The Singapore government has cut its stake in
Citigroup to less than 5 per cent, realising a $1.6 billion profit as the city-state’s investment companies reduce holdings in European and US banks, according to Bloomberg.  

Government of Singapore Investment Corp sold the stock after converting preferred shares in the New York-based bank into a more than 9 per cent common-equity stake, it said, the news service reported. The company, manager of more than $100 billion of foreign-exchange reserves, also has a $1.6 billion paper profit on its remaining holding.

Citigroup shares have surged more than fourfold since falling below $1 on 5 March.

GIC exchanged $6.88 billion of convertible preferred stock for Citigroup common shares at $3.25 each on 11 September, together with the US government and other investors, the news service. GIC ended up with a stake of more than 9 percent in Citigroup following the exchange.

GIC said it was committed to its $18 billion of investments in Citigroup and UBS.