NEW YORK ( TheStreet)-- Axa Private Equity is scoping out other U.S. banks for potential deals after its $1.7 billion acquisition of private equity assets from Citigroup ( C) announced Wednesday.

Some of the assets that Axa Private Equity is buying include stakes in KKR ( KKR), The Blackstone Group ( BX), Carlyle Group, and First Data Corp. , Axa confirmed. Benoit Verbrugghe, head of AXA Private Equity U.S. and Vincent Gombault, member of the board at AXA Private Equity, said that Axa plans to hold onto the stakes for at least three years.

Axa Private Equity has been gradually scooping up private equity assets from banks who are looking to unload them to comply with the Volcker Rule which is legislation that limits banks' proprietary trading. Axa op purchase $1.9 in assets from Bank of America ( BAC) in April 2010 and also acquired assets from Natixis in July 2010.

"Our strategy is to grow through acquiring assets of U.S banks, European banks and pension funds in the U.S. and in Europe," Gombault said. "We are only interested in private equity assets. Not mortgages. We are currently in talks with more institutions. "

The sale is part of Citigroup's overall strategy to trim down its assets in Citi Holdings. In 2010 Citigroup sold $100 billion in assets. As of March 31, 2011, Citi has reduced assets within Citi Holdings by$490 billion since 2008 and has completed more than 60 divestitures since the end of 2007, a Citigroup spokesperson confirmed. The assets in Citi Holdings are now $337 billion.

"This sale marks the completion of a significant share of Citi Holdings' proprietary private equity investments and demonstrates the progress the Citi Holdings team is making in reducing non-core assets on our balance sheet," said Mark Mason, COO of Citi Holdings in a press release.

Citigroup has been shopping its consumer finance unit, Citi Financial. The unit is rumored to have gotten interest from Leucadia National Corp. and Centerbridge Capital Partners as bidders. Last week Citigroup shut down a hedge fund and reportedly will be looking to shut down more as it restructures.

--Written by Maria Woehr in New York.

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