At
CFR,
Citigroupers Rhodes & Zedillo Won't Answer on Citi's Greek Debt Spin
By
Matthew
Russell Lee
NEW
YORK,
May 3 -- Citibank's senior adviser William Rhodes and Citigroup
board member Ernesto Zedillo spoke Tuesday as two of three panelists
on sovereign debt, with an emphasis on Greece, at the Council on
Foreign Relations in New York. Both predicted and promoted debt
restructuring.
But
when Inner City
Press asked them to comment on the Greek
government's charges against
Citigroup trader Paul Moss, who spread buzz about restructuring just
before Easter, and to distinguish their presentations from his,
Zedillo cut in.
“The gentleman
is retired,” he said, gesturing at Rhodes. “I am a board member
of Citigroup and I never comment” on the company, Zedillo said, to
some audience laughter.
To
Paul Moss and
many in Greece, of course, it is not so funny.
Moderator
Roger
Altman had introduced Rhodes in terms of his 53 years at Citigroup
and Zedillo as a member of the board of director of Citigroup and
Alcoa. The CFR program listed Rhodes as, currently, a Citigroup
“senior adviser.”
If
after the
charges against Citigroup's Paul Moss for spinning Greek debt
restructuring these two are going to refuse to answer questions, some
wonder, should they be speaking in this way about... Greek debt
restructuring?
Their
co-panelist
Adam Lerrick, helpfully identified as the chairman of Sovereign Debt
Solutions Limited offered as solution that weak banks disappear,
either acquired by larger ones or “liquidated” -- he called the
difference “a matter of indifference.” He accused the
International Monetary Fund of “fudging.”
As
Inner City Press
reported
from last month's Spring Meetings of the IMF and World Bank,
the IMF is pitching bank mergers, specifically praising the
acquisition of Fortis of Belgium by BNP Paribas.
So what
of Greece's Hellenic
Postbank and ATEbank? Watch this site.
Footnote:
Rhodes
repeatedly told the audience, you know what I mean, you worked
in this during previous debt restructurings. One questioner
identified himself as a “creditors' advocate.” We note that
Citigroup in Indonesia is charged with a role in the death of a
borrower while being interrogated about his Citi credit card debt.
Some advocacy, that...
* * *
IMF
Promotes
Bank
Mergers,
Says Bigger is Better, Politics &
Portugal Dodged
By
Matthew
Russell
Lee
WASHINGTON
DC,
April
15
-- The International
Monetary
Fund is unabashedly
promoting the takeover of small banks by large ones, claiming that
its own work in “Emerging Europe” since the financial meltdown
shows that communities are better served by large banks, even if
based far away or in other countries.
IMF
European
Department Director Antonio Borges told reporters on Friday that
Belgium was smart to have pushed Fortis to being acquired by BNP
Paribas. He urged more such mergers.
Inner
City
Press
asked
Borges if the IMF proposed any safeguards at all, given that
concerns exist that when a local bank is acquired by one based far
away, there will be less reinvestment and accountability.
Borges,
while
calling
this
an “interesting question,” bragged that the IMF
organized a coordinated effort to get large banks to treat
communities, particularly in Emerging Europe, fairly, and that this
had worked. See IMF
transcript, below.
Borges, invisible hand and safeguards on mergers not shown
Inner
City
Press
began
to ask about attempts to encourage or require reinvestment, for
example in the UK -- but moderator Simonetta Nardin said there was no
time for follow up questions.
Meanwhile,
Borges
took
but
refused to answer two questions about Portugal, citing an
IMF policy against officials working on their own countries, and also
claiming that the IMF does not get involved in politics. What --
encouraging bank mergers is not political? Watch this site.
From the IMF's
transcript:
Inner
City
Press:
you seem to be saying that bank mergers—small banks
being bought by big ones sort of unqualifiedly may be a good thing.
In some countries people think that local banks are more accountable,
that if you move the assets to a faraway headquarters that there's
less responsive. What do you say to that critique and is that
something that the IMF takes any account of?
MR.
BORGES:
you
ask a very interesting question, because this is a
problem we were faced with over the last few years. In many of the
countries of emerging Europe, you find banks that actually are owned
by other banks elsewhere and there were concerns that, as there might
be problems in the domestic countries of those banks that assets
would be pulled out from emerging Europe and they might suffer. And
the Fund, the IMF, invested quite a bit of effort to organize a
coordinated effort on the part of all these banks to behave in the
best possible interests of those economies, and I must say this was
quite successful, because as a result, these countries are now
recovering very well and their banks are operating well. So, if
anything, the experience of emerging Europe demonstrates that having
large, solid banks operate in your country may be an important source
of stability if things are properly managed.
, 
