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Judicial Watch • Fdic Docs Citi Minutes 02182011

Fdic Docs Citi Minutes 02182011

Fdic Docs Citi Minutes 02182011

Page 1: Fdic Docs Citi Minutes 02182011

Category:General

Number of Pages:16

Date Created:February 18, 2011

Date Uploaded to the Library:February 20, 2014

Tags:Dugan, Wigand, Reich, Corston, CITIGROUP, banks, Reserve, Chairman, deputy, Division, Department of the Treasury, staff, treasury, federal, board, office, EPA, IRS, ICE, CIA, financial


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56617 

Minutes 
The Meeting the Board Directors the 
Federal Deposit Insurance Corporation Conference Call 
Closed Public Observation 
November 23, 2008 -10:04 P.M. 10:04 p.m. Sunday, November 23, 2008, the Chairman called special meeting the Board Directors the Federal Deposit Insurance Corporation which was held means telephone conference call. 
Sheila Bair, Chairman the Board Directors; Martin Gruenberg, Vice Chairman the Board Directors; Thomas Curry, Director (Appointive); John Dugan, Director 
(Comptroller the Currency) John Reich, Director 
(Director, Office Thrift Supervision); John Bovenzi, Deputy the Chairman and Chief Operating Officer; Steven App, Deputy the Chairman and Chief Financial Officer; Jason Cave, Acting Deputy the Chairman; Jesse Villarreal, Chief Staff; Michael Krimminger, Special Advisor for Policy, Office the Chairman; Barbara Ryan, Deputy the Vice Chairman; Lisa Roy, Deputy the Director 
(Appointive); William Rowe, III, Deputy the Director 
(Comptroller the Currency) Claude Rollin, Deputy the Director (Director, Office Thrift Supervision); John Thomas, Acting General Counsel; Sandra Thompson, Director, Division Supervision and Consumer Protection; Arthur Murton, Director, Division Insurance and Research; Mitchell Glassman, Director, Division Resolutions and Receiverships; Eric Spitler, Director, Office Legislative Affairs; Andrew Gray, Director, Office Public Affairs; and Robert Feldman, Executive Secretary, participated the meeting. 
Also participating the meeting were: Christopher 
Spoth, John Lane, Serena Owens, John Carston, 
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Patricia Colohan, Pete Hirsch, Marc Steckel, and Christine 
Grum, from the Division Supervision and Consumer Protection; 
Richard Aboussie, David Wall, and Mark Flanigan, from 
the Legal Division; Diane Ellis, Miguel Browne, Christopher Newbury, and Matthew Green, from the Division 
Insurance and Research; James Wigand and Herbert Held, 
from the Division Resolutions and Receiverships; Tiffany 
Froman, from the Division Information Technology; and 
Alice Goodman, from the Office Legislative Affairs. 

Julie Williams, First Senior Deputy Comptroller and Chief Counsel; and Douglas Roeder, Senior Deputy Comptroller, Large Bank Supervision, Off ice the Comptroller the Currency, also participated the meeting. 
Chairman Bair presided the meeting; Mr. Feldman acted Secretary the meeting. 
Chairman Bair called the meeting order. Vice Chairman Gruenberg then moved that the Board Directors determine that Corporation business required its consideration the matters which were the subject the meeting less than seven days' notice the public; that earlier notice the meeting was practicable; that the public interest did not require consideration the matters which were the subject the meeting meeting open public observation; and that the matters could considered meeting closed public observation authority subsections (c) (4), (c) (B), 
(c) (9) (A) (ii), and (c) (9) (B) the "Government the Sunshine Act" U.S.C. 552b( (c) (4), (c) (8), (9) (A) (ii), and (c) (9) (B)). Chairman Bair seconded the motion and, with Director Reich, Director Curry, and Director Dugan concurring, the motion was carried. 
James Wigand, Deputy Director, Franchise and Asset Marketing Branch, Division Resolutions and Receiverships ("DRR"), presented the Board staff's recommendation that the Board find that the failure Citigroup Inc. ("Citigroup") and its insured affiliate banks and thrifts would have serious adverse effects domestic and international economic conditions and financial stability and that Citigroup's failure would seriously and negatively affect already disrupted credit markets, including short-term interbank lending, counterparty relationships Qualified Financial Contract markets, and bank senior and subordinated debt markets, and would further disrupt the related markets derivative products and other markets. Therefore, stated Mr. Wigand, staff was further recommending that the Board 

