NEW YORK (
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is reportedly getting ready to issue another $5 billion in government-backed bonds.
The New York company is planning to sell two-year and three-year fixed-rate notes, in addition to three-year floating rate notes through the FDIC's Temporary Liquidity Guarantee Program, according to
, which cited people familiar with the deal.
said the offering includes $1.25 billion in two-year notes expected to yield 5 basis points below midswaps. It also includes $250 million in two-year floating rate notes expected to have a coupon rate of 3 basis points below three-month LIBOR.
The deal will also include $2.5 billion in three-year notes expected to yield 3 basis points below midswaps and $1 billion in three-year floating-rate notes with an expected coupon rate of flat over three-month LIBOR, according to
just completed a separate $5 billion government-backed debt offering two weeks ago. At the time, rumors surfaced that the company was looking to exit the TLGP, like
Bank of America
have already done.
Citi received $45 billion in government bailout funds last year. The company recently completed a $25 billion preferred-to-common stock exchange with the government, which is now a 34% stakeholder. The other $20 billion of bailout funding is in trust preferred securities, which Citi would like to pay back, even though it has been vague on when or how it would do so.
One requirement to getting cleared to pay back the bailout funds is that Citi must show it can issue debt without the federal guarantees so this latest offering wouldn't seem to bode well for its efforts to break free from the government's grasp.
Citi has issued $15.4 billion in non-guaranteed debt this year, compared to the $54.6 billion in guaranteed debt it's issued since the FDIC program was initiated in the fourth quarter of last year, according to the company.
A Citi spokeswoman declined to comment on speculation of Tuesday's offering.
Shares closed Tuesday up 2.8% at $4.70.
-- Written by Laurie Kulikowski in New York