Citi vows to use bailout money correctly

Citigroup c responded to the intensifying pressure to stop wasteful spending on Tuesday with a 43-page report that details its plans to use government bailout money to make loans to homeowners, students, businesses and consumers.

"Citi understands that (the bailout) is about helping the American people, and supporting U.S. businesses and our communities," Citi CEO Vikram Pandit said in the report.

Citi has received $45 billion from taxpayers in the last four months.

The report follows President Obama's public scolding of the company last week after it agreed to spend $50 million on a new private jet. Obama said that the government had a right to expect that Wall Street would "show some restraint and show some discipline and show some sense of responsibility" in the way it uses public funds.

Citi canceled the order after the government demanded that it do so. Now, the banking giant wants to show that it gets the message.

The bank said it would use bailout money for loans, including $10 billion of home loans supported by Fannie Mae and Freddie Mac, and $1 billion in student loans. Pandit said the funds won't be used for compensation and bonuses, dividend payments, lobbying or government relations activities, or any activities related to marketing, advertising and corporate sponsorship.

Citi also is under pressure from Washington lawmakers to get out of a contract to pay $400 million to the New York Mets for the right to name the team's new stadium Citi Field.

"One way to show they are taking care of Americans' money is by spending the money wisely — not by naming a stadium for yourself," says Rep. Ted Poe, R-Texas. "Most Americans can't afford tickets to go to the game, anyway."

Both the bank and the baseball team said that Citi is bound by a contract to pay. "Citi signed a legally binding agreement with the New York Mets in 2006," Citi said in a statement.

But some lawmakers are livid.

"Anybody can get out of a contract for a penalty — that's not rocket science," says Rep. Dennis Kucinich, D-Ohio, who sent a letter to Pandit asking for documents that prove Citi will not use bailout funds to pay for the contract with the Mets.

He and Poe also sent a letter to the Treasury Department asking it to press Citigroup to dissolve the contract.

Kucinich says that Citi should realize that it's "a whole new ballgame now, for fiscal accountability, transparency and frugality."