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make systemic risk determination and authorize staff take necessary steps implement the provision Corporation assistance Citigroup the manner would outline the Board. Mr. Wigand informed the Board that, based preliminary information, staff estimates loss the Deposit Insurance Fund result the recommended assistance. 
Mr. Wigand continued, stating that, order prevent the foregoing systemic risks, staff was recommending that the Board authorize the Corporation enter into transaction provide for shared loss coverage designated pool assets approximately $306 billion size, along with the U.S. Department the Treasury's ("Treasury") Troubled Asset Relief Program 
("TARP"), with the Corporation's potential loss protected the issuance preferred stock Citigroup. added that the Corporation and the TARP will provide guarantees certain residential assets for years and certain other assets for period years. The Corporation, said, will exposed loss only after Citigroup absorbs the first $37 billion losses and the TARP absorbs the next billion losses. Mr. Wigand stated that the Corporation's loss share will capped $10 billion and will receive compensation the form billion preferred stock. addition, said, the Board Governors the Federal Reserve System ("Federal Reserve") will provide certain financing secured, part, assets portfolio consumer and commercial loans designated the Corporation, Treasury, and the Federal Reserve (collectively, the "Agencies") and Citigroup. 
Mr. Wigand next stated that Citigroup and the Agencies will share losses, with Citigroup having percent loss share all losses excess the $37 billion. explained that the TARP will take the second loss position billion and the Corporation will take the third loss position $10 billion, with the loss share the TARP and the Corporation capped explained above and the Federal Reserve taking remaining losses. Mr. Wigand then informed the Board that Citigroup will manage the assets, with instructions provided the Agencies. Among the instructions, specified, will those requiring use loan modification procedures comparable those introduced the Corporation August 20, 2008, IndyMac Federal Bank, FSB, Pasadena, California, which the Corporation conservator, unless otherwise agreed. addition, Mr. Wigand stated that Citigroup will subject specific limitations executive compensation and dividends during the loss share period. 

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Mr. Wigand then informed the Board that the Corporation, the Office the Comptroller the Currency ("OCC"), and the Office Thrift Supervision ("OTS") have determined that the insured affiliate banks and thrifts Citigroup meet the requirements under section 13(c) (8) the Federal Deposit Insurance Act ("FD! Act") for receiving direct financial assistance before the appointment receiver, and that assistance will increase existing capital levels and improve liquidity. exchange for the guarantees Mr. Wigand had described, explained that Citigroup has agreed (1) seek the prior approval the Agencies before paying dividends for three years; (2) develop executive compensation program that rewards long-term performance and profitability approved the Agencies; and 
(3) implement loan modification procedures conforming with the Corporation's model used IndyMac Federal Bank, FSB, for mortgages the asset pool, unless otherwise agreed. Additionally, Mr. Wigand had previously stated, the Corporation and the TARP will receive preferred stock reasonable compensation for the guarantees provided. 
Mr. Wigand then requested that John Corston, Associate Director, Large Institutions and Analysis Branch, Complex Financial Institutions, Division Supervision and Consumer Protection, provide the supervisory history and condition Citigroup and its insured bank and thrift affiliates. Mr. Corston explained that Citibank, National Association, Las Vegas, Nevada ("CBNA") nationally chartered bank founded 1812 that the lead bank within Citigroup, financial holding company regulated the Federal Reserve; and that CBNA the third largest bank the nation and the predominant legal entity representing percent consolidated holding company assets. then explained that the remaining insured legal entities Citigroup consist additional two national banks, one federal savings bank, and one state non-member bank, respectively, follows: Citibank (South Dakota), N.A., Sioux Falls, South Dakota; Department Stores National Bank, Sioux Falls, South, Dakota; Citicorp Trust Bank, fsb, Wilmington, Delaware; and Citibank (Banamex USA), Century City, California. then continued, stating that Citigroup the largest consumer finance lender the world, third largest mortgage servicer, and the fourth largest student lender. also, said, the world's largest credit card lender and the third largest the United States well one the world's largest private banking and private wealth management businesses. 

