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Reuters: Citi Unit Lost $20 Million in Facebook IPO

Friday, 25 May 2012 03:55 PM

 

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Citigroup Inc's Automated Trading Desk had trading losses of about $20 million from Facebook Inc's botched initial public offering on Nasdaq OMX Group Inc's U.S. exchange, a source with knowledge of the situation said on Friday.

The unit's losses were in addition to claims by market makers Knight Capital Group Inc and Citadel Securities, which each had losses of $30 million to $35 million.

UBS AG, the other large market maker involved in the IPO of the social networking company on May 18, has not disclosed any losses.

Nasdaq asked firms to detail estimates of losses by Monday night. After that, the Financial Industry Regulatory Authority will evaluate the filings and put out a report on the matter in about four weeks, two sources said.

A technical glitch delayed Facebook's market debut by 30 minutes and many client orders were delayed, giving some investors and traders significant losses as the stock price dropped.

The exchange operator is facing lawsuits from investors and threats of legal action from brokers.

© 2013 Thomson/Reuters. All rights reserved.

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