Citi to Sell $3 Billion in Stock
Battered financial titan
Citigroup
(C) - Get Report
on late Tuesday said it planned to offer $3 billion in common stock to boost its capital reserves depleted by the credit crisis.
The offering comes less than two weeks after Citi posted a $5.1 billion first-quarter loss and
in deteriorating fixed income securities. The bank last week sold $4 billion in preferred stock and in January raised $18.65 million through preferred offering and private placements to shore up its shaky balance sheet.
"We are issuing common equity at this time as we continue to optimize our capital structure," CFO Gary Crittenden said in a company statement. "We're pleased with the strong interest we have already received regarding this issuance."
Citi Markets & Banking will serve as the sole underwriter of the offering.
Citi shares were falling 2.9% to $25.57 in recent after-hours trading.
The move is sure to rile
Citi shareholders, whose stake in the bank will be diluted. But Citi is far from alone among cash-starved banks resorting to raising money in the public and private markets.
Earlier this month,
Washington Mutual
(WM) - Get Report
,
Wachovia
(WB) - Get Report
and
National City
(NCC)
all raised $7 billion in either stock offerings, private equity investments or both after posting quarterly losses.
Merrill Lynch
(MER)
and
Lehman Brothers
(LEH)
also recently sold preferred stock and
Bank of America
(BAC) - Get Report
last week sold $4 billion in hybrid securities.
This article was written by a staff member of TheStreet.com.









