A bit more pressure to break-up Citigroup

A lot of investors think that the house Sandy Weill built has too many rooms. Citigroup (NYSE: C) operates financial divisions for everything from banking in South America to commodities trading in New York. Many shareholder think that some of these businesses would be better off on their own and that Citi could sell them for nice premiums.

Current management at the big financial company obviously thinks keeping Citi together is a good idea. So far, there has been no move to spin out, or auction off, any of the firm's really large divisions.

Management's reluctance to change the face of Citi has not kept the American Federation of State, County and Municipal Employees -- a big U.S. union -- from starting a push to pull the financial company apart. According to the FT, "In a letter sent on Friday to Sir Win Bischoff, Citi chairman, Gerald McEntee, Afscme's president, urged Citi's board to "restore shareholder value that is currently trapped in the sprawling financial supermarket approach.""

The board and management at Citi will ignore the plea, and that is too bad. Even though Wall Street was glad that the company's last set of earnings were not worse, they were certainly bad enough. Some analysts see Citi losing money for several more quarters as it continues to write down investments that have been damaged by the credit crisis.

It is hard to defend keeping assets like Smith Barney when they are likely to fetch a large enough sum to shore up Citi's balance sheet. That logic has escaped the powers that run Weill's creation, which is too bad for anyone who has watched the value of Citi drop by more than 50% in the last year.

Douglas A. McIntyre is an editor at 247wallst.com.