Pandit takes measures to revive Citigroup

NEW YORK: Citigroup Inc is boosting its lending and has formed a committee to oversee how taxpayer dollars in the bank are being used, CEO Vikram Pandit says.

"We are increasing our lending and continue to make targeted consumer and commercial loans," Pandit said in a memo last evening to employees.

In the memo obtained by The Associated Press, Pandit said the company had formed a special committee of senior executives "who are responsible for overseeing, approving, and monitoring how the (Troubled Assets Relief Programme) investment is being utilised."

The largest US banks have been under fire by lawmakers and consumers alike for hoarding government funding to build up reserves instead of using it for loans. Spurring lending was the main aim of the government's financial industry bailout, which provided Citigroup and other large banks with as much as $25 billion each back in October.

Last month, as Citigroup's stock plunged on worries about its future loan losses, Citigroup got an additional $20 billion investment from the government, and a federal backstop for hundreds of billions of dollars worth of assets, mostly those tied to mortgages.



Pandit's memo did not identify which "senior executives" are on the new committee. Yesterday, The Wall Street Journal reported that federal banking regulators have tightened their scrutiny of Citigroup, becoming involved in discussions about the company's strategy and discouraging certain acquisitions.

The newspaper cited unidentified people familiar with the matter.