -- was not more prescient and that we did not foresee that lay before us,” Prince, Citi’s former chief executive, told a US Congressional panel probing the causes of the financial crisis.
Bad bets on repackaged debt securities, consumer loans and other assets forced Citigroup to take three separate government rescue packages totaling $45bn, more than any other major bank received. When the dust settled, taxpayers (£29.4bn) held about a third of Citigroup’s common stock and $27bn of its debt. Rubin, a former Citi adviser, and former US Treasury Secretary, told the Financial Crisis Inquiry Commission, that he had deep regrets for not recognising the potential for a massive financial crisis.
But both Prince and Rubin said everyone involved in the financial system, including regulators and credit rating agencies, bore responsibility for the banking crisis.
City A.M. Reporter