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Citigroup: Financial Winners & Losers

Citigroup rose following a report it is seeking more than $3 billion for its private-equity and hedge funds

(Citigroup and other share prices brought current in this update.)

NEW YORK (

TheStreet

) -

Citigroup

(C) - Get Report

was among the winners of the financial sector Friday after a report

the bank is seeking more than $3 billion for its private-equity and hedge funds

.

Citigroup

rose after

Bloomberg

, citing people familiar with the situation, reported that Citi Capital Advisors, a unit of the bank, may seek $1.5 billion for private equity and $750 million for hedge funds. Sources said Citigroup hopes to raise an additional $1 billion for its hedge funds next year, according to the report.

Citigroup shares were lately up 1% to $4.

Citigroup's reported plans to raise funds come even as U.S. regulators consider

a reform proposal that would ban banks from owning and investing in so-called alternative funds

.

Politico

reports that U.S. House Financial Services Committee Chairman Barney Frank said a version of the controversial plan, dubbed the Volcker rule after former

Federal Reserve

Chairman Paul Volcker and championed by Sen. Blanche Lincoln, would be in a final regulatory reform bill.

"She's clarified it, as she said, and I think we're very close now to an agreement," Frank said, according to

Politico

. "We think that while in principle she's right, there were some technical issues there that had to be straightened out, and I think they're on the way."

Most U.S. bank stocks were trading higher after the report.

JPMorgan Chase

(JPM) - Get Report

was up 1.4% to $38.99,

Morgan Stanley

(MS) - Get Report

tacked on 1.2% to $25.63,

Goldman Sachs

(GS) - Get Report

added 1% to $138.62, and

Wells Fargo

TheStreet Recommends

(WFC) - Get Report

gained 0.1% to $27.94.

Meanwhile,

Bank of America

(BAC) - Get Report

was flat at $15.82.

On the downside, shares of

Fannie Mae

and

Freddie Mac

continue to drop after the Federal Housing Finance Agency (FHFA) said Wednesday it has

directed both to delist

from the

New York Stock Exchange

.

The FHFA said the determination to direct delisting is related to stock exchange requirements for maintaining price levels and curing deficiencies, and "does not constitute any reflection on either enterprise's current performance or future direction, nor does delisting imply any other findings or determination on the part of FHFA as regulator or conservator."

Fannie and Freddie

expect that the delisting of their common and preferred stock from the NYSE will be effective 10 days after informing the

Securities and Exchange Commission

, which would come on July 8. After delisting from the NYSE, both stocks will move to the over-the-counter market, the companies said.

Fannie Mae shares plunged 17.6% to 35.3 cents, bringing the stock's three-day decline to 54.7%. Freddie Mac shares slid nearly 20% to 41 cents, bringing the stock's three-day drop to 58.5%.

Meanwhile,

Ambac Financial

(ABK)

said late Thursday it will issue approximately 5.03 million share of common stock in exchange for a total of $8.5 million in debt to bondholders. Following the transactions, there will be more 293.42 million shares of Ambac common stock outstanding.

Last week, the bond insurer said in a regulatory filing Wednesday that it

may seek a negotiated restructuring through a prepackaged bankruptcy

as liquidity may run out before the second quarter of 2011. That news dropped Ambac shares to a 52-week low of 51 cents.

Ambac shares were rising by 2 cents, or 2.4%, to 80 cents

-- Written by Robert Holmes in Boston

.

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