The US Treasury has announced plans to sell a stake in Citigroup it bought to bailout the bank at the height of the financial crisis in 2008 and 2009.
The government is unloading up to 1.5-billion Citigroup common shares as part of its strategy to step down as a major stockholder.
President Obama has already said he intends to recoup ‘every single dime’ of taxpayers’ money used to rescue the banks. Treasury Secretary Timothy Geithner said this way of doing it was much cheaper than previous ways of escaping banking crises.
The Treasury owns 27 per cent of Citigroup. Of the 34-billion euros it put in, Citigroup has already repaid 15-billion, and converted a further 19-billion in preferred shares to common stock.
Despite the announcement of an orderly sell-off, Citigroup’s shares slid nearly 2 per cent.