Citigroup says it will sell about $3 billion of its common stock in a public offering.
The New York-based bank says the offering will include an over-allotment option to buy more shares.
That's not the big news. The big news is that a dilutive transaction to raise capital did not cause the stock to rise 30%. In fact it is down 3% after hours. Imagine that? Something damaging to shareholders doesn't excite investors to buy buy buy. Don't worry, it will be up 5% tomorrow. lol
Okay caustic comments aside I think it shows that at least Citigroup management think this latest rally in financials may be overdone. Citigroup is up over 30% from its low. What a great time to raise an additional $3 billion in financing to strengthen your balance sheet that will probably need more capital after your stock has rebounded on the hope that the worst is over worth.