Citigroup Cries Foul
Wachovia's new plan to merge with Wells Fargo is not sitting well with Citigroup, which claims it has an exclusive agreement with the Charlotte bank. Executives at both Wells Fargo and Wachovia are saying little about the possible conflict. During a conference call this morning, investors asked Wachovia CEO Robert Steele if he would address Citigroup's claims that the two banks had a binding agreement. His response to that request was terse, "Nope." Steele did not elaborate, except to say any "controversy on the issue would be addressed in the appropriate way." Citigroup is demanding Wachovia and Wells Fargo stop negotiation immediately and claims it has substantial legal rights regarding Wachovia. When investors asked Wells Fargo CEO John Stumpf about that, he said his deal to merge with Wachovia was "done appropriately,' but seemed hesitant to go much further. "Uh, we're not aware of any, uh, merger agreements that had been consummated at the time and as far as other issues," said Stumpf. The FDIC, which regulates all three banks, has also expressed reservations about the Wachovia-Wells Fargo deal, saying it stands behind the original plan to help Citigroup buy portions of Wachovia.