Treasury to Sell Citi Shares Acquired in Bailout

Monday, 29 Mar 2010 09:04 AM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
The U.S. Treasury said on Monday it would sell all of the 7.7 billion Citigroup common shares it owns over the course of 2010 under a prearranged written trading plan.

The Treasury, which acquired a 27 percent stake in Citigroup during bailouts of the banking giant in 2008 and 2009, said it would sell the shares into the market "through various means in an orderly and measured fashion."

"Treasury intends to initiate its disposition of the common shares pursuant to a prearranged written trading plan. The manner, amount and timing of the sales under the plan is dependent upon a number of factors," the Treasury said in a statement.

It did not elaborate on the factors it would consider in the sales, nor did it provide any further details of the trading plan, which is subject to market conditions.

A Citigroup spokesman declined to comment on Treasury's announcement The Treasury said it has engaged Morgan Stanley as its capital markets adviser for its Citigroup position.

Citigroup shares were bid at $4.37 in pre-market trade, making the government's stake potentially worth $33.73 billion at that price, which would produce a profit for taxpayers. Uncertainty over the disposition of the government stake has held down the bank's shares as other big financial services firms have rallied over the last year.

Citi received about $45 billion in capital from the Treasury's $700 billion Troubled Asset Relief Program in two tranches during the financial crisis. But in a third bailout in June 2009, the Treasury agreed to swap its preferred shares in Citigroup into about $25 billion worth of common stock to build up the bank's capital cushion.

At the end of last year, Citigroup repaid $20 billion of its bailout funds and ended a $5 billion asset guarantee program to escape special pay restrictions.

The Treasury said the sale plan would not affect the Citigroup trust preferred securities it still owns or its warrants to purchase Citigroup shares, which is a potential source for further profits on the Citi bailout.

U.S. Treasury Secretary Timothy Geithner and other top Treasury officials have repeatedly said they plan to exit their Citi stake "as soon as practicable."

© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Purdue Professor: Ebola 'Unlikely to Spread Here' in US

Friday, 19 Sep 2014 20:25 PM

The Ebola virus is unlikely to cause a deadly epidemic in the United States, according to David Sanders, an associate pr . . .

Polly Bergen, 'Cape Fear' Actress, Dies at 84

Saturday, 20 Sep 2014 20:04 PM

Actress and singer Polly Bergen, who's best known for her role in the original Cape Fear opposite Gregory Peck, died a . . .

Feds Mum on Prosecution of Illegal Border Crossers

Saturday, 20 Sep 2014 17:33 PM

The federal government refuses to say whether prosecutors in Yuma, Arizona, have scaled back a years-old program that gu . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved