Treasury to sell 1.5B Citigroup shares

WASHINGTON, Oct. 19 (UPI) -- The U.S. Treasury Department said Tuesday it was preparing to sell 1.5 billion shares of Citigroup common stock out of its holdings of 3.5 billion shares.

In a corporate report released Monday, Citigroup said it earned $2.17 billion in net income in the third quarter, up from $101 million in the same quarter of 2009. Its revenue, however, dropped to $20.7 billion from $23.1 billion a year ago.

At the height of the financial crisis, the Treasury poured $45 billion in taxpayer funding into shoring up Citigroup's capital reserves. To date, the Treasury said, taxpayers have recouped $41.6 billion back from Citigroup in dividends, interest, repayment and sales of common stock.

The Treasury held 7.7 billion shares of the bank last summer and sold 4.1 billion of those in September, recouping $16.4 billion.

When the sale announced Tuesday is complete, the government's share of the bank would drop to about 7 percent of total shares outstanding, down from a peak 27 percent.

Treasury said Morgan Stanley would act as the sales agent for the divestment.