Paper 2 Essay Example | Topics and Well Written Essays - 500 words

Paper 2 - Essay Example The government also guaranteed losses to the tune of $300 billion due to troubled assets of the Citibank. Subsequently, the restructuring exercise done by the management under the leadership of the newly joined CEO Vikram Pandit did turn the table. The bank showed profit in the last four figures is a testimony to the successful strategic actions taken by the management. Pandit in an address to the company employees listed the following objectives to spearhead the bank to old glories. 1. The focus is now on emerging markets. Citibank is well placed to tap the opportunities due to wide network of its offices throughout the world. Bank aims at remaining number one in emerging markets. 4. Bank would take great strides in the coming years by meeting financial needs of their clients from infrastructure to alternative energy to many development projects in the fastest growing economies in the world. The recent performance of Bank of America does not show much of a promise as BOA made losses to the tune of $8.8 billion in the second quarter this year. The biggest issue with BOA is $408 billion of mortgages that bank is holding in home equity. Banks future is linked with the recovery of housing market and that is not likely to show any sign of recovery because of the high unemployment rate prevailing in the US market. Depressed economy in US and high unemployment rate will keep housing market in a subdued state for quite a long time. For this reason, BOA remains a highly risky stock with not much of a hope of any dramatic improvement in coming years. Moreover, BOA is not active enough in the emerging markets and developing economies with a possibility of getting benefited like Citibank. From the above analysis it seems that though both the banks had worst period during the subprime crisis, Citibank is displaying required dynamism to come out of the crisis through