Citi May Have a New Mess on Its Hands

Now, the bank could take a billion-dollar hit from bad debt tied to the CDO commercial paper market

One of the most maddening aspects of the current credit-market crisis has been trying to get a handle on the off-balance sheet liabilities at Citigroup (C), which has already disclosed a $1.6 billion hit from exotic debt investments. In this accounting shadowland, nothing is certain. Yet a document analysis by BusinessWeek suggests that Citi may face a fresh billion-dollar exposure because of financial obligations tied to the commercial paper market, a critical source for short-term financing.

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