Did Citi (C) Exit The Fed Bailout Program Too Soon?

The last several days have seen financial bellwethers Citi (NYSE: C), JPMorgan (NYSE: JPM) and Wells Fargo (NYSE: WFC) exit the Federal bailout program. However, the struggle that Citi faced while offloading shares in the market seems to have raised questions on whether the venerable banking giant rushed too soon into exiting the program. Citi managed to sell its shares at a $3.15 per share.

This was much lower than what the government paid for it when it bailed out Citi. This low realized price also forced the government to postpone plans to offload its own shares in the market. The Wall Street Journal reports that Citi officials privately blame the government for the fiasco, stating that its issue should not have run parallel with Wells Fargo, the argument being that the parallel issues dampened the demand for Citi shares.

The government too is a quagmire as it is forced to be a market participant trying to maximize return on taxpayer money used last year to bail out banks perceived to be ‘too big to fail’.