Citigroup Announces $3 Billion Redemption of Trust Preferred Securities

New York - 15 March 2013

Citigroup Inc. is announcing the redemption, in whole, of the following four series of its trust preferred securities:

  • the 7.125% TRUPS® issued by Citigroup Capital VII (CUSIP: 17306N203);
  • the 6.950% TRUPS® issued by Citigroup Capital VIII (CUSIP: 17306R204);
  • the 6.875% Enhanced TRUPS® issued by Citigroup Capital XIV (CUSIP: 17309E200); and
  • the 6.500% Enhanced TRUPS® issued by Citigroup Capital XV (CUSIP: 17310G202) (collectively, the “Redeemed TRUPS®”).

The redemption date for each series of Redeemed TRUPS® is April 16, 2013. The cash redemption price payable for each Redeemed TRUPS® on the redemption date will equal:

  • for Citigroup Capital VII, $25 plus $0.3018229167 in accumulated and unpaid distributions;
  • for Citigroup Capital VIII, $25 plus $0.1496180556 in accumulated and unpaid distributions;
  • for Citigroup Capital XIV, $25 plus $0.0763888889 in accumulated and unpaid distributions; and
  • for Citigroup Capital XV, $25 plus $0.1399305556 in accumulated and unpaid distributions.

These redemptions reflect Citigroup’s ongoing efforts to enhance the efficiency of its funding and capital structure. Since the beginning of 2012 and including the redemptions announced today, Citigroup has retired $9.4 billion of trust preferred securities, reducing Citigroup’s overall funding costs and efficiently deploying its ample liquidity.

The redemptions announced today were approved as part of Citi’s planned capital actions pursuant to the 2013 Comprehensive Capital Analysis and Review (CCAR), are consistent with Citi’s liability management strategy, and reflect Citi’s strategy of continuing to optimize the capital structure under Basel III. Citigroup will continue to consider opportunities to redeem or repurchase 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 redemptions. Citigroup’s Basel I Tier 1 Capital and its Basel 1 Tier 1 Capital ratio are expected to decrease by approximately $3B and 30 basis points, respectively.

The Redeemed TRUPS® are being redeemed, along with the common securities issued by Citigroup Capital VII, Citigroup Capital VIII, Citigroup Capital XIV and Citigroup Capital XV (collectively, the “Capital Trusts”) and held by Citigroup, as a result of the concurrent redemption in whole by Citigroup of the junior subordinated debt securities held by each Capital Trust which underlie the respective series of 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®.

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