SkyBridge Capital founder Anthony Scaramucci is pushing back against a report that Citigroup’s private bank is ending its relationship with his firm.
The Wall Street Journal reported on Saturday that Citi made the move after SkyBridge’s flagship fund suffered a 22.5 percent loss in March as credit and mortgage-backed securities markets seized up,
“When they say cut ties, The Wall Street Journal actually got that wrong,” Scaramucci told FOX Business.
Citigroup, whose clients have about $150 million invested in New York-based SkyBridge’s flagship fund, “issued a sell,” he said. Scaramucci predicts $125 million, or 83 percent, of that cash will remain with SkyBridge, which has a “very good relationship” with the investors involved. They tend to agree that "our fund is way underpriced,” he added.
Citigroup declined to comment.
Scaramucci said SkyBridge, which had $4.8 billion in assets at the end of February, has been investing in structured credit for 15 years, and that the last time the firm faced a similar situation was in the fall of 2008, during the depths of the financial crisis. That time, the firm rebounded with returns of 21 percent and 17 percent, respectively.
Scaramucci said the current losses are “unrealized,” meaning they could be pared or even erased before SkyBridge sells the assets. At present, it's holding the portfolio.
Some of the bigger shops like Citigroup sometimes “issue sells at the worst possible time,” Scaramucci said, adding that he’s hoping Citi’s decision is a “contrarian indicator."
Scaramucci, who previously outlined his position on CNBC, founded SkyBridge in 2005 and reached a deal to sell the firm to Chinese conglomerate HNA Group in January 2017 before his 10-day stint as director of communications for President Trump.
He rejoined the company in April 2018, after the sale to HNA fell through.