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Citigroup Inc, the world8217;s largest financial services company, on Friday said it will consolidate its capital markets funding business into two parts, and simplify the company8217;s legal structure.
New York-based Citigroup did not immediately return a call seeking comment on why it is making the changes.
In the funding consolidation, Citigroup Funding Inc, a new unit, will issue commercial paper and medium-term notes, while Citigroup Inc will continue to issue long-term debt, preferred securities and common stock.
This consolidation is set to begin in the second quarter.
Citigroup said it expects to unconditionally guarantee the outstanding public debt of its Citigroup Global Markets Holdings Inc unit. That entity will stop filing periodic reports with the US Securities and Exchange Commission.
Separately, Citigroup said its Citigroup Holdings Co and Citicorp intermediate bank holding companies will merge into the parent by the end of the third quarter, pending regulatory approval. Citigroup will assume Citicorp8217;s existing debt and guarantees.
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8226; Citigroup Funding Inc, a new unit, will issue commercial paper and medium-term notes, while Citigroup Inc will continue to issue long-term debt, preferred securities and common stock |
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Citigroup is one of the largest US debt issuers.
Last year, it issued 41.9 billion of debt, which was 10.2 billion more than Bank of America Corp, the next largest bank issuer in the United States of America, offered, according to research agency Lehman Brothers Inc.
Citigroup has about 65 billion of rated long-term debt, according to Moody8217;s Investors Service.
Citigroup shares closed Thursday at 48.98.
The company8217;s shares have risen 2 per cent this year.
