Citi Needs $10B

Citibank is taking the Federal Reserve’s stress test—and it’s stressing. It seems the bank will have to raise $10 billion in new capital as a result of the tests. In a best-case scenario—if it can convince the government of its health—the banking giant may only need to scare up $500 million. However much it is told to raise, the bank will likely do so by broadening the securities held by private investors. On Friday, Citigroup sold its Japanese brokerage business, which boosts its tangible common equity to $2.5 billion. And now, of course, Citi officials are trying to squeeze the results of that sale into the government’s evaluations before it’s too late.