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Losing faith in Citi, Merrill and polling data The decision by Citi and Merrill Lynch’s bosses to accept handouts from foreign governments has not gone down well with US citizens, according to report by market research group Strategy One: Jump to day
Over half of the 1,000 people polled…said they “trusted Citigroup less” after its recent decision to tap Middle Eastern and Asian sovereign funds to ease its financial constraints.
Tue 22nd Jan
In Merrill’s case, 45 per cent of the respondents said their trust in the bank had fallen since hearing of investments from foreign state funds, according to the research to be published on Tuesday. Alphaville by email
FT Alphaville finds this all bit confusing. Apparently, Citi and Merrill have suffered some kind of PR disaster as a result of their begging for SWF money…or have they?Looking at the data, the question posed by Strategy One’s poll is whether respondents are less likely to trust Citicorp after hearing about the foreign investments - and 51 per cent of those polled said yes. But surely we should be more worried about the 4 per cent who said they trusted the banks more now, post handouts and writedowns? Moreover, when asked, less than 25 per cent of respondents said they’d ever clocked that a chunk of the money was coming from the Middle East - (cf those Arabs from Apple Dubai). In fact, the source of the investments was listed as the “least registered” bit of information, much lower down the banks’ subprime difficulties and writedowns. Strategy One’s president Laurence Evans has identified a “xenophobic element” in the polls results, saying “people don’t know how much influence sovereign wealth funds will have.” Maybe we should look at it another way. It’s not that we at FT Alphaville don’t believe in xenophobia - we’ve commented before on those dubious foreigners at the ratings agencies. No - it’s more that we believe in not readily trusting banks that have lost a lot of money, ousted the chief execs and are generally wandering the streets with hands outstretched and little cardboard signs promising not to spend your hard earned cash on CDOs…. This entry was posted by Alida Smith on Tuesday, January 22nd, 2008 at 20:46 and is filed under Capital markets. Tagged with citi, merrill lynch. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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http://ftalphaville.ft.com/blog/2008/01/22/10360/losing-faith-in-citi-merrill-and-polling-data/ (1 of 2)1/24/2008 11:31:45 AM
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http://ftalphaville.ft.com/blog/2008/01/22/10360/losing-faith-in-citi-merrill-and-polling-data/ (2 of 2)1/24/2008 11:31:45 AM