Bloomberg News
NEW YORK Citigroup Inc. could be on the hook for up to $70 million of a $700 million credit line it arranged in October for Arthur Andersen LLP.
As the arranger of the credit line, Citi would typically keep about 10% of the loan and syndicate the rest to other banks. Barclays Bank PLC and Bank of America Corp. were also lenders.
The accounting firm is fighting criminal charges and lawsuits stemming from the bankruptcy of Enron Corp., a former client. Andersen may not survive a rash of customer and employee defections, lawsuits, and a criminal charge of obstructing a probe into Enrons bankruptcy.
Dan Noonan, a spokesman for Citigroup, declined to discuss the credit line, as did Bank of America Corp. spokesman Jeff Hershberger and Linda Wynns of Barclays. Andersen spokesman Patrick Dorton did not return calls.
Citis exposure through the credit line would be in addition to the $228 million it wrote off in the fourth quarter because of loans to Enron.
