While it's tempting to think that the Wells Fargo bid is superior to the Citi bid because it does not require government assistance, it may not be that simple. There are costs to taxpayers either way, according to some analysis by Stifel, Nicolaus & Co. analyst Christopher Mutascio. The AP reports his conclusion that the cost to the government for either deal would be about $21 billion. In Citigroup's deal, Mutascio figures the government would lose taxes totaling $14.7 billion on the first $42 billion in Wachovia's loan losses, as well as $18 billion in loan losses insured by the FDIC above the first $42 billion for which Citigroup is on the hook. That total of $32.7 billion is offset partly by $12 billion that Citigroup had agreed to pay the FDIC in preferred stock and warrants. In Wells Fargo's case, the losses stem from a newly granted tax treatment that would result in $21 billion in foregone taxes.

For more:
- here's the AP article
- report: Wells could get between 75 and 80 percent of Wachovia deposits. Article