Wells Fargo Wins Wachovia

Citigroup has pulled out of talks for Wachovia, paving the way for Wells Fargo to become the third largest bank in the country.

Banking giant Citigroup said Thursday it had ended talks with Wells Fargo about reaching an agreement to acquire parts of the struggling bank Wachovia and is no longer looking to buy any of Wachovia's assets.

Citigroup also said that it would not seek to block the merger agreement between Wells Fargo and Wachovia but that it would still seek damages from the two banks for breach of contract.

Wells Fargo has submitted an application to the Federal Reserve Board seeking expedited approval of its merger with Wachovia, the company in a joint statement with Wachovia.

The Wells Fargo deal is much better for Wachovia than the one Citigroup was offering.

I think long-term Citigroup will be glad it didn't pull the trigger on this deal. Let Wells deal with it. Then again, who knows if either one will be around in a year?