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Mr. Corston added that Citigroup has three principal nonbank subsidiaries: Citigroup Global Markets Holdings, Inc., broker -dealer; Citigroup Funding, Inc., the primary funding vehicle Citigroup; and Associates First Capital Corporation, the parent company CitiFinancial, which provides consumer finance. addition, said, there one foreign banking subsidiary-Grupo Financiero Banamex CV, Mexican banking organization. 
Mr. Corston then stated that CBNA engages extensive foreign activities and has operations over 100 countries, operating approximately 1,000 retail branches states, the District Columbia, and Guam. said that CBNA reported foreign assets $612 billion and foreign deposits $554 billion held either direct foreign branches CBNA other foreign entities that are mostly owned the CBNA's Edge Act investment subsidiary, Citibank Overseas Investment Corp. 
("COIC"). core, Mr. Corston explained, has over foreign banks that are headquartered and chartered countries around the world. then informed the Board that the risk profile CBNA increasing rapidly due the market's lack confidence the company and substantially weakened liquidity position. particular, Mr. Corston said that liquidity has reached crisis proportions, such that the CBNA projected unable meet its obligations. Most recently, said this was exemplified Friday, November 21, 2008, when the United Kingdom's Financial Services Agency imposed $6.4 billion cash lockup requirement protect the interests the United Kingdom broker-dealer. 

Mr. Corston then reported that, Friday, November 21, 2008, market acceptance CBNA's liabilities diminished, the company's stock plunged 16-year low; credit default swap spreads widened basis points 512.5 basis points; and counterparties advised that they would require greater collateralization any transactions with CBNA. 
Mr. Corston next informed the Board that, without substantial government intervention that results positive market perception the morning Monday, November 24, 2008, OCC and Citigroup project that CBNA will unable pay obligations meet expected deposit outflows the following week. Citigroup's contractual cash flow projections, said, 
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show that total 7.2 percent deposit run off will result cash surplus. 

Mr. Corston continued his presentation, stating that current requests Citigroup the Federal Reserve expand the Commercial Paper Funding Facility ("CPFF") (created the Federal Reserve October 2008, help provide liquidity term funding markets) and expand collateral and entities eligible for posting the Primary Dealer Credit Facility 
("PDCF") and the Term Securities Lending Facility ("TSLF") would provide short-term funding relief. However, according Mr. Carston, the additional funding provided CPFF, PDCF, and TSLF would not sufficient withstand extensive deposit runoff. 
Mr. Corston then turned the matter systemic risk, explaining that appears likely that any transaction implemented the Corporation under least-cost framework would have significant adverse effects economic conditions and the financial markets based Citigroup's size and the markets which operates. Given Citigroup's significant international presence, said, the effects money market liquidity could expected global basis. addition, stated that term funding markets remain under considerable stress. Mr. Corston said that these pressures have increased over the past week with loss investor confidence financial institutions' performance, evidenced significant drop bank equity values and another round increases banks' credit default swap spreads. Citigroup has been particularly vulnerable, Mr. Corston said, with its exposure credit and market losses coupled with its dependence international operations for funding. observed that the Corporation prohibited from taking action that could expose the Deposit Insurance 
Fund manner that could benefit debt equity holders company without invocation the systemic risk exception available under the FD! Act. 
Mr. Corston then emphasized that not providing open bank assistance Citigroup would likely have major systemic effects. said that both financial stability and overall economic conditions would adversely affected for the reasons had already discussed, and that staff believes the consequences could extend the broader economy. Recent disruptions global money and credit markets since September and other developments, said, point clear nexus between financial market turmoil and impaired economic performance that could expected worsen further Citigroup and its insured 

