Citigroup will literally give away most of its hedge fund
unit, as it seeks to come into compliance with the Volcker rule.
The bank is giving a 75% stake in Citi Capital Advisors to
the division's employees under a plan negotiated by former CEO Vikram Pandit in
his final days at Citi. Those employees will not have to pay for it. Pandit, a
former hedge fund manager, spent much of his tenure building Citi's alternative
investments business, and CCA includes many of his former colleagues from
Morgan Stanley and Old Lane Partners.
Citi will retain a 25% stake in CCA, which will manage up to
$2.5 billion of the bank's capital, Bloomberg News reports. Citi will also pay
CCA's executives to manage its money while it redeems much of it to comply with
the Volcker rule, which strictly limits banks' hedge fund investments and bans
banks from proprietary trading…..
Read all about it at http://www.finalternatives.com/node/22461
No comments:
Post a Comment