With new injection of funds Citigroup SIVs can avoid the kind of forced selling at distressed prices – but how long as the banking and financial meltdown continues?
Tarin Mugabe
Oct. 19, 2007

Commercial and investment banking executives are at state of denial. They do not believe the euphoria that made them senseless investors and managers was not real – a bubble. The two hundred year banking cycle has seen its peak. Like in 1907 the banks are in deep trouble and many of them will disappear from financial radars over the next several years.

With new injection of funds Citigroup SIVs can avoid the kind of forced selling at distressed prices. They have managed to find funds that will keep them safe for now. But some analysts believe the temporary fix is short lived. They will have write the losses off eventually.

European Selling has started and is accelerating. The US financial institutions have decided to carry forward the problem into next several years. Perhaps many of these executives will retire by that time.

Tango Finance Ltd., one of the world's largest SIVs, has been selling assets. Rhinebridge, managed by an arm of German lender IKB Deutsche Industriebank AG is dumping assets to allow fast redemption by its clients.

Citigroup is facing massive problems. They are doing everything possible to avoid an embarrassing fall out.

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