56623 

subsidiaries should allowed fail. Mr. Corston said that such event would significantly undermine business and household confidence. addition, Mr. Corston stated, with the liquidity banking organizations further reduced and their funding costs increased, banking organizations would become even less willing lend businesses and households, thereby contributing weaker economic performance, further damage financial markets, and other material negative effects. creating the systemic risk exception, Mr. Corston stated that Congress clearly envisioned that circumstances could arise which the exception should used. concluded his presentation stating that, view the current intense financial strains, well the likely consequences the general economy and financial system failure provide open bank assistance the third-largest commercial bank the United States, staff believed that circumstances such Congress envisioned are clearly present and that invocation the systemic risk exception justified. 
John Thomas, Acting General Counsel, then clarified that, despite Mr. Corston's reference least-cost framework resolution Citigroup having significant adverse effects economic conditions and the financial markets, the actual problem not that staff's recommendation least-cost resolution, inasmuch the expected cost the Corporation zero. Rather, Mr. Thomas said, the problem, i.e., the need for the Board make systemic risk determination implement staff's recommended resolution exists because amounts the provision open bank assistance. Chairman Bair acknowledged Mr. Thomas's point and thanked him for the clarification. 
Vice Chairman Gruenberg then stated his support for the case and expressed his view that the finding systemic risk clear and justified. noted the exceptional cooperation that had occurred among the Federal bank regulatory agencies and Treasury what necessary maintain financial stability extraordinary set market conditions. added that conditions imposed Citigroup relating dividends and executive compensation, well the loan modification protocol, are essential components the case. 
Director Curry agreed with Vice Chairman Gruenberg's comments and added that staff has amply made the case that the systemic risk determination standard has been met. indicated further that hoped that the open bank assistance contemplated 

56624 the recommendation sufficient and that was prepared vote favor the recommendation. 
Director Dugan stated that strongly supported the recommendation, agreeing, Vice Chairman Gruenberg and Director Curry had said, that the facts presented amply justified the recommendation. added that the proposal was not simply about Citigroup and its insured bank and thrift affiliates but about confidence other banks well. result, said, was absolutely critical that the Board act decisively take measures address the circumstances described. Director Dugan, too, hoped that the assistance granted was adequate accomplish the Agencies' goals and said, that with the combination the Agencies' resources, thought would be. 
Chairman Bair asked Director Dugan whether OCC had supervisory strategy for helping get CBNA and the two other national bank affiliates Citigroup (collectively, "Citigroup's national banks") under control again. Director Dugan responded that the situation was about confidence opposed capital those institutions their reserve levels. indicated that OCC will closely monitoring the situation and dealing with issues related supervision, but that the issue hand was that potential world-wide bank run needing brought under control. Chairman Bair agreed regarding the need re-instill confidence about banks, but she added that the Corporation will look forward working with OCC regarding the appropriate supervisory strategy for Citigroup's national banks. She expressed her understanding that all the Federal depository institution regulators are committed making sure that Citigroup pursues selling itself certain parts itself, but noted that this not the first time that Citigroup has become challenged. 
Chairman Bair then set out her understanding that Citigroup has significant off-balance-sheet exposure that could having come book the end 2009, which could further complicate the situation. She noted that the Corporation has already provided $77 billion guarantees Citigroup's unsecured senior debt under the debt guarantee program component the Temporary Liquidity Guarantee Program initiated the Corporation October 13, 2008, mitigate the serious adverse effects economic conditions financial stability that would otherwise create systemic risk the credit markets. Chairman Bair further noted that the Corporation could ultimately wind guaranteeing even more 
56625 

