Shuffling Citi, Freeing Up Fannie
Citigroup poaches a retail banking chief from Lloyds TSB, as part of a broader shakeup. Fannie Mae and Freddie Mac are given permission to raise more capital. And free college is spreading to the masses, or at least those with Internet access.
NEWS AT A GLANCE
Citigroup reshuffles units
Citigroup, the largest U.S. bank, announced several high-profile departures and hires, part of an expected broad reorganization started by new CEO Vikram Pandit. In the biggest change, Citi has hired Terri Dial, the head of U.K. retail banking at Lloyds TSB, as its new global head of consumer strategy, The Wall Street Journal reported. (Reuters) Dial will be charged with turning around Citigroup’s flagging U.S. consumer banking operations. (MarketWatch) Citigroup also promoted Nick Roe to head its global equity finance and prime brokerage unit, replacing co-heads Ali Hackett and Tom Tesauro. Citigroup has lost more than half its market value in recent months. (Bloomberg)
Fannie, Freddie may raise up to $20 billion
U.S. government-chartered mortgage companies Fannie Mae and Freddie Mac can raise up to $20 billion in capital, according to their federal regulators. The Office of Federal Housing Enterprise Oversight (OFHEO) agreed last week to lower the amount of capital reserves held by the companies to 20 percent, from 30 percent, in a bid to shore up the housing market. (Reuters) Fannie and Freddie own or guarantee almost half the $11.5 trillion in U.S. residential debt. The $20 billion figure is at “the top end of the range,” said OFHEO director James Lockhardt. “We felt at this point it was important to add liquidity to the mortgage market.” (Bloomberg)
Mitsubishi enters plane market
Japan’s Mitsubishi Heavy Industries is building a midsize regional jet, the first passenger aircraft made in the country in three decades. The plane, made of lightweight composite carbon fiber, will carry 70 to 90 passengers. (AP in Yahoo! Finance) All Nippon Airways ordered 15 of the aircraft, for about $600 million, with the first plane expected in 2013. The aircraft will replace Boeing planes, at an expected fuel savings of 40 percent. But the real competition will be with Brazilian jet maker Embraer and Canada’s Bombardier. Japan will likely subsidize the enterprise. “Japan is a very expensive place to make aircraft,” said Indoswiss Aviation analyst Jim Eckes. (The New York Times, free registration)
Attending MIT, gratis
There may be no diploma in it, but free access to world-class education is spreading. Inspired by the volunteer-based open-source software movement, the Open Education Resources movement is backed by several prominent universities in the U.S., China, Japan, and Europe. The Massachusetts Institute of Technology was the first university to post free class materials online for the public, in 2001, and it remains the poster child for the movement. MIT now offers 1,800 courses, which have been accessed by 40 million people, half of whom are self-learners. The movement opens learning to those “walled in by money, race and other issues,” says Taiwanese proponent Lucifer Chu. (The Wall Street Journal)
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