Banking, finance, and taxes
Sovereign Funds Bring Bad Image With Cash (C)(MER)
Published:
Getting a much-needed investment when a company is in deep trouble is nice. But, when it damages the firm’s public reputation it takes away some of the joy of surviving.
According to the FT, "over half of the 1,000 people polled by the market research group Strategy One said they “trusted Citigroup (C) less” after its recent decision to tap Middle Eastern and Asian sovereign funds." The number for Merrill Lynch (MER) was almost as bad.
It seems that Americans don’t like the idea of foreign government funds owning a piece of their financial icons. Whether this effects the likelihood of people doing business with the two firms is not clear.
Perhaps Americans would rather go to their Citi branch and find it is closed.
It is better to have to go to Kuwait to get their money out.
Douglas A. McIntyre
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