U.S. Markets closed

U.S. government selling last of its Citigroup bailout securities

A man walks past a Citibank branch in lower Manhattan, New York October 16, 2012. REUTERS/Carlo Allegri

(Reuters) - Nearly five years after bailing out Citigroup Inc (NYS:C) in the financial crisis, the U.S. government is selling the last of its interests in the company.

The Federal Deposit Insurance Corp is offering $2.42 billion of Citigroup bonds on Tuesday, according to a filing by the company with the U.S. Securities and Exchange Commission.

"When the transaction concludes, no U.S. government entity will continue to hold any securities in Citi issued as a result of the financial crisis," Citigroup said in a written statement.

The securities being offered on Tuesday originated with a promise the government made in January 2009 to support the company's capital by agreeing to share in any losses on $301 billion of Citigroup assets.

The loss agreement followed capital infusions from the government of $20 billion in December 2008 and $25 billion in October 2008. Citigroup received more assistance than any other U.S. bank in the crisis.

The FDIC's sale this week is about three times larger than a similar sale for the government in February of $894 million of debt.

Previously, the government sold other securities it had received in exchange for the bailouts.

"We remain very appreciative of the support provided by the U.S. Treasury, FDIC and American taxpayer during the financial crisis and are pleased that their investment realized a return of more than $13 billion," the company's statement said.

Citigroup shares traded at $51.14 in New York, up 2.1 percent for the day, but down 89 percent from their level five years ago.

(Reporting by David Henry in New York; Editing by Carol Bishopric)