Citi Issues Notes - Analyst Blog

Citigroup Inc. (C) yesterday announced the sale of $1.875 billion worth of senior remarketing notes. The notes will mature on Jan 15, 2015. These will bear interest at a fixed rate of 6.01% per annum. Interest on the notes is payable semi-annually in equal installments on the 15th day of each June and December, commencing Jun 15, 2010. 

The proceeds from the offering will be used to purchase an interest bearing deposit with Citibank; the remaining portion of the proceeds will be remitted to the holders of Upper Debt exchangeable for common stock (DECS) equity units participating in the remarketing. The notes will be denominated as senior unsecured debt securities. 

The notes are being remarketed through Citigroup Global Markets Inc. These are being offered globally for sale in the United States, Europe and Asia. The notes carry a rating of “A3", “A" and “A+" from Moody’s (MCO), Standard & Poor’s and Fitch Ratings, respectively. The company’s stockholders equity was $140.8 billion and ratio of income to fixed charge stood at 1.16X. 

Earlier in September, the company sold 5-year senior notes worth $2.0 billion, the proceeds of which were used for general corporate purposes. During the third quarter of 2009, the company announced a pre-tax loss of $529 million due to credit losses in its US credit card and mortgage businesses, as well as in divisions of its corporate business. 

The bank appears to be no closer to freeing itself from the grip of the US government, which also owns $20 billion of preferred shares and has provided a $306 billion loan-loss guarantee.
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