Treasury Backs Off Plan to Sell Citi Stock
Prices were so low taxpayers would have lost $770M
By Kate Seamons,  Newser Staff
Posted Dec 17, 2009 8:01 AM CST
Pedestrians walk by the Citigroup building on July 17, 2009 in New York, New York.   (Getty Images)

(Newser) – The Treasury has done an about-face on its plan to unload part of its 34% stake in Citigroup. The reversal comes as investors responded tepidly to the offering of as much as $5 billion in stock, forcing Citigroup to sell at a discounted price of $3.15 a share—10 cents below what the Treasury paid for its 7.7 billion shares, reports the Wall Street Journal.

Rather than lose upwards of $770 million on its Citibank investment, the embarrassed Treasury said it now plans to sell off its stock gradually over the next year, a shift from the plan, announced Monday, to unload it in as soon as six months.