Citigroup's debt unsecured senior debt Citigroup were apply for exception its debt guarantee limit. She observed how deeply those guarantees place the U.S. government 
"on the hook." addition, approving staff's recommendation from the instant proposal, which she said something the Board's need do, would involve the Corporation's providing additional reinsurance the losses Citigroup's loan portfolio. Chairman Bair cautioned, however, that the Corporation's and the TARP's financial assistance Citigroup not sufficient right Citigroup has significant problems requiring very aggressive supervisory strategy. Without the latter, Chairman Bair stated, the Corporation will find itself needing infuse additional assistance into Citigroup. 
Director Reich then indicated his support for staff's recommendation and recognized that systemic risk was involved. response question from Director Reich Citigroup's current liquidity situation, Douglas Roeder, Senior Deputy Comptroller, Large Bank Supervision, OCC, stated that the liquidity component CBNA's CAMELS rating was not less than "3", given the support CBNA was about receive from the transaction the table this meeting. Chairman Bair then asked how the latter could when the OCC was the verge having close the Citigroup's national banks because CBNA was not going able meet its liquidity needs the morning Monday, November 24, 2008. She added that CBNA has $500 billion foreign deposits that cannot guaranteed anyone and repeated that she could not understand how the OCC could rate CBNA's high "3" given the latter circumstances. Director Dugan responded that the "3" rating for liquidity essentially anticipates what the rating will once the transaction before the Board approved. Chairman Bair responded, turn, that the Corporation does not use that just-described approach criterion its liquidity ratings and that certainly not the criterion used for the liquidity ratings other banks. She indicated that not good approach say that institution can receive "3" rating for liquidity could only demonstrated that government assistance would enable adequate liquidity. Then, Director Dugan said that thought the ability contemplate government assistance enabling institution achieve adequate liquidity had been the standard. stated that the fact that CBNA has already received certain amount government assistance and the fact that the instant proposal would provide more are factors evaluating its current liquidity rating. Further, said, OCC will adjust and evaluate 

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CBNA's liquidity after examines what happens once the proposal actually consummated. 

Chairman Bair said that the just-completed discussion CBNA's liquidity rating raises again her question what OCC's supervisory strategy for CBNA. She added that she was the view that the current proposal would not resolve Citigroup's problems and that, unless OCC found way stabilize the situation CBNA, the Corporation would find itself again being asked infuse additional assistance. Chairman Bair stated that she wanted the latter statement the record the Board's consideration this matter, and she said that the Corporation desires work constructively with the OCC about realistically recognizing Citigroup's underlying problems being deeper than merely being reflective general market conditions. She emphasized that Citigroup has certain problems very specific itself and that all the depository institution regulators need work together means fixing them. 
Director Dugan stated that OCC would continue work very hard address Citigroup's problems without committing particular strategy this point. added that the OCC will looking numerous options and will keep the Board informed those options. 
Staff then responded questions from Director Reich regarding the "ring-fencing"-specific identification assets asset pool-of the previously referenced $306 billion asset pool that was the subject the loss share coverage and regarding the Corporation's standard loss sharing protocol. Also response question from Director Reich, Mr. Thomas indicated that the dividend restrictions under which Citigroup must seek the Agencies' consent pay excess $.01 per share per quarter for three years are contractual nature versus the separate supervisory basis the OCC has under which it, too, can restrict the payment dividends with respect Citigroup's national banks. 
Director Reich then asked any changes management are expected required the result the proposal. Chairman Bair, terming that good question, asked Director Dugan respond. Director Dugan responded that the agreement requires changes management. Chairman Bair then asked whether occ was evaluating the quality management component its supervisory strategy. Director Dugan responded that OCC always evaluating the quality management, and added that OCC simply cannot dismiss management unless there are available other people 

