Citigroup Inc. is announcing the redemption, in whole, of its 6.450% Enhanced TRUPS® issued by Citigroup Capital XVI (CUSIP: 17310L201) (the “Redeemed TRUPS®”).
The redemption date for the Redeemed TRUPS® is July 15, 2013. The cash redemption price payable for each Redeemed TRUPS® on the redemption date will equal $25 plus $0.0671875 in accumulated and unpaid distributions.
This redemption reflects Citigroup’s ongoing efforts to enhance the efficiency of its funding and capital structure. Since the beginning of 2012 and including the redemption announced today, Citigroup has retired $23.6 billion of senior debt, subordinated debt, preferred and trust preferred securities, reducing Citigroup’s overall funding costs and efficiently deploying its ample liquidity.
The redemption announced today is consistent with Citi’s liability management strategy, and reflects Citi’s strategy of continuing to optimize the capital structure under Basel III. Citigroup will continue to consider opportunities to redeem or repurchase its senior debt, subordinated debt, preferred and trust preferred securities, based on several factors, including without limitation, the economic value, potential impact on Citigroup’s net interest margin and borrowing costs, the overall remaining tenor of Citigroup’s debt portfolio, as well as overall market conditions.
Citigroup’s Tier 1 Common capital and related Tier 1 Common ratio, either under Basel I or as estimated under Basel III, will not be affected by the planned redemption. Citigroup’s Basel I Tier 1 Capital and its Basel 1 Tier 1 Capital ratio are expected to decrease by approximately $0.95B and 9 basis points, respectively.
The Redeemed TRUPS® are being redeemed, along with the common securities issued by Citigroup Capital XVI (“Capital XVI”) and held by Citigroup, as a result of the concurrent redemption in whole by Citigroup of the junior subordinated debt securities held by Capital XVI which underlie the Redeemed TRUPS®.
Beginning on the redemption date, the Redeemed TRUPS® will no longer be considered outstanding and distributions will no longer accrue on such securities.
The Bank of New York Mellon is the paying agent for the Redeemed TRUPS®.