Friday, according to media reports, financial services company Citigroup Inc. (C) is all set to increase the purchase of mortgages underwritten by other firms and retain more loans on its balance sheet as it reverses a plan to reduce home lending.
Citigroup now indicates mortgages as a core product, along with credit cards and consumer-banking staples savings accounts. Citigroup CEO Vikram Pandit moved the CitiMortgage unit into a new Citi Holdings division in January 2009 along with other businesses set aside for sale or restructuring.
Losses on home loans and write-downs on mortgage-backed bonds left the company with a record 2008 net loss of $27.7 billion following which Citigroup reduced residential lending to control further losses.
Reports suggest the bank is exploring ways to increase its growth in the consumer, corporate and investment-banking businesses. Pandit had opined earlier this month that the bank, which narrowed its loss to $1.6 billion last year, is well-positioned to return to profitability, driving up the company's stock price.
Citigroup had obtained $45 billion under the Treasury's bailout program in 2008, and has since repaid $20 billion last year.
Citi cut rates recently to attract more business on "jumbo" loans with more than $417,000 in most areas by one percentage point to 5.875%. The offer applied only for loans sold through branches and the bank's Web site. Some of the newly underwritten jumbo loans will be held on the bank's balance sheet.
Citigroup had $172.4 billion of North American home loans on its balance sheet as of December 31, down 12% from a year earlier. In January, the company announced plans to transfer $34 billion of U.S. mortgages from Citi Holdings to Citicorp, the division that contains the businesses the bank is keeping.
End last year, 8.3% of the bank's North American mortgages were more than 90 days past due, compared with 2.2% at the end of 2007.
C closed Friday's last trade at $3.90, down $0.12 or 2.99%, on a volume of 555 million shares. In after hours, the stock traded up $0.03 or 0.77%.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.