56627 

who are willing and capable take over. Director Reich then stated his sympathy for the situation Director Dugan, Comptroller the Currency, facing, stating that there doubt his mind that this systemic risk situation. Director Reich then suggested that, hindsight, there may have been some systemic situations prior the current one that were not classified such the failure IndyMac Bank, F.S.B., Pasadena, California, July 11, 2008, which pointed the next weakest institution, Washington Mutual Bank, Seattle, Washington, which failed September 25, 2008, which, turn, pointed the insured bank and thrift affiliates Wachovia Corporation, Charlotte, North Carolina, which generated the Corporation's first systemic risk finding September 29, 2008, and which finally pointed the Citigroup situation. Director Reich wondered which notable institution would next. expressed his hope that the Federal bank regulators and Treasury would look future such situations balanced manner and avoid "selective creativity" determining what constitutes systemic risk and what does not and what possible for the government and what not. stated that there has been high degree pressure exerted certain situations and not others, making him concerned about parity. 
Vice Chairman Gruenberg then thanked the Corporation's staff, many whom had been work the entire weekend connection with this matter well the staff other agencies for their extraordinary efforts. Chairman Bair concurred with Vice Chairman Gruenberg's statement and noted that many staff still had long night before them working executing the necessary agreements and making announcements the media. 
Then, accordance with the recommendation staff and motion Vice Chairman Gruenberg, seconded Director Curry, concurred Director Dugan, Director Reich, and Chairman Bair, the Board adopted the following resolution: 
(1) 	
finding that the instability the insured bank and thrift affiliates Citigroup ("Banks") would have serious adverse effects economic conditions financial stability and would create systemic risk the credit markets; 

(2) 	
finding that severe financial conditions exist which threaten the stability significant number insured depository institutions insured depository institutions possessing significant 

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financial resources and the Banks are insured depository institutions under such threat instability and that the Board takes this action order mitigate the serious adverse effects, which will lessen the risk the insurance fund, and systemic risks, posed the Banks, and that the proposal will the least costly all available methods; 
(3) 	
finding that the proposal which involves the provision assistance under section 13(c) (2) the FDI Act, U.S.C.  1823(C) (2), the form guarantees against loss to, contributions to, the Banks, will mitigate the serious adverse effects economic conditions financial instability that would caused the Banks' continued seriously weakened condition; 

(4) 	
finding that the conditions for receiving direct financial assistance before the appointment receiver under section (c) (8) (A) (i) and (ii) the FDI Act have been satisfied; 

(5) 	
authorizing the Chairman the Board, her designee, provide the written recommendation the Secretary the Treasury specified under section 13(C) (4) (G) (i) the FDI Act, U.S.C.  and 

(6) 	
authorizing the Director, Division Resolutions and 
Receiverships, his designee, and all other 
Corporation staff take all appropriate action 
implement the provision assistance authorized 
hereunder, including but not limited to: credit 
support the form loan guarantees, and loss 
sharing, and take any other action necessary and 
appropriate connection with this matter: 

WHEREAS, staff has presented information the Board Directors ("Board") the Federal Deposit Insurance Corporation ("FDIC" "Corporation") indicating that the recent unprecedented disruption credit markets and the resultant effects the abilities banks fund themselves and intermediate credit place the United States danger suffering adverse economic conditions and financial instability; and 
November 23, 2008 (Closed) 

