The US banking giant hopes that a takeover will limit damage to the company's reputation after six of Nikko's high-ranking executives resigned after the company conceded they had massaged their 2004 profit figures and an investigation found evidence of fraud.
A Citigroup takeover would also enable it to keep the corporate business base that they were able to build via its partnership with Nikko and arrest the company's decline that has seen it shares dip 19 per cent since December 15 of last year.
Citigroup, who own a 49 per cent share in the joint venture, has thus far declined to comment on the renewed rumours, but in an interview with Reuters last month chief executive, Charles Prince, said:
"There has been some negative impact on the joint venture because of the publicity and so forth around Nikko Cordial, and in terms of our ownership, I think that's something that we're going to have to continue to study,"
News of Citigroup's plans comes after reports this week that the bank was considering listing on the Tokyo Stock Exchange to facilitate expansion in the region.