Money | Citigroup Citi, Wells Fargo Clash With Feds Over Repaying TARP Fed, Treasury want banks to raise more capital first By Kevin Spak Posted Dec 8, 2009 6:54 AM CST Copied In this Feb. 11, 2009 file photo, Citigroup Chief Executive Officer Vikram Pandit, right, accompanied by Morgan Stanley Chairman and Chief Executive Officer John Mack, testifies on Capitol Hill. (AP Photo/Manuel Balce Ceneta, file) Citigroup and Wells Fargo are at odds with the government over how much they need to raise to repay their TARP bailouts, with Uncle Sam wanting them to raise more capital first. Both are looking to follow Bank of America’s lead and get out from under the TARP, allowing them to escape federal scrutiny of executive compensation, but they’ve been told to raise more relative to what they’re repaying than BofA did, the Wall Street Journal reports. Citi has strong capital levels, but isn’t as consistently profitable as BofA. The government also lent it more money, and guaranteed $182 billion of its portfolio against excessive losses. The Treasury wants Citi to raise an additional $20 billion in preferred stock—diluting existing shares 20%. “That’s a pretty tough pill to swallow,” says a person familiar with the negotiations. Wells Fargo was also told to raise billions in new capital. Read These Next Trump, Johnson aren't happy with pick for Super Bowl headliner. It's being called a disturbing trend: paragliders with bombs. Feds cite ChatGPT evidence in arrest of Palisades Fire suspect. Felix Baumgartner's death attributed to his own error. Report an error