56629 

WHEREAS, these conditions threaten the stability significant number insured depository institutions, thereby increasing the potential for losses the Deposit Insurance Fund the resolutions such insured depository institutions; and 
WHEREAS, staff has advised the Board the FDIC that Citibank, National Association, Las Vegas, Nevada, Citibank (South Dakota), N.A., Sioux Falls, South Dakota, Citicorp Trust Bank, fsb, Wilmington, Delaware, Citibank (Banamex USA), Century City, California, Department Stores National Bank, Sioux Falls, South Dakota ("Banks"), and their affiliates are seriously weakened condition; and 
WHEREAS, staff has advised that severe financial conditions exist which threaten the stability the Banks which are insured depository institutions possessing significant financial resources; and 
WHEREAS, proposal for the stabilization the Banks and their affiliates without the appointment the FDIC receiver has been developed consultation with the Board Governors the Federal Reserve System ("Federal Reserve Board") and the Secretary the Treasury (collectively the "Agencies"), which involves the Agencies provision guarantees against loss certain residential assets for years and certain other assets for period years; and 
WHEREAS, Citigroup Inc. ("Citigroup") will take first loss position equal $37 billion; and 
WHEREAS, for losses above $37 billion, there loss sharing agreement where losses are shared percent Citigroup and percent the Agencies with Treasury taking second loss position billion, the Corporation taking the third loss position $10 billion, and the Federal Reserve Board having agreed take the remaining risk based nonrecourse lending the pool assets 
("Proposal"); and 
November 23, 2008 (Closed) 
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WHEREAS, the Corporation receiving billion preferred stock compensation for its taking the $10 billion third loss position; and 
WHEREAS, the Proposal subject prudential regulatory oversight and executive compensation restrictions, with the guarantees having limited duration, and staff believes that the Proposal will avoid mitigate the serious adverse effects economic conditions financial stability the most cost effective method; and 
WHEREAS, the FDIC, the Office the Comptroller the Currency, and the Office Thrift Supervision have determined that the Banks meet the conditions under section 13(c) (8) (A) (i) and (ii) the Federal Deposit Insurance Act ("FDI Act") for receiving direct financial assistance before the appointment receiver; and 
WHEREAS, staff has recommended that the FDIC Board make systemic risk recommendation supporting action the FDIC; and 
WHEREAS, the Corporation has been advised that the Federal Reserve Board expected make similar recommendation and that the Secretary the Treasury, after consultation with the President, expected make the systemic risk determination this situation. 
NOW, THEREFORE, RESOLVED, that the Board finds that the instability the Banks would have serious adverse effects economic conditions financial stability and would create systemic risk the credit markets. FURTHER RESOLVED, that severe financial conditions exist which threaten the stability significant number insured depository institutions insured depository institutions possessing significant financial resources and the Banks are insured depository institutions under such threat instability and that the Board takes this action order mitigate the serious adverse effects, which will lessen the risk the insurance fund, and systemic risks, posed the Banks, and that the 

56631 

proposal will the least costly all available methods. FURTHER RESOLVED, that the Board finds that the Proposal which involves the provision assistance under section 13(c) (2) the FDI Act, 
U.S.C.  1823(C) (2), the form guarantees against loss to, contributions to, the Banks, will mitigate the serious adverse effects economic conditions financial instability that would caused the Banks' continued seriously weakened condition. FURTHER RESOLVED, that the Board finds that the conditions for receiving direct financial assistance before the appointment receiver under section 13(c) (8) (A) (i} and (ii) the FDI Act have been satisfied. FURTHER RESOLVED, that the Board hereby authorizes the Chairman the Board, her designee, provide the written recommendation the Secretary the Treasury specified under section 13(C) (4) (G) (i) the FDI Act, U.S.C.  1823 (C) (4) (G) (i). FURTHER RESOLVED, that the Board hereby authorizes the Director, Division Resolutions and Receiverships, his designee, and all other FDIC staff take all appropriate action implement the provision assistance authorized hereunder, including but not limited to: credit support the form loan guarantees, and loss sharing, and take any other action necessary and appropriate connection with this matter. 
[EXECUTIVE SECRETARY'S NOTE: Sunday, November 23, 2008, the United States government entered into agreement with Citigroup Inc., provide package guarantees, liquidity access, and capital, whereby, part the agreement, the Department the Treasury and the Corporation will provide protection against the possibility unusually large losses asset pool approximately $306 billion loans and securities backed residential and commercial real estate and other such assets, which will remain Citigroup's balance sheet. fee for that arrangement, Citigroup will issue preferred shares the Treasury and the Corporation. addition, Citigroup will comply with enhanced executive 

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compensation restrictions and implement the Corporation's mortgage modification program.] 
Documents and materials relevant the Board's consideration the foregoing are marked exhibit for identification, are filed the jacket this meeting, and, reference, are made part these minutes and the permanent files the Board Directors. 
There being further business, the meeting was adjourned. 

Executive Secretary