Citibank is providing Euro transfers and third party account payments with no fees to its customers.
Covering 31 European countries the Citibank initiative will get money into any bank account in Europe within 3 days. The fee free element applies to Citibank current accounts and savings accounts that use the Euro as their currency. Accounts that use a currency other than the Euro will have a charge of 2 percent levied for currency conversion.
A spokesperson from Citibank saw this new initiative as one that would speed up the whole banking process in Europe and make the transfer of money inexpensive and safe. It is expected to be especially popular with customers who have overseas properties and also those who send payments to bank accounts in different European countries.
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Alliance and Leicester shares leapt by almost 50 percent today as news of an agreement regarding the takeover of the bank by Santander was announced.
At a price of 317 pence per share the Alliance and Leicester is being valued at GBP1.33 billion, a price that the Spanish based buyer is happy to pay. The deal is based on trading one Santander share for three Alliance and Leicester ones, making it a very attractive proposition for shareholders and stimulating such fierce trading in them today.
The offer cannot go through without agreement by at least 75 percent of the Alliance and Leicester shareholders, though this is not expected to be an issue. If successful the bid would give Santander, with its other existing UK holdings, a share of the UK savings and unsecured personal loan markets in excess of 8 percent.
Late last week Citibank warned the markets that more big writedowns were expected in quarter 2. They are also looking at more credit losses in the face of what they called unprecedented conditions in the market.
Following the announcement shares on the NYSE fell by over 4 percent, recovering by the end of trading though still down 1 percent. The markets have already seen disappointing results from other major financial players, leading many to feel that the credit crunch is going to hurt companies for some time to come. Citibank made a lot of their money in the sub-prime lending market so have been hit hard by the meltdown in this area.
As well as the mortgage difficulties they experienced Citibank are now seeing the credit crunch hitting their credit card arm too, with business really slowing down as consumers feel the need to rein in their spending.
