The big loser in the credit crunch?

Here's an interesting question: Just how costly will Citigroup's inability to close the Wachovia deal prove? Bloomberg notes that Citigroup will soon be relegated to the No. 4 position in the banking world, slipping behind the new big three of Bank of America, JPMorgan Chase and Wells Fargo--all of which enhanced their core franchises in the crunch. In the new banking universe, deposits are the key, the capital foundation upon which all else will be built. So what will Vikram Pandit do? Well, in the immediate future, he needs to shore up the bank's financial footing. The economic slowdown will certainly make that harder, though the bailout package will help. No one doubts that the firm will survive, but the transition may leave it the worst positioned of the big banks. Most people seems to think that Citigroup will need to make a big purchase of a consumer bank. If not, the Pandit era may be remembered as the one in which the bank moved to a lower tier.

For more:
- here's the Bloomberg article

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