Sovereign Wealth Funds Invest in Merrill, Citi

Foreign funds continue to pour into Wall Street’s big banks. Merrill Lynch said it is issuing $6.6 billion in convertible, preferred stock to Korean Investment Corp., Kuwait Investment Authority, and Mizuho Corporate Bank of Japan, according to The Wall Street Journal.

Citigroup, which today reports huge losses, says its new funds include a $6.88 billion from the Government of Singapore Investment Corp., Capital Research Global Investors, Capital World Investors, the Kuwait Investment Authority, the New Jersey Division of Investment, Prince Alwaleed bin Talal of Saudi Arabia, and former Citi Chairman and CEO Sanford Weill, according to Journal.

"One of my main priorities over the last several weeks has been to ensure Merrill Lynch's balance sheet is strong, and these transactions make certain that Merrill Lynch is well-capitalized," John Thain, the former New York Stock Exchange chief who succeeded outgoing Merrill CEO Stan O”Neal last fall, told the Journal. The financial breakdown among the three new investors wasn't immediately clear.