The chief executive of Citigroup, Vikram Pandit, has informed that the major reason behind the things going wrong at the company is the banking behemoth putting in lot of money in US real estate market.  

In an interview on Tuesday, Pandit said, “What went wrong is that we had tremendous concentration in the sense we put a lot of our money to work against US real estate. So how we got here is, by lending money and putting money to work in the US real estate market in a size that was probably larger than what we ought to have done on a diversification basis.”

Citi would be getting fresh capital to the tune of $40 billion in addition to standing guarantee to the bank's assets worth $306 billion, as part of the deal with the American government. 

According to Pandit, the real and most important question in the rescue plan was related to the confidence in the financial markets. 

He concluded, “And so the real question over the weekend was one, again, of confidence in the financial markets. And for our part, we raised capital with the government, and we actually bought insurance from the government.”