Banking Crisis

Citigroup Nears TARP Repayment Deal With US - Report

Tom Burroughes Editor London 14 December 2009

Citigroup Nears TARP Repayment Deal With US - Report

Citigroup is close to a deal with the US government and regulators that would let it repay its $20 billion of bailout funds, according to Bloomberg, citing unnamed sources.

The plan could be revealed as soon as today, the news agency said. The plan will see the bank raise about $20 billion of capital. A partial offering of the US Treasury’s 7.7 billion shares will be co-ordinated with Citigroup.

The bank wishes to exit the US government’s Troubled Asset Relief Program, or TARP, so that it can be freed from the controls that policymakers can exert on issues such as executive pay and corporate strategy.

Citigroup also plans an early termination of guarantees from the Treasury, Federal Deposit Insurance Corp. and the Federal Reserve on $301 billion of the bank’s riskiest securities, mortgages, auto loans, commercial real estate and other assets, the report said.

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